An advisory board might be just the ticket to help you grow. If your business is incorporated, you’ve likely already got a board of directors: yourself. But the fact that your name is listed as both CEO and director doesn’t mean you should go it alone when it comes to setting strategy.
That’s where an advisory board can be useful. Typically composed of five or seven members, such a board offers the guidance and insight of a seasoned group of executives outside your own company. If you’ve chosen members well, they’ll provide perspective, advice and, occasionally, a cold, hard dose of reality. “An advisory board is a comfort and a curse,” says John Reddish of Advent Management in Drexel Hill, Pennsylvania. “If they’re doing their job, they’re going to be giving you good counsel. And they’re going to be looking over your shoulder, making sure you implement that advice well.”
Say you’re thinking about opening a few units out of state. As you consider whom to invite to join your board, you might want to seek out a real estate pro with experience in site selection. You could find a service-industry entrepreneur who manages a similar number of units in equally far-flung locations. And you could track down an IT expert with experience in retail.
Not all board members need restaurant experience. In fact, it’s preferable that some don’t. “The future for your business may have already happened in some other industry,” says Susan Schiffer Stautberg, president of PartnerCom Corp., a New York firm that assembles advisory boards. “It’s the job of your board to bring their knowledge back to your industry.”
How do you get successful people to commit? Make it easy for them. Hold meetings once per quarter, and send materials in advance. Ask board members to commit to just a one-year term. That gives them—and you—the chance to opt out.
Compensate people for their time. Reddish says fees range from $250 and a meal per meeting to $25,000 a year.
Don’t forget that board members will get something out of their service besides just another line on the resume. “They’re going to increase their intellectual and social capital,” says Stautberg. “In a really good board, different ideas bounce off of each other; you get catalysts for creative thinking, and you come away having learned something.” Best of all, you get the benefit of their wisdom without making the mistakes they did to earn it.