“Every company can benefit from a well-structured advisory board. External advisors bring networking opportunities and much-needed advice, but most importantly they bring something that is priceless to any successful business: an outside perspective.” — Karl Stark and Bill Stewart, Why You Need an Advisory Board, Inc. 5000
An advisory board is an informal group of individuals assembled to provide strategic council to your organization. It differs from a board of directors in that members have no decision-making capabilities; they exist simply to provide outside advice and support as you grow your business.
Because it often brings added knowledge, experience or connections to the table, an advisory board is an extremely valuable asset at all stages of your agency’s growth and development.
Building Your Agency Advisory Board
To build your advisory board, we recommend first assessing your agency’s, and management team’s, strengths and weaknesses. The best advisory board candidates will be able to fill a gap in your existing knowledgebase—whether that be specific industry insight or vertical expertise like HR, finance or legal.
Next, map out what the perfect advisory board would look like, and compile a potential candidate list. In terms of board size, Inc. recommends 3-5 outsiders, who each bring their own unique value to the group.
To fill the roles, your existing network is a great place to start. Consider business owners and professionals, university professors, former colleagues, friends, family, and industry connections.
Most importantly, make sure that the individuals selected are people that you respect and trust. They will, after all, be offering advice into agency strategy, operations and vision.
With a candidate list in tow, personally approach each individual with your proposition, including details on time commitment, compensation and why you think they are the ideal fit.
When it comes to compensation, small business coach Marla Tabaka (@marlatabaka) explains in Why YOU Need an Advisory Board that, “most often, the members of a small business advisory board want to do it because they too have a passion for business and a genuine desire to help someone succeed.”
However, it doesn’t hurt to offer gifts or small stipends in return for someone’s time. In fact, in Entrepreneurship: How to Assemble a Board of Advisors, John L. Ward, author of Creating Effective Boards for Private Enterprises, recommends paying board members the same base hourly rate you make as an executive to signal you respect their time as much as your own.
Evolve Your Board as You Grow
Keep in mind that your agency’s needs and challenges will evolve over time. Don’t be afraid to revisit your board selections from time to time, and evaluate whether they are still a fit moving forward. It’s okay to adjust your board as you grow.
Do you have an advisory board? Share your recruiting, management and compensation strategies below.