Ad­vi­sory boards that work

The Pak Banker - - Front Page - Verne Har­nish

MARISSA Levin more than dou­bled her rev­enues at In­for­ma­tion Ex­perts in the past three years, and she's the first to tell you she couldn't have done it alone.

Her se­cret sauce: A great ad­vi­sory board. About three years ago, the founder and CEO of the 18-yearold strate­gic com­mu­ni­ca­tions con­sul­tancy turned to a men­tor for help in grow­ing In­for­ma­tion Ex­perts.

"My com­pany was stuck at $5 mil­lion," she says. "I couldn't get past cer­tain road blocks."

Her men­tor ad­vised her to put the board of ad­vi­sors in place. "He said it's a group of peo­ple you hand se­lect that can get over your prob­lem," she says. "That con­ver­sa­tion sparked a light bulb for me."

Last year, the firm, based in Re­ston, brought in $11 mil­lion () in sales. She's been so happy with her ex­pe­ri­ence that she's even writ­ten a book to help other CEOs, called SCALE: How Top Com­pa­nies Cre­ate Break­through Growth Through Ex­cep­tional Ad­vi­sory Boards. If you don't have an ef­fec­tive board of ad­vi­sors in place, now is a good time to start putting one to­gether.

Levin in­vested nine months in re­cruit­ing the right board mem­ber­sex­perts who can help her strengthen the com­pany in key ar­eas. Her 6mem­ber board now in­cludes an en­tre­pre­neur who sold a $55 mil­lion com­pany who has helped with project man­age­ment, and the for­mer head of one of the gov­ern­ment agen­cies her firm works with, who has sparked busi­ness de­vel­op­ment. "He's been in­stru­men­tal in mak­ing in­tro­duc­tions for me and lead­ing me to mil­lions of dol­lars in work," she said. One of the big mis­takes that growth com­pa­nies make in choos­ing an ad­vi­sory board is that they're too re­laxed about it.

That won't get you very far. Ask John DeHart, CEO of Nurse Next Door, a 60-unit fran­chise chain based in Van­cou­ver. About five years ago, the home health care com­pany, which he co-founded with Ken Sim, brought on three ad­vi­sors. Meet­ings were held ev­ery two months, and though the com­pany would send the ad­vi­sors a re­port two weeks be­fore the meet­ings, ev­ery­thing was pretty in­for­mal.

Re­sult: "It just ended up stop­ping," he says. But DeHart didn't give up on the idea.

About a year ago, the com­pany formed a new board and brought in three new ad­vi­sors to help with mat­ters like the tran­si­tion from two CEOs to one (Sim, orig­i­nally coCEO, has shifted his role into strate­gic projects). They meet ev­ery month for four to eight hours and held a two-day an­nual re­treat. The com­pany makes it worth their while fi­nan­cially.

The new board has re­quired Nurse Next Door's team to stay on top of key in­for­ma­tion-from fi­nan­cial met­rics to risk fac­tors-on a con­stant ba­sis. "Ev­ery sin­gle month, I and my en­tire team have to do for­mal re­port­ing to the board," says De Hart. "It's made us so much more dis­ci­plined in our ac­tions and thought." When Mike Fer­ranti started his New York City com­pany, Endai World­wide, in 1999, dur­ing the dot­com era, he set up a six-per­son board of ad­vi­sors from well­known firms. But it was hard to get the ad­vice he needed from them. "They were big com­pany guys," he says. The web an­a­lyt­ics com­pany, which now man­u­fac­tures its own email mar­ket­ing soft­ware, tried again and set up what Fer­ranti calls "Ad­vi­sory Board 2.0" in 2008. The three-per­son board, made up of mar­ket­ing pro­fes­sion­als with ex­pe­ri­ence in im­por­tant niches, is much more hands on. Fer­ranti pays them to at­tend meet­ings and some­times to tackle con­sult­ing projects.

The "in­tel­lec­tu­ally chal­leng­ing de­bates" he has had about strat­egy with his board have led to de­ci­sions that have helped the com­pany grow.

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