March 28, 2018. By Ashley Agnew:
On Tuesday, March 27th Centerpoint sponsored an event alongside XPX New England and the Northeastern University Center for Family Business called “Finding the Right Advisors”. The panel addressed the concern that many private companies do not pursue the advantages of comprising a formal advisory board. We found this XPX New England event to be particularly interesting as many of our clients are small business owners who seek assistance in this area.
The panelists each had a different perspective of the advisory board-building process. Chip Johns, President and CEO of Butler Automatic shared his perspective as a business owner, noting that being the CEO is a “very lonely job” with few trusted individuals with whom the CEO can speak honestly and openly. He continued his thought sharing that a board of advisors not only provides a sounding board for ideas, but also allows the CEO to have an audience of individuals who truly understand your business. He found that one of the greatest advantages of an advisory board is that a “board of advisors gives you an unvarnished view of your business”.
Panelist Ted Clark offered opinions from academia as the Executive Director of the Northeastern University Center for Family Business. He has witnessed the positive impact that advisory boards can have first-hand not only in his own family business, but also in the many he has studied and assisted through the Center. Clark felt strongly that the first step in forming a board is to answer the questions “why do you want it and what do you want it to do?” Answering these big questions will help the CEO to choose advisors with the right set of expertise to achieve the goals of the board. To keep momentum moving toward these goals, he recommends setting three-year terms for board members to adjust to the changing needs of the business over time.
In a room full of successful business women and men, it was the consensus that a board can add tremendous value to any business. Moderator Jack Finning of AAFCPAs presented a question to the panel that was overheard in many of the discussions during the networking hour: what qualities do you look for in an advisory board member? Speaking from the point of view of a CEO and business consultant, Rudi Scheiber-Kurtz, Founder of Next Stage Solutions, blended her thoughts from each experience to recommend that advisory board members possess 1) a strategic mindset, 2) a collaborative personality, and 3) a strong understanding of which stage your business is currently in relative to its overall business cycle. Johns and Clark agreed that assuring each member fits this criterion will increase the likelihood of success.
In working with many business owners, we have seen how the formalized advice and focused input that a trusted board of advisors provides can positively impact a company. Though a thoughtfully crafted board can truly be a great asset, the vetting process can often be a challenge. Luckily, there are firms, events, and printed resources to assist in the process. If you are a business owner, or if you act as the CFO of your family, we are happy to introduce you to the professionals that will streamline your personal and professional management actions.