Many small business owners are often gripped with the fear of “being alone.” Of not having anyone to bounce ideas off of or share concerns with.
In larger firms, there may be key employees or colleagues to share with… but not so much in smaller firms. Masterimnd groups seem to be very popular, but are often full of competitors. And most businesses are too small for a formal Board of Directors. So, what’s the solution?
According to Rachel Crenshaw, founder of Strategy Sourcing Solutions, “Every small business owner could benefit from having an Advisory Board.”
In a recent interview with Ms. Crenshaw, she shared with me how her Advisory Board came to be and how she leverages it to help her run her small business…
Henke: Rachel, let’s start with the basics. What is an Advisory Board?
Crenshaw: From my perspective, an Advisory Board is a group of business professionals who are willing to give of their time and energy to help me with all aspects of my business. They are willing – not because I pay them, though there is a modest amount of that – but because we have a deep and trusting relationship. In fact, they are my friends and help because they care about me, my family and my business.
Henke: Where did the idea for an Advisory Board come from?
Crenshaw: From my husband, actually. When I was thinking about starting my business, a key piece of advice he gave me was to “surround yourself with good people.” Knowing that I would be a solo operator for a while, the idea of an Advisory Board seemed like a good way to do that.
Henke: How are your advisors similar to and different than a Board of Directors?
Crenshaw: Similar, in that they are there to help… to provide ideas and guidance, to give me feedback, to help vet ideas and to be connectors with potential clients and others in the business community. And different in two key ways… one, is that they are pretty poorly compensated (sorry guys!) compared to a Board of Directors. And two, there are not rules for their involvement… no official Board meetings, no notes that have to be recorded, and so on.
Henke: Are there any limitations on the kind of firm that should consider assembling an Advisory Board?
Crenshaw: Not at all… nearly any size firm, in any industry, serving nearly every kind of customer is a candidate. The one key factor is the business owner… he or she must be open to the idea of having the board, of sharing with the board and of asking the board for help.
Henke: Specifically, how do you and your firm benefit by having an Advisory Board?
Crenshaw: For one, they give my firm a higher level of legitimacy and credibility. I’m not just a lone wolf out in the marketplace, but I’m supported by this high-caliber group of professionals that are also on the team. In addition, they give me hands-on support, connecting me with others in town, directing me toward specific project solutions, and helping me understand the challenges and obstacles in the industries we serve.
Henke: How did you select your board members?
Crenshaw: It was actually pretty easy… I started with friends who were accomplished in their respective fields or industries. As friends, everything started with a foundation of trust and I knew they would be a good fit and work well together. As we expand our business – into new vertical industries, for example – we will likely expand the Board. And as current members roll off, will we replace them.
Henke: OK, so what’s the process. How does your Advisory Board work?
Crenshaw: As I mentioned, since the group is not a Board of Directors, there are no real rules. And, in fact, I keep things pretty informal. First, as specific business situations arise, I will call on the one or two Board members who, I think, might be able to help with that particular situation. As big project opportunities come up, I keep all of them in the loop… I never know which one might be able to help with that particular client or prospect. The one structured thing I do is send out a quarterly business update, keeping them apprised of all things related to the growth of the firm.
Henke: What about group meetings?
Crenshaw: Actually, we’ll be having our first one this year. While there really hasn’t been a need for one, I want to bring the group together so they know they’re part of a pretty special team. I think it’ll be a lot of fun, too.
Henke: Aside from being a friend, why would someone want to participate in an Advisory Board? Why would they want to help?
Crenshaw: You can’t really put the “friend” thing aside… it is a key reason they help. But beyond that, they also believe in my business concept and business model. They believe we’re going to succeed and they want to be a part of something like that. Plus, they all share in the profits of the firm… it’s not really all that much money, but more a tangible way for me to say “thank you.” Finally, they get connected with one another, expanding their network and spheres of influence.
Henke: If a fellow business owner is interested in starting an Advisory Board, what advice would you give them?
Crenshaw: Just two things. One, select people who not only excel in their professional ventures but those with whom you also have a strong relationship. The key to success is complete trust… that’s the foundation of all of this. And two, go into the process with confidence… confident that this Advisory Board can really help you and confident that the board members also get something out of it – that they are genuinely helping one of their friends… you.
Henke: Thanks for your help, Rachel… and continued success in 2019.
Bottom line: If you’re a small business owner in need of expanding your support network and bringing new perspectives and resources to bear on the growth and success of your firm, it might be time to consider assembling an Advisory Board.