Why Would I Want an Advisory Board?
Here’s a secret. International research shows that, if a business owner has an advisory group supporting them, they can look forward to:
- Three times the rate of business growth
- Twice the rate of productivity growth
Compared to other businesses.
Truly, it’s that powerful. Contact us for a link to that research. And you know what? Only very few business owners have yet realised the power of this simple tool. You can be a leader in your industry, just by making good use of an advisory board.
What’s an Advisory Board?
A good board of directors should spend 80% of its time as a think-tank, 20% cross-checking. Eighty percent strategy, aspiration, creative thinking, horizon-scanning; 20% overseeing risk and compliance.
Based on the 80-20 Pareto Principle, the idea of an advisory board is to take that 80% think-tank function to a group of wise heads who are (mostly) not involved in running the business. In a small company, the 20% compliance and risk work can be done by the company’s shareholder-manager(s). Sounds good; how does it work out?
We’ve known companies attract very high-calibre, experienced business brains onto an advisory board, getting the value of their knowledge and contacts — and these are people who would not normally accept the time commitment and personal liability risk of joining the actual governance board of a small company.
An advisory board is not responsible for governing the company; its job is to guide and advise.
So how do you, a small business owner-manager, make use of an advisory board? You simply start by contacting the people you would most want as business advisors, and asking them.
The arrangement may be quite informal: you buy them all lunch from time to time in return for focussed input on issues you bring to the table. Or you can have a paid advisory board, who are likely to want to know more detail, including your financials.
The fee may be quite modest: people are often happy to extend a helping hand to a sound, ambitious business that’s being well run. It’s a good feeling to be associated with success.
The Advisory Board Dilemma
But you have a dilemma.
On the one hand, you have engaged and perhaps paid high-octane business talent for your company, and you want them to help you not only with ideas, but with making sure ideas are implemented. You want them to hold you accountable on strategy, targets, the business plan, markets, and “must do’s”. That’s where a lot of the value of advisory boards comes from, and anyhow they are likely to lose interest very quickly if you just invite them to a periodic talk-fest from which nothing much results.
On the other hand, they may inadvertently become de-facto directors. What’s that? Section 9 of the Corporations Act, our main statute, defines a director as (paraphrasing):
- A person who is appointed to the position of director, regardless of what that position is called;
- A person who acts as a director, or in accord with whose instructions or wishes the directors are accustomed to act.
In other words, your advisory board might be viewed by a court as your actual board, and your advisors might find themselves with the responsibilities and liabilities of actual directors of your company. And of course, this is only likely to come to light if something bad happens.
How do you resolve this dilemma? Draw up a charter for your advisory board (you should anyway), and make it clear that the actual directors are under no obligation to follow the advisors’ advice. Have it checked by a lawyer. Then minute everything.
Knowledgeable, professional and relevant. Thanks Iain
Loved the slogan/point of difference: Head Heart and Bottom Line. Passionate and a good listener.
Thanks Iain. This session has created the collaboration and discussion we needed…
Iain’s assistance was invaluable in improving our corporate governance policies and procedures. He took the time to understand the business, was responsive to our needs and a pleasure to work with. I would have no hesitation in recommending Iain and Upland Consulting.
Loved the slogan/point of difference: Head Heart and Bottom Line. Passionate and a good listener
I have worked with Iain for the last 6 months through his Peer Magic programme. His business knowledge is first class and I look forward to working with him into the future. Highly recommended.
Iain brought a new dimension to our company. Lifting our board performance away from the coal face with his knowledge of corporate governance, management skills, and systems development whilst maintaining a strategic 40 paces view. Iain has a very valuable skill set that can assist you out of the box.
Thank you so much for the facilitation, [it] was exactly what I expected from you, a safe and open forum to discuss and work through the process. We have a great starting point to get moving forward.
Iain at Upland Consulting specialises in Business growth. Through working with him I have developed more clarity regarding why I do my work at Horse Vision, where to go next with it and what the needs of my clients are.
Iain is a highly talented individual able to lead a team by being part of the team. Leaders need to surround themselves with honest straight-talking advisors that are able to help lift an organisation's performance with insight, balance and with humanity - Iain is perfectly suited to deliver such support. He is one of only a few individuals that I would recommend without hesitation.
Easy terminology and thought-provoking delivery
If you are starting up a new business involving a board of directors, a directors' workshop run by Iain is vital and will be money well spent.
Professional and valuable content that is very relevant to my role as a board member.
Very practical examples. Enough flexibility to allow us discussion. Excellent and relevant to our board.
Iain's facilitation invites participants to reflect on their own business, identify what is required, and find the motivation to more forward.
Great to think and listen to new ideas.
Good perspective and relevant to all. Iain has great career experiences to draw from and can adapt to many different audiences.
Clear and concise explanation and clarification.
Upland Consulting provided a friendly and efficient service. Added to this, the end product was on time, on budget and included the rare combination of being practical and innovative.
Wisdom @ work.
Iain is a really knowledgeable person and delivers a great strategy session.
I found [it] very easy to understand, topics allowed me to put in perspective [my work] on this board.
Iain's presentation was very thorough and informative. I took away lots of useful information.
Great talk, Q&A in particular.
Iain's practical approach to delivering his material makes the workshop very enjoyable. He's walked the road of business management before, so his advice comes from the heart, and is totally backed up by logic.
I love that Iain focussed on the importance of believing in what you're doing.
Thanks Iain. This session has created the collaboration and discussion we needed...
Iain conducts a very informative and engaging session. Inspirational and thought-provoking: many thanks.
Iain is very knowledgeable on his subject and a good, honest bloke.
Well authored and simply explained concepts.
Iain is an absolute pleasure to work with, as he is not only professional, responsible and efficient, but also very friendly and personable.
This presentation has been very informative and was a really good snapshot.
the method of presentation and... discussion was excellent. The content was very relevant and a bit of an eye-opener.
Iain is very knowledgeable in business strategy and has many tools that can help you spend time working ON your business rather than IN it.
The presentation was very well delivered and relevant...
I can see where a number of my clients could benefit from this [Peer Magic] programme in collaboration with my industry.
A great interactive session to look at and work on my business.
On-topic discussion that involved and engaged participants. Moved through in a timely manner... Enjoyed that it was delivered in a personal format and not by PowerPoint!
Very good, Iain, you delivered some amazing information and everyone had the opportunity to speak and share. Was terrific! Great guidance.
Nice presentation, easy-going and meaningful.
Prompted lots of thinking and new ideas.
Very informative. If you are in a family business, it is very worthwhile attending one of these sessions.
Iain is a fantastic presenter, and can help you explore and grow your business.
Strengthened my governance knowledge.
Iain Massey consults in business succession and exit planning. He is thoroughly professional and very knowledgeable on this complex topic. In my experience Iain delivers great value, great service and great results.
Thank you. Lots to think about, lots to re-motivate.
I found it extremely helpful and look forward to learning more. Very well explained, thank you.
Raised many issues that need addressing and combining into a risk management plan
Iain poses questions that get his audience talking about issues that are really important...
Good to sit down with both board and senior staff to explore and air concerns... Facilitation was excellent.
Two excellent presenters [the other was Mike Ansell], who worked well and encouraged audience participation
Very interesting seminar. Thank you.
Taking time out to reflect, learn and understand our business... was really worth it. Always take time out to work on the business, not just in it. Highly recommended.
Very informative and something I have been planning on doing. No excuses now!
Relaxed style of delivery, easy to understand.
Time well spent.
Iain's professional and guiding manner enabled a valuable interactive workshop.
Interesting and insightful presentation.