Cameron is a fellow EO member and was one of the leading forces behind ventures like 1-800-GOT-JUNK? which he helped grow from $2mm to $105mm, Ubarter.com and Barter Business Exchange. His companies are even studied by MBA programs including Harvard and Queens University in Canada. His expertise in building strong fast growing companies is unmatched.

I'm on a flight home from Warren Buffett's Berkshire Hathaway shareholders meeting in Omaha, Nebraska. I was speaking to a large group of entrepreneurs from the Entpreneurs' Organization. While there I was thinking about the difference between a Board of Directors and a Board of Advisors. What struck me was how entirely different their roles are.

During the past 10 years I've been both an internal and external member of the Board of Advisors for a couple of companies. In my prior role as the Chief Operating Officer of 1-800-GOT-JUNK?, I was an internal board member attending and helping to lead the meetings for close to seven years.

I thought I'd write down the key lessons I've learned along the way to creating a high performing Board Of Advisors.

It's starts with first and foremost understanding that the role of the advisory board is to advise and help hold the CEO and Leadership Team of a company accountable to build the company in the right way. One critical difference from a Board of Directors is that the board cannot fire the CEO and the board can be made up of any mix of internal & external members as the CEO wants - the board is there to help the CEO.

Vision

One critical piece in aligning the advisory board with each other and the company as a whole is a document outlining the vision or Painted Picture of the company a few years out. In a couple of pages the clearer the CEO can describe what he wants the company to look like the better advice the board will give him. See my website BackPocketCOO.com for a sample Painted Picture.

People

What comes next is what Jim Collins outlined as getting the right people on the bus and the wrong people off the bus. There is no need to put lawyers and accountants on the board a) you can easily pay for their advice and b) often their advice due to their profession has to be more risk adverse than a company needs to help them grow. You want to stack your board with people who are not only an expert in a niche such as marketing, but who also have helped build companies in the past at a leadership team level. You want people who live in or VERY close to your city so scheduling meetings is easier. And lastly you ideally want a 3-5 year commitment from them as you'll learn more and more from them as they get deeper and deeper into the psyche of the company.

Preparation

In 1994 I did a speaking event called "The 6 P's" which stood for Proper Preparation Prevents Piss Poor Performance. And my rule holds up equally true today as it did then. It is the role of the CEO and their team to ensure the board receives a package of materials to read and bring them up to speed well in advance of the meeting. Ideally the report should be brief, and contain updates on:

"¢ The companies successes since the last meeting
"¢ The areas in which the company is struggling
"¢ Any key relevant metrics
"¢ Financial statements showing key ratios & performance versus budget & versus prior quarter & year
"¢ It should also outline any key decisions the company may be facing in the coming quarter & year
"¢ Lastly, every report should include the Painted Picture as an ongoing reminder of what is being built.

All members should be reviewing the material well in advance so they can come with questions and insights.

Meeting Rhythm

Meetings with the advisory board should be held 4-6 times a year and each one should be roughly 3-4 hours in length. The meetings cover questions on the Prep Packages sent out in advance but should not be a dialogue where the material is then just re-read. After roughly 1 hour the meeting should shift into creative discussion, insight gathering and debate around 2-3 critical areas the company is working on. If the meeting is well run it should be less like a presentation and more like a group of team members sharing experiences and challenging each other's ideas to gain the best possible insights and consensus. Lastly, each member should be adding to all topics and not just giving advice from their area of specialty.

Accountability

The highest performing boards are ones where the company does what they say they will do in between meetings and where during meetings, all fears, ideas, frustrations and restrainers are disclosed to the board and not just the good news.

In addition to a Board of Advisors I've also always found the highest performing leaders and companies are the ones who reach out to many other outside experts for advice also. As humans we're hard wired to help each other. When people reach out to us for advice it makes us feel good. I'm not old enough or "˜bored' enough to be on traditional boards but advisory boards are awesome and another great way I help Entrepreneurs Dreams Happen. Try one for your company too. You'll wonder how you survived without one before.

Cameron Herold | Founder