If growing your company is at the top of your agenda, there's no better way
to invest in the future than by putting together a board of directors. Think
your company might be too small for one? Think again. Recruiting an effective
board can provide even the smallest companies with contacts, credibility, wisdom
and access to resources critical to growth.
So how do you assemble an advisory "dream team" to help you move from where
you are now to where you want to be? Here's a profile of the personality types
you need to form a top-notch board:
The money magnet: If your business needs cash to grow, this board
member knows where to find it or what you need to do to attract it. She'll have
a proven track record navigating the world of other people's money and may even
have her own money to invest in your endeavor. Having this capital-raising
expert on board is a plus, especially if you think VC funding is in your future.
The canary: This qualified and strategic accountant-type possesses
sophisticated financial expertise and is versed in analyzing and navigating your
balance sheet. She can act as your "canary in the coal mine," helping you avoid
unnecessary risks, streamline costs and protect profits.
The influencer: Well-respected and connected, the influencer is more
than willing to provide personal introductions to other influential people who
can help take your business to the next level. Influencers can deliver pivotal
alliances and new business opportunities to your doorstep.
The insider: This board member knows the ropes of your marketplace
inside and out. She has likely been there and done that, and she brings
boatloads of operating experience to the table, enabling you to identify how to
make your company work smarter. This member may act as a personal mentor to you
as well.
The outsider: Perhaps a CEO outside your sector, this board member's
strength is leadership. Her perspective and advice are valuable precisely
because she isn't that familiar with your industry. This member's involvement
will demonstrate your openness and willingness to include others in setting a
vision for your company.
Your dream team board also has to work well with and for you. These are the
essentials for building a productive board:
- Active boards are better than cosmetic ones loaded with friends and
relatives. Typically, the latter won't do much to challenge your perspective
or generate results.
- Make sure your board is small enough for you to manage and that the size
is an odd number so deadlock is never an issue.
- Locally based boards are always best, since it's easier to schedule
meetings with relative frequency. My suggestion is one meeting every other
month.
- Boards work best when goals and timelines are clear. Let them know what
you need most and what will have the greatest impact on your company's
future.
- Morning meetings are always best and a "check your cell phone or
Blackberry at the door" policy is advised. These are busy, in-demand people;
you need to keep them focused on your conversation.
- Always forward two to three results you hope to obtain at least two days
in advance of each meeting. When members know what's expected from their
participation, you'll get better input.
- Establish with members the amount of contact time you need with them
between meetings. An upfront agreement will not only be helpful to them, but
it'll also remove the intimidation factor when you need access.
- Compensate board members. This is standard practice and can be done for
a small percentage interest in your company. Compensation turns your board
from a volunteer activity to a professional commitment based on an exchange
of value. This is critical if your board is to be held accountable to
produce results.
How much does a strong board of directors really matter to a small,
growth-oriented company? A well-connected board of experts gives your company
credibility, knowledge and access to opportunity. Tapping into this deep well
will go a long way toward growing your success.