The pros and cons of an Advisory Board

By Olivier Dellacherie, Executive chairman, Talent4Boards Inc.

Below are the pros that we have gathered in various papers, blogs and websites about the topic.

While most of the time, they emphasize a few benefits, others have pointed out specific features, and therefore we consider interesting to combine them into a “pros” list. And as an advocate of the use of an advisory board, we left someone else’s responsibility to write the “cons” list.

Strategy, Innovation

• Boost and foster the CEO’s strategic capacity,
• Analyze market conditions,
• Are sources of ideas or trends,
• Recommend technological innovation,
• Suggest product or service changes.

Source of advice

• Bring a wide range of experiences and perspectives to the company,
• Empower CEO/founder to make smarter and more effective business decisions.

Independence

• Provide a set of “fresh eyes” for the organization.
• Give independent and honest advice.
• Will be on the side of CEOs.

Assistance, business development

• Help CEOs grow their company,
• Help with business deals,
• Bring new business and revenue opportunities,
• Can pro-actively assist CEOs for specific tasks, in order, they can devote most of his/her time to business development.
• Support entrepreneur, so they don’t navigate unfamiliar waters alone.

Cost-effective

• Provide a talent pool that they could not usually afford.
• Be an inexpensive alternative to a formal BOD.

Efficient

• No fiduciary responsibility.
• Structure problem solving
• Create an organized process to discuss business opportunities and concerns.

Value creation

• Branding the Company thanks to having recognizable names on board,
• Be an essential asset in the valuation of the company.

Networking

• Broaden networks and encompass the business vision

Mentoring

• Bring opportunity for mentoring relationships
• Mentoring thanks to the combined experience,
• Share difficult issues.