Your small business is currently in the growth phase. Perhaps, the growth has been slowing down. Maybe you’re working towards an annual goal of five years to acquire investors or acquire. Perhaps you’re not equipped with the experience required to achieve a crucial strategic business goal. In general, it’s at these points that a small-sized business might require a group of advisors.

I am an ICD.D certified corporate director and CEO of a tech company that has been a member of advisory committees (and fiduciary board) of all sizes for over 20 years; I believe that small-sized businesses often are waiting too long to have an advisory board set up.

Advisory boards have more of an impact in guiding businesses in the early stages to expand and innovate and increase their profitability over a larger company that is firmly rooted in its practices. Additionally, their composition and structure of compensation make their structureless “binding” and more readily be set up for startups or smaller companies.

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Although most business owners are aware that unlike a board of directors, an advisory board is not a board of directors and is not legally obligated to provide responsibilities to its stakeholders, many do not think that being free of fiduciary duties could open the doorway to a pool prominent business executives. Many business leaders want to stay clear of the publicity, reputational and legal risks of the directorship of a new company; however, they might still want to share their experience and connections with businesses they feel is worthwhile. With fewer formalities and fewer liability risks, advisors can give their opinions, information, and even the nitty-gritty guidance on everything from operations to personnel issues.

As the CEO and the management team create advisory boards to serve the needs of a business at a particular stage of its development and development, they don’t have to have a specific size. My business’s advisory committee has been a mix of two and four advisors, based on our goals for strategic development at the time, the type of experience we were looking for, and who was on our list of candidates.

Advisory boards don’t need to adhere to a certain period. Many small companies and advisory board members favor lengths between one and two years, which is enough time to comprehend a company and assist in achieving its goals fully. However, advisory boards can be increased, decreased, or replaced based on business demands.

Additionally, compensation for advisory boards can be a discretionary expense, making the board less costly for small-sized companies. Advisors are willing to provide their services free of charge and, as the company gets more established, move to a fiduciary position. To engage in more lengthy meetings, firms can opt to pay a per-year or per-meeting fee, pay for expenses related to travel and meals, or provide an equity stake in exchange for greater participation.

With the fundamentals of advisory boards covered, we’ll look at five important ways advisory boards could help small-scale businesses that are just starting:

1. Business Expertise

As founders, it’s not hard to be overwhelmed by your head in the beginning years of running a business. Even with a solid management team and a network of experts to talk to, you’ll lack understanding and experience as you face new issues and opportunities.

Through systematically identifying the skills that your company is lacking early–sales strategy, family governance, and succession planning, as well as regulatory compliance and compensation structures, etc.–you may seek out consultants to help fill these gaps and build your expertise in these areas, which will benefit both the growth of your company as well as your leadership abilities.

2. Credibility

This is particularly important for small and new businesses as well as startups. Working with knowledgeable and well-respected, dependable advisers who are sector or industry experts boosts trust and builds confidence among vendors, investors, employees, customers, potential candidates, and the general business community. Their involvement in your company can be a sign of trust, which can boost reputational and public relations value.

3. Network Expansion

Startups are intensive, take a lot of time, and can place networking off the agenda. Networking is crucial to giving your new boost to business.

Senior business leaders who sit in advisory committees have a history of sharing their knowledge within their networks and resulting in many top-quality business contacts. They can use their networks to connect you with subject-matter experts, trusted suppliers, carefully screened employees, Strategic partners, and even potential financial funders, thereby increasing your company’s visibility within the industry.

4. Rigor

In many businesses, especially startups, speed is still a coveted feature. Minimal viable product. Fast and rash, breaking things. Make mistakes more quickly. The picture is clear.

Although this attitude can be a catalyst for growth, it is not good and maybe harmful over time when things go wrong, technical debt builds up, and customer service is hampered. An advisory board that is well-established will force companies to reflect and be able to report, justify their decision-making, be open to other or opposing viewpoints, and examine their assumptions. It helps businesses find a balance between short-term goals and long-term viability.

Being accountable fosters the rigor needed for long-term success and a healthy lifestyle and encourages the creation of more moral products and a better customer experience.

5. Representation

Representation doesn’t require an economic justification; placing too excessive emphasis on the benefits of economic diversity, which is commonly used in business, can be extremely problematic since it tends to overlook the issue of inequality.

Many small-scale businesses struggle to create inclusive diversity within their ranks, limiting their ability to creativity, constant improvement, learning from cultural differences, critical self-assessment, and customer understanding. While the diversity of advisors is essential as a whole, it can also prevent homogeneity and ensure that leadership is accountable for the diversity targets and programs.

Make your business stand out by having an advisory board set up before you start to reap the benefits of how it can influence the company’s future vision, getting your business to the next level of business, not just quicker but also with greater precision as understanding and proficiency.