CEO advisory group formation tips

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CEO advisory group formation tips

  1. 1. STL ≈ABC Saint Louis Advisory Board Council Saint Louis, Missouri, Fall 2010 Advisory Boards Can Help CEOs Overcome Uncertainty Chris Bylander is a Saint Louis district leader to the White House on job creation and a member of both The Economist Intelligence Unit (EIU) Leaders’ Panel at The Economist and the Market Advisory Board of Bloomberg BusinessWeek. He is sharing his experience on how to handle the uncertainty of today’s business climate. We can all benefit from advisers—they're the friends from the trenches who have been on the business battlefield longer than we have. Or they're friends from a different industry or field who provide a unique perspective. Or they're seasoned or high-profile executives who lend you credibility, thus helping you secure customers, financing, or a crucial introduction. You need advisers to bounce ideas off, to provide a reality check, to tell you when you're about to mess up, to confide in when you're alone at the top. A board of directors has a fiduciary responsibility to the company. They can be liable for mistakes (accounting and otherwise) that a company makes. So it's tough and expensive to secure board directors, especially since Sarbanes- Oxley. But advisory board members don't have fiduciary responsibility, and thus cannot be held liable. Hence their compensation is a fraction of what a board director receives. Further, board directors have an obligation to the company first, and the CEO second. It's the opposite with advisers—the CEO comes first. A good adviser is still looking out for the company, but their aim is to steer you in the right direction to best care for the company. Here's a process for getting and keeping advisers on your team. Remember: Life equals the people that you meet plus what you create with them. Let's start meeting and creating. Do this: 1
  2. 2. STL ≈ABC Saint Louis Advisory Board Council Define your advisory board member profiles. This is a list of skills and connections you want advisors to have. Determine your expectations of each adviser. You will want to interact with them on a regular basis. Create your pitch and comp package. Why should someone become an adviser to you? What's in it for them? Getting involved in a developing company in a super-cool field? Access to thought-provoking people, such as your executive team and other advisers? Brainstorm your target list. This, my friends, is where you work it! You will be glad you've invested time in building your network, because it's about to pay off. Ask your friends, colleagues, mentors, vendors, and financiers if they know people who meet the profile you seek. Seek out your targeted advisers and recruit them. Celebrate, incorporate, and communicate. After celebrating your good fortune in securing some rocking advisers, it's time to incorporate them into your company's communication flow. Carefully consider offers from for-profit “coaching companies” who charge annual fees but promise nothing in return. You may end up feeding owners of another enterprise, not yours. For free information on how to form an advisory group for your company, contact Chris Bylander through LinkedIn.com, by phone at 314-578-4808 or by email at chris.bylander@sbcglobal.net 2

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