Why Build An Advisory Board?
Contributed by Marissa Levin.
I’ve never met a business owner that didn’t want to grow. In my 18-year career as a business owner, and in my conversations with hundreds of CEOs from around the globe, no one has ever said to me, “I’m perfectly happy with everything in my business. I know everything there is to know, I’m the best leader I can be, and no one can help me with anything.”
Every business owner or CEO you meet runs into roadblocks, challenges, setbacks, poor decisions, and finds themselves in over their head – even the CEOs that seemingly have it all together.
This reminds me of the following story:
“A little boy was having difficulty lifting a heavy stone.
His father came along just then.
Noting the boy’s failure, he asked, “Are you using all your strength?”
“Yes, I am,” the little boy said impatiently.
“No, you are not,” the father answered. “I am right here just waiting, and you haven’t asked me to help you.”
Who is helping you lift your heavy stones? Are you using all of your strength?
The good news is that when we find ourselves in temporary trouble, or when we’ve hit a plateau we can’t seem to break, there is help all around us. However, the number of CEOs that are comfortable asking for help is disproportionately low compared to the number of CEOs that need help.
Instead, many put on a brave face and choose to go it alone rather than risk looking weak or unsure. This reluctance to seek outside guidance can bring about unnecessary problems, and cost the company a lot of money. Whether it’s ego, pride, denial, mistrust, or fear that drives the decision to figure things out alone, it’s not in the best interest of the company.
When I implemented my first team of advisors three years, ago, I did so at the suggestion of one of my long-time mentors. He and I were having breakfast, and I was sharing with him that we seemed to have hit a wall. We couldn’t get past $5 million, there were no accountability measures, and the organization lacked the structure that a company of our size and complexity needed. I knew that hiring a bunch of expensive, full-time executives wasn’t a financial option – nor did I want to do that. I also wanted a long-term solution, rather than a short-term band-aid, like a consultant.
His suggestion triggered my search – my quest for the right people to surround me so I could grow to the next level.
The primary drivers for my advisors were:
- Expense management. We weren’t doing a good job of controlling our expenses
- Accountability. We had no process or accountability measures in place for the 70-plus projects we were managing. I wanted to implement a Project Management Office to standardize all project management processes. (This was the result of organic growth, and very common as a business moves from the start-up phase to the established phase. Processes that were once “optional” at start-up become essential to grow.)
- Customer Focus. We needed to really zero in on key accounts.
- Insourcing/Outsourcing. We needed assistance determining which operational functions we should outsource and which ones we should keep in house.
- 8a Graduation. We needed mentorship preparing for our exit from the 8a program.
These were just some of the common challenges that drove us to implement our first advisory board. In my book, I list (thanks to one of my advisors) 35 ways a company can leverage their board, from assisting with lease negotiations and double-checking email/proposal language to ensure we don’t create an Organizational Conflict of Interest (OCI) with a client, to raising capital or securing introductions to key decision makers and influencers.
The right advisors can be an indispensable asset for any company that wants to grow, and for any leader that wants to be the best leader they can be.
Asking for Help is a Sign of Executive Strength
Once we adopt the mindset that asking for help is a sign of strength, and once we become willing to let our community know we are open to growth, progress, and change, the sky is the limit for our potential.
Like everything in business, however, we need a plan of action to successfully execute an idea. For many, the idea of simply reaching out for help is sometimes overwhelming.
- How do I know what I need?
- Where do I go to find help?
- How do I ask for help?
- Do I have to pay these people?
- What will people think of me if I admit my challenges?
- What if no one will help?
These are typical questions that every business owner or CEO thinks about. As the head of a company, we know that everything we do counts. We know that our employees watch our every move. Our clients analyze us. Our competitors scrutinize us. How will it look if they see us struggling or scrambling?
Experience has taught me that asking for help is one of the greatest signs of strength a CEO can demonstrate. If we want our employees to reach out and ask for help from us, we must model this behavior. The ultimate goal is to build the best company possible. It is not to look as if we have all the answers.
I’m often asked what I believe is the greatest impediment to business growth. Is it the economy? No. Is it our customers, employees, market shifts, access to capital? No. Our greatest impediment to personal growth and business growth is ourselves. It is our inability to be comfortable with our weaknesses and seek help.
Building an Advisory Board takes careful planning and execution. If done correctly, it can literally transform a company. (More often than not, however, it’s not done correctly. CEOs see it as a waste of time, money and resources, and ROI is virtually nonexistent. This is attributed to a flawed execution rather than a flawed concept. We’ll address the how in subsequent columns.).
Strategically identifying needs through an in-depth Board-specific SWOT analysis, engaging the rest of the leadership team for perspectives and analysis (an Advisory Board is an extension of the company and not there to just serve the CEO), and clearly identifying very specific swim lanes for each advisor are essential first steps of a multi-phased strategy. It’s not as easy as, “Oh I met this great guy at an event, he’s built a great company. I’m going to put him on my Board.” The advisor screening process is just as important as the employee screening process.
I wrote my book because I want to help other business owners reduce the amount of difficulties they face as they grow their businesses, and give them tools and strategies to overcome them. When I was building my advisory team, there were no books that guided small business owners through the advisory board acquisition and set-up process. In true entrepreneurial fashion, I set out to fill that void.
This is how the SCALE Model came to be. I realized I had educated myself on how to best select and implement my board. I learned that associating new ideas and new experts into a company is very challenging. For areas of compensation and leverage, I reached to experts for guidance – I had no idea how to do this. At the end of my board creation journey, I realized I had a model, which I named SCALE: Select, Compensate, Associate, Leverage, and Evaluate/Evolve/Exit.
The purpose of this column is to inspire other CEOs to seek out the people they need to help them lift their heavy stones. If we want to be the very best at what we do, then we need to surround ourselves with others that are the very best at what they do.
Remove the pre-conceived ideas that reaching out to others is weak, and that exposing your challenges is a liability. Believe that the right people around you can be a catalyst to your growth. Make your voice heard about what you need.
If you’ve read this far, congrats to you for considering the idea of an Advisory Board, or for wanting to know how to improve what you’ve already implemented. You’re on your way to growth!
“Leadership and learning are indispensable to each other.” ~John F. Kennedy
Marissa Levin provides transformational CEO & executive coaching and facilitation under the TransformU Growth Program. She focuses on strategy, people, process, infrastructure, and goal-setting.
Finding an advisor has never been easier or more reliable. Visit Cerius Advisors to learn how. Avoid painful lessons learned. Talk to someone who has already been down the road before you.