Does your Company Need Both an Advisory Board and a Board of Directors?
Merissa Levin is a renowned author, speaker, and expert on advisory boards and board of directors. She gives her perspective on the matter:
“I think it depends on the industry that you’re in and even the geographical location. Like we’re on the east coast, and I know the east coast is a lot more risk aversive when it comes to investment as opposed to the west coast. On the east coast, a lot of the advisory boards do not have investors on them because the structure and the advisory board members end up constituting a lot of presence from the government. So a lot of the advisory board members on the east coast, people who do business with the government. That is a huge presence on advisory boards. Whereas I know on the west coast where investors play a very large role in advisory boards. I think it really depends on where you are geographically in the industry that you serve. They can really drive the makeup of your advisory board. That’s been my experience.”
Merissa has actually written a book on the building a board:
“I have a book out. It’s called ‘Built to Scale’; how top companies create breakthrough growth through exceptional advisory boards. And SCALE is a model I created that when I wanted to put in a board in my first company which is Information Experts, that’s a 20 year old multi-million dollar government contracting firm. I wanted to put a board in place about 7 years ago, and when I went to look for information on how to build a board there were lots of articles that said how you should build a board. There was literally nothing out there on how to do it. So I created a model called SCALE and that is Select, Compensate, Associate, Leverage and Evaluate, Evolve and Exit. That is literally the full end and soup to that process on how you make sure that you are selecting advisors that really meet the needs of your company. Because typically what people do is they meet somebody that they think is great, and they say do you want to join my board, but they haven’t really thought about how they sit them in to the board or what role they would play. And that’s kind of putting the cart before the horse. So in my model, the SCALE model, the entire Select phase is very strategic in making sure that you identify who you need according to your holes and your goals inside your organization and you put a very methodical approach to selecting and vetting and then bringing them on.”
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