An Advisory Board – getting extra expertise into your Business, at minimal cost.
Most businesses have strong skills in their area of technical expertise – in this case production.
However, they sometimes lack skill, experience and ‘outside the square thinking’ in the wider area of business development, governance, accountability and business management.
When trying to attract additional finance to expand the business and go through an orderly business development process – this lack of business acumen and business management skill is often exposed as an area of significant need. This is particularly the case when seeking an external investor – or even significant funds from your bank!
Both banks and investors are increasingly discerning – though both have varied risk appetites and often different perspectives on how to grow and expand the business.
So, what action can we take?
A good place to start is to create an Advisory Board.
By using an Advisory Board, a rotating group of ‘Specialist Advisers’ – with a range of expertise (business management, financials, technical areas, strategy, marketing, etc) – can be accessed over time, often at reasonable cost. Also, they can come and go as required – according to needs at the time.
An Advisory Board usually involves routine, structured meetings of the management team and these Specialist Advisers.
At the Advisory Board meetings, specific agenda items will generally be included for each of the major functions or divisions of the business. This will ensure that all areas are regularly reviewed in a structured and organised manner – and are given regular and adequate focus.
Here are the top 3 considerations around creating an Advisory Board:
1. A Clear Brief.
In other words, what do you want to achieve? What direction do you want to take? What areas of skill are required to support you in the change and business development process?
The old saying ‘Clarity Leads to Power’ is the most critical one to implement first. It’s important to have a sense of general direction – even if the specifics are unclear. After all, that’s potentially what the Advisory Board is all about – working through with you to gain greater clarity over time.
This means it’s critical to take time to commit your ideas to paper – to create the necessary briefing documents – to give everyone involved a sense of common purpose. This is the first level of clarity.
2. A skilled Chairperson – and a CEO – both prepared to support each other in the change process.
Strong alignment between both parties will be critical – although robust discussion and potential disagreement – are part and parcel of this change process.
Specialist Advisory Board Members – even a small number – with varied skills aligned to your general direction of change must also be briefed. It’s important to recognise the capacity to rotate board members as required. Ensuring strong financial acumen amongst the least one board member is a key golden rule.
3. Discipline and time.
The change process will always take time – likely more than expected. As the change process can be frustrating, time-consuming and require considerable thinking and open discussion, all parties must ‘sign-up’ for this process. Discipline will be needed around strategy, reporting, financials, research, document development, customer review, etc. Having the right people in place at board and management level to support the discipline and time required is crucial.
What about the money?
While there will definitely be cost involved, sometimes philanthropically minded business people, who have a desire to give back to others in the industry, are prepared to contribute to the change process for varied fees – particularly if they see real benefit accruing from their involvement.
On the other hand, there may be critical advisers who will need to be paid the going rate – potentially for the considerable time, expertise and effort required.
Likewise, the management team of the business must also understand the time required by them to contribute to the thinking, work and action to support this change process.
As you’re thinking about the change process, here are some thought starters:
- “The Enemy of a Great Life – Is a Good Life”
- “Building a Better Business – starting with the End-in-Mind”
- “Your Independence May Be Hindering You More Than You Think”
Want to know more?
If you would like to know more about Advisory Boards the Agri-Business CEO Mentoring Program focuses on exploring these and other “outside-the-square” and progressive business management concepts.
The Program is designed to help you understand how to make a difference to the important things in your agribusiness – the things that are really holding your business back and the how to capitalise on the opportunities out there waiting for you.
Connect with industry specialists, in a group of like-minded, progressive business owners, and start making changes in your business. Create an investor ready / saleable, and self-managing agribusiness – that meets your and your family’s needs.