Survey – what is the role of advisory boards?
I did a survey of people on my LinkedIn network who are on an advisory board or a CEO with an advisory board. This survey was done because I was appointed chair of an advisory board and wanted to learn from others. If you are an advisory board member or chair, please contact me – I’d like to include your learnings.
The following contains the email I sent out as well as the responses, which are anonymous.
The email I sent out
I have a few questions regarding what sort of things you do for your advisory board (I saw your role on your profile). I ask because I’ve been appointed chair of an advisory board for a financial services firm and need to resurrect the board. I need to learn some details about what other advisory boards do.
- Prepare for and attend regular face-to-face meetings?
- Available for consultation between meetings?
- Serve on advisory board committee?
- Introduce potential clients to the firm?
- Spend time with potential clients?
- Introduce other executives to the firm?
- Provide new business ideas and opportunities?
- Promote the firm via your personal social media (twitter, website, blogs, Facebook, LinkedIn, etc.)?
- Provide suggestions and advice regarding functional areas (sales, marketing, finance, HR, etc.)?
- Have functional meetings outside of regular advisory board meetings?
The anonymous responses
Advisory Board #1 member
That’s right on the money It’s really an opportunity to bring strategic resources and thought leadership to an organization People on the boards usually have some expertise that you can draw on including Sale’s, marketing, finance and leadership. The chair is the quarterback to draw out that experience and knowledge.
Advisory Board #2 member
Happy to help you if I can.
As of this past month, I am Chair of the Program Advisory Council for the XXX program at the XXX School of Business. We basically work with the faculty and students to help support and improve the overall program and the various components within it.
I am also an XXX Advisor on the Board of Directors for the Canadian XXX Council I provide the “XXX” on that Board with a CIO perspective on the various issues that they deal with. In addition, I do serve on various Committees of the Board along with the other Board members. So, I am not sure that my experiences are directly compatible with your Advisory Board role question. However, along with my other two Board of Director roles, I would say the possible actions of #1, 2, 3, 6, 7 and 8 fit best with my general understanding of what needs to be done.
Advisory Board #3 member
My role is for a small co (very) and it’s really ad hoc to have a halo support group with supplementary skills. If yours is bigger then the types of things you describe could be formalized and scheduled. You want to be mindful of people’s time. Maximize their value add at the time their skills/connections are most useful, minimize procedure…. my 2 cents Congrats and good luck!
Advisory Board #4 member
It can be whatever you define. At the minimum is for pick up the phone when the ceo needs and can go to everything else in your list. At this point my commitment is limited to picking up the phone as I am busy with my own startup. Hope this helps.
Advisory Board #5 CEO who had an advisory board
- The role depends upon the stage of the company and the growth/profitability issues a company faces.
- In all cases, the network of the advisor is critical. At the very least, the network provides information to the advisor. In some cases, the advisor may introduce: potential customers, potential investors, potential suppliers, potential new employees.
Where do you find advisors?
- They can be senior executives, towards the end of their career, who are somewhat bored and eager to work with other executives on some challenging issues.
- The executives could come from: current customers, potential customers, other organizations in the company/customer ecosystem.
- It is key that all advisors be “A” quality. If some are “B” or “C”, then the “A” quality will leave.
What is the role of the advisory board?
- The advisors provide advice to the CEO and perhaps management.
- The advisors must have skills, experience relevant to the challenges and issues the company will be facing in the next 2-3 years. g. if going public, then need CFO or another executive who led an IPO.
- Advisors should complement the knowledge, skills, and experience of the management team. e. The combination of the advisory board and management team should have the knowledge, skills, and experience relevant to the major challenges and opportunities arising in the next 2-3 years.
- The board does not make decisions. Thus, requires less information than a decision making fiduciary board. A dashboard of key metrics is useful.
- The role of the CEO and management is to listen and learn, not to make long presentations.
- Set the expectations for advisors upfront. Consider a fixed two-year term.
- If there are 6-8 advisors, there will be a 80% participation rate.
- There should be no dominant personalities on the board, recognizing that the chair should enable the discussion.
- The advisors must provide unvarnished input to the CEO and management.
- Each board meeting and call can be a problem-solving discussion focused on the issues raised by the CEO. It’s not necessary for the advisors to agree on a single solution – what’s important is to maximize the input and learnings to the CEO and management.
What was the advisory board role when you were the CEO?
This was a company with a fiduciary board of directors.
- The advisory board had a one-day meeting down south in the winter. Fly in day before for dinner. One day meeting, then fly out. The CEO and management attended.
- Three quarterly advisory board conference calls of 1-2 hours each.
- All meetings/calls were scheduled 1 month prior to fiduciary board meetings, to enable CEO to learn regarding key issues – almost like a dry run. The CEO also shared strategy and strategic plan with the advisors, to get their comments.
- The CEO and management also made occasional phone calls to the advisors.
- The advisors received material before meetings/calls. This enabled the meetings to focus on discussions and not review of material.
- The advisory board chair was paid $25,000 per year. The advisors were paid $500 to $1,000 per-diem, with out-of-pocket travel costs covered.