Small Business Management Article Summary Best Practices for Successful Advisory Boards By Aleen Bayard and Cindy

y Burrell Ahmed Azam Khan The role of advisory boards is extremely important. This importance has increase d in recent times of the global economic recession. The importance is as follows : Advisory Boards provide an external viewpoint hence is good for identifying th e strengths of a business and at capitalizing on opportunities and favorable tre nds. The best part to this is that an Advisory Board provides guidance and influ ence at a much lower risk than that faced by Corporate Boards. The next question is naturally what should be the board composed of. In answerin g this question we must consider one thing; expertise first, relationships secon d. We must first pay attention to the qualification and expertise of a desirable board member as opposed to directly appointing someone who you know as a friend or a cousin. The best way to have a diverse expertise within a board is to crea te advisory boards which cater to niche segments. Different board members must h ave different experiences ranging from Business Development to Corporate Social Responsibility. One very important aspect or rather a duty of an advisory board is to make use o f its smart and well connected board members. Board members should have a large personal and professional network which would help the business in more than one way. Smart board members are those who know how to leverage their past knowledg e, their board experience, and their strong networks for the interests of the co mpany. But what attracts professionals to become a part of advisory boards which give t hem very little benefit in terms of money. Members might not ask for compensatio n initially but down the road, demands will be raised that will have to be met. Lack of providing an honorarium might lead to a conflict in interests eventually . The conflict may also exist otherwise due to the presence of board members on other advisory boards. Sometimes, the other boards include those of competitors. To successfully avoid such conflicts, roles and responsibilities of the advisor y board must be clearly laid out and written to avoid any confusion. At the end of it, management should also be equipped to evaluate the efficacy of these boards. This would give them an insight on how successful or unsuccessful an advisory board is for their company. In totality, an advisory board if used properly would catapult the business in the right direction.