Shortly after I wrote my September newsletter article titled “Integrating Diverse, Outside Perspective with Inside Strengths”, I saw an interesting article about advisory boards. Advisory Boards can be a mechanism for integrating diverse outside perspective with inside strengths. So, I decided to do this blog post about advisory boards, where I not only talk about the article, but also tie in key points from my September newsletter.
The article is “Best Practices for Successful Advisory Boards” by Aleen Bayard and Cindy Burrell, which appeared in the September 2012 issue of The Corporate Board. The article provides a good discussion of how to set up advisory boards and how they might be used. It discusses best practices, including how to go about recruiting and compensating advisory board members. And, it talks about potential pitfalls related to conflicts of interest and confidentiality. It also includes good examples of specific companies and their advisory boards.
Advisory boards are a way to bring fresh, outside perspective into companies. And, as I discussed in my September newsletter, outside perspective helps companies keep abreast of important external information and trends that insiders might otherwise miss. This external perspective can play a vital role to help companies change with the times and evolve successfully.
But, as my September newsletter pointed out, companies must do more than merely bring in outside perspective. For success to come about, outside perspective must be used in an effective manner. This means integrating the much needed fresh perspective with what is already there in the company. Thus, fresh perspective from advisory boards must be screened so it can be harnessed in a way that meshes nicely with the company’s strengths. Unfortunately, however, outsiders with fresh perspective do not always fully grasp a company’s strengths.
Furthermore, CEOs or other executives making use of advisory boards may not fully grasp the similarities and the differences between their own companies’ circumstances and the circumstances faced by outsiders on the advisory board. But, if the chasm between the inside and outside perspectives is too wide, successfully implementing those fresh, outside ideas can be difficult. That’s why outside ideas must be thoughtfully evaluated, ideally by someone who understands both the inside and outside viewpoint, before those ideas are adopted. This helps insure that advisory boards’ suggestions can, in fact, benefit the company and do strategically build upon strengths.
So, in summary, companies should tap the tremendous value of outside perspective. Outside perspective can be a valuable resource that helps companies change and evolve successfully. Advisory boards can be a way to obtain valuable outside perspective. And, the article by Bayard and Burrell provides a good discussion of how to do this. But, once the advisory board is set up and that much needed outside input comes in, companies should pay attention to the kinds of business success patterns discussed on this website, be highly selective about which outside ideas to adopt, and strategically focus on those outside suggestions that best fit the company’s strengths.
