When making important business decisions—everything from where to export, how to connect with customers and what will give you the edge over your competitors—an advisory board can be an invaluable asset.
In French, we use the expression, “deux têtes valent mieux qu’une,” which essentially means it’s always better to surround yourself with the right people to help you make better informed decisions. Having the support and expertise of a body of outside experts can boost your confidence level as a decision-maker and help set your company on the path to success.
Five things to know about advisory boards
1. They don’t make decisions for you: Unlike a board of directors, an advisory board is voluntary and has no legal liability to your company or formal decision-making powers. Its role is to provide external insights, timely knowledge and critical thinking to enable you to set long-term goals, find new opportunities in your target markets or overcome specific business challenges. It’s a source of independent business expertise and mentorship with a scope that ranges from helping you develop your company export plan to exploring innovation, risk management solutions and new profitability strategies.
3. Size doesn’t matter: Even the smallest company can benefit from the support and expertise of an advisory board. Having a committee of experts to listen to your ideas, discuss personnel decisions and analyze your year-over-year sales or recommend new markets of opportunity can be instrumental to your company’s growth, productivity and expansion.
4. They can open doors for you: Leveraging your board’s networks to connect with potential customers, partners or suppliers is a major benefit. For example, they can introduce you to key people in a new market where you want to expand, provide contacts to build your own networks and help boost your credibility and reputation in the business community. According to a report by the Business Development Bank of Canada (BDC), only 6% of Canadian businesses use an advisory board, but when they do, their sales and productivity often increase.
5. To be successful, everyone has to be transparent: Sometimes, an advisory board doesn’t work because the company founders and managers don’t share all the information about the business with the board members. Honesty and transparency are paramount for the board to successfully fulfil its mandate. By withholding details about your day-to-day operations, annual sales goals or international investment ventures, the board doesn’t have an accurate picture of your business and therefore, it can’t provide the strategic advice or sound recommendations you may need to move forward.
For more information about advisory boards, tune in to Export Development Canada’s French webinar on Aug. 25.