Why your family business needs an advisory board

Whether you’re a small start-up or a multi-generational family business, having a group of experienced advisers can enhance your management’s breadth of expertise.

So, what exactly is an Advisory Board?

Aside from being a well-proven business model worldwide, an Advisory Board is a group of experienced businesspeople who are strategically selected to support, challenge and assist you with your business plans and strategies.

Advisory Boards perform a similar role to that of non-executive directors often found in larger family businesses, ultimately helping them towards their specific goals.

This “mock board of directors” will usually come together to work with you and your leadership team over a designated period of time, providing access to their knowledge and resources.

Advisory Boards can be an incredibly valuable tool, combining the benefits of a team of consultants, a focus group of customers and specialist industry experts – all rolled into one! The key is to make the most of them, by ensuring that you are honest and upfront about your business and your ambitions, by asking the right questions and by being open-minded and prepared to listen to (& implement) the best of their ideas.

When might an Advisory Board benefit your family business?

Timing is important when considering an Advisory Board. As a family business owner or leader, you should have a specific goal in mind beforehand, and be able to identify any areas of expertise that would be beneficial in your Advisory Board.

Seven reasons to appoint an Advisory Board

 

1.Family businesses who do not have a formal board structure find Advisory Boards particularly valuable. They not only benefit from the knowledge, insight and fresh perspectives of their board members, but they also gain experience of having a formal board structure with minuted meetings and actions taken.

2. Another benefit for family business which are led predominantly by one person is to gain a sounding board for ideas and strategy. Sitting at the top of any business can be a lonely and stressful place, particularly when it comes to decision-making. An Advisory Board would provide that support and advice which can be a lifeline when the business is facing challenges and critical decisions.

3. Impartiality is the reason that some family businesses decide to appoint an Advisory board. If you have an existing board of directors in place, they may be a great asset to the company, but sometimes having impartial advisors to offer fresh insight can be useful to avoid the “can’t see the forest for the trees” situations.

4. Risk management also comes into play with Advisory Boards. As a preventative measure, an Advisory Board can give a company and its management team an opportunity to gain valuable insight and make critical realisations without having to learn the hard way. They can then set aside the time required to take the necessary actions to avoid making costly mistakes.

5. Advisory boards bring that wider business experience, context and contacts which family businesses can tap into to help with key business objectives. Whether this be gauging future trends, improving operational efficiency or building repeat, quality customers.

6. Unlike a board of directors, Advisory Boards have no authority over the CEO or the management of your company. Your organisational filings have no requirements to listen to your Advisory Board. Therefore, there is no risk in ignoring their advice, except losing the benefit that might come from taking it. Likewise, your Advisory Board members have no legal exposure or fiduciary responsibility to your company.

7. Financially, having an Advisory Board comes at a fraction of the cost of employing the services of several specialist business consultants. The time involved is the main ‘cost’ but the potential rewards usually vastly outweigh any time invested.

What do previous participants think of the Advisory Board programme?

Our Advisory Board Programme has now been running successfully for several years, with dozens of family businesses having completed the programme.

Andy Douse, owner of an internal communications company joined the Programme in April 2021. After the pandemic, his business was facing difficulties.

Andy commented, “Joining the Advisory Board programme after Covid was a blessing for us. We knew we had to adapt our business but didn’t know how. Our Advisory Board helped us to look after our customer base and realise that we needed a new brand, a new website and a digital strategy.

Andy added, “My advice to other family businesses would be to make the time and go for it. The Advisory Board programme is a great opportunity purely for the wealth of expertise from people who have been there, done that and got the t-shirt. The quarterly meetings make you commit to the programme and help to push things along that may otherwise have slipped back.”

Family business owner, Gina Pennington joined the Advisory Board programme in 2021, facing numerous pandemic-related challenges.

Gina explains, “Joining the Advisory Board programme as we went into lockdown number three couldn’t have come at a better time. It was good to have something positive to focus on and the time to do it. 

As tea and coffee merchants, we knew we had to adapt our business as 70% of our trade was closed due to the lockdown.  Our Advisory Board helped me to really focus on who our customers were and how to get the basics in place, creating our Business and Value Proposition model and then implementing it into our daily working life. 

Gina added, “Having the quarterly meetings really helped with accountability to make sure that things got done.  It has been invaluable to be part of the Advisory Board programme, having the varied wealth of experience to guide and advise us”.

It’s not just the businesses who benefit from the process. Many of our Board members talk about their positive experiences from being involved in the programme.

Mark Booker, an independent Business Advisor previously working in Senior Management at BAE Systems joined our programme in 2020.

Mark said, “It was refreshing to work with smaller companies. It opened my eyes to a whole new world and I found it fascinating to hear peoples stories. It made me realise that I wanted to do more of it and overall, I have really enjoyed the process.”

“In my experience, joining the Family Business Advisory Board Programme offers access to experienced businesspeople who are involved for the right reasons. You gain independent, unbiased input, support and guidance. When you’re responsible for making decisions in business which people’s livelihoods rely on, this support can prove invaluable.”

How does it work and how do I get involved?

The programme runs over a twelve-month period and we work with you to create a suitable group of Board members, facilitate four quarterly meetings (these are run to an agenda and minutes will be taken, with actions to be implemented) and are there to support with any ongoing advice.

To register your interest or arrange a call, simply email team@fambizcommunity.com and we will happily get in touch.

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