Definition: A group of individuals who've been selected to help advise a
business owner regarding any number of business issues, including
marketing, sales, financing, expansion and so on; a body that
advises the board of directors and management of a corporation but
does not have authority to vote on corporate matters
An advisory board is an informal group of local business
professionals who can help you run your business better. And
because advisory boards are unofficial (i.e., it's not the same as
a corporate board of directors), you have a great deal of latitude
in how you set it up. Advisory boards can be structured both to
help with the direct operation of your company and to keep you
informed on various business, legal and financial trends that may
affect you and your business
Generally, you'll want a legal advisor, an accountant, a
marketing expert, a human resources expert and perhaps a financial
advisor. You may also want successful entrepreneurs from other
industries who understand the basics of business and will view your
operation with a fresh eye. If you don't personally know people
with those areas of expertise, don't be afraid to ask the most
successful people you can find. At best, you'll partake of the
knowledge your community's successful business leaders have. At
worst, they'll be flattered and say no.
When setting up the board, be clear about what you're trying to
do. Let your prospective advisors know what your business goals are
and that you don't expect them to take on an active management role
or assume any liability for your company or for the advice they
offer.
Advisory board members are rarely compensated with more than an
occasional meal. Keep in mind that, instead, your advisory board
members will likely benefit in a variety of tangible and intangible
ways. Being on your board will expose them to ideas and
perspectives they may have otherwise missed. It will also expand
their own networks, which can offer a wide range of advantages.
When holding actual meetings, you can go one of two ways: You
can either bring everyone together every month or two, or you can
meet with different advisors separately in a way that makes sense
to the issue at hand. It really depends on your business's needs,
what you're comfortable with and the dynamic you wish to develop
between your advisors.