Last week I met with Kathleen Lucas‘s advisory board to help guide her and her business forward. Kathleen is a financial planning professional with New England Financial Group (a division of MetLife). This was the third of four bi-annual meetings. The experience sparked the idea for this week’s networking tip. I did a brief survey of Kathleen as well as the other advisory board members to find out what value they have received during this process.
I thought it might be helpful if I shed some light on the following questions:
- What is an advisory board and how does it differ from a corporate board?
- What are the benefits of serving on someone’s advisory board?
- How might you and your business benefit from forming your own advisory board?
What is an advisory board and how does it differ from a board of directors?
An advisory board is a small group (5-8 people) of hand picked individuals who are willing to guide you in your business and professional development. It is an unpaid, volunteer engagement where the parties agree to meet individually or as a group (more fun as a group!) over a period of time (one year to several years).
Individuals serving on the advisory board share ideas, offer feedback, challenge thinking and plans, and make critical connections to help the advised person be more successful.
The time commitment is limited. Preparation for and actions arising from the advisory board meetings are held to a minimum. The value you bring to the table is done on the day of the meeting.
Unlike corporate boards, advisory boards have no fiduciary responsibility and their advice is non-binding. They also do not benefit financially from any gains or losses made by the advised person.
Advisory board members often become referring partners, sponsors and fans of the advised person as knowledge of his/her business and the relationship and friendship grows over time. Advisory board members become emotionally vested in the growth and success of the advised person.
What are the benefits of serving on someone’s advisory board?
When Kathleen first asked me to sit on her advisory board, I thought to myself: “Why should I give away my coaching and consulting advice for free? Shouldn’t I be paid for this kind of work?” Once I got past that and said yes (mostly out of curiosity as to how this thing works), I started to see what a wonderful experience it was. I was actually benefiting, not just Kathleen Lucas!
Below are some of the benefits that her other advisers shared with me at the end of meeting. You can see that this experience was valuable to all parties involved!
- Networking. You get to meet other quality people and connect with them in a high trust, open, sharing environment. “This advisory board is a networking group of its own.” “It’s an opportunity to surround myself with smart, diverse and interesting people.”
- Critical thinking about business development. “You get to reflect on your own business, asking yourself critical questions and reflecting on ways to do things better.”
- Idea generation. Through a collaborative process, you get to take good ideas and make them better, more focused and more useful. “No one person has all the good ideas.”
- Big picture thinking. “You get the rare opportunity to view business and relationships from 1,000 foot view.”
- Reflection. “By stepping back and looking analytically at Kathleen’s business, I can see situations and opportuniti”es and actions that I could be taking in my own business.”
- Increased knowledge. “Quick learning about other industries and what is going on and current issues.”
- Prestige. You are recognized as a leader in your field, an accomplished professional who has knowledge and wisdom to share. “It was an honor to be asked.”
- Feel good factor. “It feels good to help someone else to grow.” “You get to see almost immediate benefits of the group’s input.”
How might you and your business benefit from forming an advisory board?
If you are a business owner and think you think you might benefit from tapping into to the expertise and wisdom of other accomplished professionals, you might consider forming an advisory board of your own.
I asked Kathleen Lucas why she formed this advisory board in the first place. Below is a list of her original motivations:
- Sounding board. “I wanted to draw out best practices and knowledge from others that I trusted.”
- Encouragement. “Support through sharing and understanding.”
- Vision. “Gain a wider how-to perspective from the personal and business experiences of others that I admire.”
- Relationships , fans and referrals. “Build deep relationships so that each advisor is willing to do business with and/or refer me to others in their networks.”
- Accountability. “I wanted to be held accountable to the success goals that I set.”
Forming an advisory board is not something you decide to do on the fly. It takes careful planning, coordination and investment of your time and money. You are the one who must be organized, prepared and accountable. You must make the experience a great one for each and every adviser. You must be fully accountable, honest and totally transparent in front of this group of respected peers of your choosing.
I found this article on-line to be insightful. Ten Tips to Creating an Effective Advisory Board, written by Geri Stengel, president of Stengel Solutions, a business strategist. Read it before you decide to move forward with forming your own advisory board.
Your Networking Goal for the Week
I’m a big believer in trying before you buy. So if the idea of an advisory panel interests you, why not start by joining someone’s advisory panel. Find out how the process works by being a participant rather than a leader. Share with people in your network that you are open to serving on someone’s advisory board.
Have a conversation with people that you network with this week about the topic of advisory board participation. Ask them if they have ever served in this capacity or if they have their own advisory board. Get the skinny on the pros/cons of the experience from their point of view.
Finally, just for exercise sake, why not make a list of 5-8 people that you admire and respect and who you would want on your advisory board, if you had one. Whose brain would you want to pick? Whose wealth of knowledge and experience would you and your business benefit from? Who would you want to be held accountable to?
Something to think about, isn’t it?