One of the most frequent questions I am asked by CEOs and senior business executives is how do I know when I should get a business advisor or have an advisory board? My response is always the same, why do you think you need one?
I was surprised that the answers most often could be categorized into two primary buckets: specific knowledge gap or a “lonely at the top” syndrome (nobody to talk and bounce ideas). My initial advice to them was to develop a “network” of peer executives that you could share challenges and exchange ideas of how to approach and resolve. Or you could look for a seasoned business advisor to work with you and your company.
Whether you need specific knowledge or need general business advice, there are many aspects to consider when hiring an advisor or putting together an advisory board. The first thing is not to confuse an advisor or advisory board with your board of directors. Advisors or advisory boards provide business advice and are individuals who lend their expertise, network and wisdom to the business. A board of directors is more about legal governance.
My advice to CEOs and senior executives on how to hire an advisor is to:
- Identify what you don’t have in your organization but need: experience and knowledge
- Identify people who can meet your needs: gather referrals and create a short list of names and interview two or more candidates
- Define expectations: Can I call or email you with questions and expect a response within 24 hours?; Outline specific requests and timeline such as quarterly reviews of budgets, KPI and ROI review of marketing and sales spend, review department processes, evaluate resource options for required marketing services.
- Have clear understanding of compensation.
- Find people who have passion for your company and products and helping your business succeed.
- Most importantly, ensure you trust them and they can provide wisdom in their advice versus just knowledge.
I believe trust and wisdom is key to a successful advisor relationship. Trustworthiness is essential. But wisdom of advice can be the difference between success and failure. I once explained to a CEO I was advising what I meant by the need for wisdom, “knowing a tomato is a fruit is knowledge, knowing not to put it into a fruit salad is wisdom”.
Tom Angelis is Managing Partner at Angelis Consulting Group. He brings a unique set of entrepreneurial, marketing, financial and business process skills that have consistently provided high growth and profitable results.