Action steps for succeedin with a board of advisors: the first and often most difficult step as an owner/ceo is to admit you don't know everything. taking the time to put together a valued board of advisors will pay huge dividends.

• Author: Womack, Debbie
• Position: ADVISORY BOARDS

ASNIALL TO MEDIUM-SIZE BUSINESS that has an advisory board is rare in today's world. However, assembling a board of advisors may be one of the most important steps a CEO can take to assure the success of the company, giving the business a significant advantage over competitors that rely solely on internal talent.

To be the most effective, a good board of advisors, should be composed of objective, third-party experienced business owners. Generally, the board should not include friends, family, or anyone with an emotional interest in the business. Often advice from a friend, family member or management insider is sugarcoated to protect relationships. An outsider will provide a much more objective and honest assessment of the situations facing the business.

An essential and critical characteristic of a good advisor is that of being an informed listener. Other qualities include honesty, objectivity, specific knowledge outside your skill set, good reputation in his/her field and/or community, and being well connected with networks that can be leveraged to provide assistance.

One should carefully evaluate the cost of organizing and engaging a group of advisors to ensure that each is able to contribute. An owner/CEO should consider advisory board prospects carefully early on, even if no immediate action is taken to put them on the board. In addition, always keep an eye out for knowledgeable and experienced experts who might, in due course, be a good candidate for a spot on the board.

When looking for potential customers, sympathetic bankers, well-heeled investors, or talented new employees, the advisory board can provide a wealth of information. Sometimes a brief introduction by an advisor is all it takes to open doors that may have been otherwise dosed, or provide access to resources that may not have been available without their assistance.

Onboarding advisors Once a potential candidate has been identified, send a letter inviting the person to participate on the board. The invitation letter should explain how the business owner expects to benefit from the candidate's knowledge and experience.

Prospective candidates should mesh with all the other personalities of the other advisors, including that of the business owner. It can be politically difficult to release someone from a board, so instituting a policy of short terms of service is advisable. Terms of one year are typical. Toward the end of the term, extend an offer to the advi-sors you want...