Who do you report to?
So let’s get straight to the point - the economy sucks for most of us, economic stimulus is passé already, and with all the doom and gloom being spouted throughout the media, it must be my patriotic duty to do my part to ‘stimulate’ as well.
THE ABSOLUTE BEST COMPETITIVE ADVANTAGE
Any competitor with the right motivation and funding can sell the same products and offer the same services as you. They can buy a building right next to yours. And they can copy you in virtually every way except two; they cannot duplicate your staff and they cannot duplicate the input you get from your advisors.
A word about staff - people want to work for good companies. As long as you are constantly striving to improve your organization and treat your employees with the respect they deserve, they will be loyal. (If this sounds like a good topic for a future article, please let me know.)
On the other hand, Advisors can provide instant value inside your business while remaining a mystery to the world outside. The benefits are many, the drawbacks are few. No amount of money can buy access to a group of experienced business people that know your business and are willing to work together in its best interest.
The competitive advantages you can enjoy from this type of group are boundless, and have often been the difference between survival and thrive-al, particularly in tough times.
BRAINS, BRAWN AND BUCKS
Whether advisory in nature or formal, the benefits of a Board are many and the drawbacks are almost nonexistent. If done properly, a board will bring experience and wisdom that can only come through years of labor, trial and error.
Don’t assume you are the first person to ever have a problem, any problem, or that you have to figure out how to solve it on your own. There are plenty of people that have been there and done that. Ignoring that body of knowledge is a failure of leadership on your part.
Because they will have your best interests in mind, board members can open many doors that otherwise may be locked for you. They can identify sources of cash and potential clients. After all, what better way to market your business than through a group of people who have volunteered to help you make your business better? By simply being a good company you will create a pride of association that can expose your business to a limitless number of people in an infinite variety of environments and situations.
This one you may not like, but it’s true. The simple act of making yourself accountable to an external group of knowledgeable business people will drive you to make better decisions.
As I spoke to people in my network about using a board, the subject was a hands down no brainer – ABSOLUTELY! The topic they all wanted to talk about was how to create one.
Roger Akers, Principal of Akers Capital and one of the most giving, supportive investors I have ever met says “Goal setting, fund raising, business development, organizational development; all can be facilitated by the correct Board. Is it worth it? How lonely at the top are you?”
There are two key points I want to make on the subject of creating your board. First, you do not have to spend money to have a board. It’s nice to reward your board with cash, but it’s unlikely you can afford to pay them for their time and knowledge, so don’t try. Just feed them.
Many companies pay stipends to their board members, but most privately held and non-profit organizations do not. The reward for these board members comes through your success (achievement of goals) and expanding their network through the work they do for you.
The other key point is to give your board the utmost respect when they give you their time and wisdom. Be prepared to listen, and act on their advice. So, be careful, and select your board members wisely.
According to Oleg Kaganovich, Principal at DFJ Frontier, another local good-guy, “Find great advisors and good reasons for them to come and help you.” Remember, people like to back winners, and successful people are always looking for things that are new and interesting.
One of the many subtle benefits of a board has to do with culture, which has become more prominent in recent years. As time passes and we boomers retire in greater numbers, it will become even more so.
Having a board helps set the cultural tone for your organization. A good board, one that is collaborative, functional and action oriented will help you and your organization operate in the same manner.
The point I am trying to make is quite simple. Every business operating without a board, whether advisory and informal or a formal Board of Directors, is racing in army boots against competitors in running shows. You simply cannot compete as effectively with them. I challenge you – create a board right now if you don’t have one. All it takes is a phone call.
Have a question for Larry? Ask or leave a comment below!