Why Advisory Boards Fail Due to a Lack of Clear Purpose and Goals
I’ve sat on for-profit and non-profit advisory boards over the years. Some ran like clockwork, while others did not. Typically, the ones not running correctly have one thing in common – they are failing. I’ve deduced that one of the reasons for failure is if the advisory board lacks a clear understanding of its purpose and goals, it may be challenging to provide practical advice to the organization.
Here are a few examples of how advisory boards may lack clear purpose and goals:
- Lack of alignment: If the advisory board members have different opinions on the board’s purpose and goals, it may lead to confusion and ineffective advice.
Right after the financial crisis in 2008, a non-profit organization’s president called an advisory board meeting to discuss a strategy to liberate the organization from being dependent on the sponsorship of large banks. These corporations pulled back support because they were also in flux.
The advisory board’s disagreement split the vote 50/50. Fifty percent wanted to increase fundraising measures from individuals and increase membership dues. The other fifty percent who disagreed advised that the president implement cost-cutting measures immediately. A battle began and sucked up valuable time.
To resolve the issue, we decided to go back to basics and reviewed the organization’s mission statement, purpose, and goals. Once the board was aligned, advising the president to close the office and operate virtually was so simple. We eliminated significant expenses – rent and a full-time person to manage it. It was the best decision they made…and it was unanimous.
- Undefined scope: If the advisory board’s scope is unclear, its members may not understand the issues they are expected to advise.
In the above scenario, the fundraising committee thought the organization needed to raise more money because that was their responsibility. However, when we reviewed expenses, the corporate sponsorship monies went to rent and HR. If we removed the two highest costs, the organization would be profitable on the members’ dues. The board understood that some members were operating on a narrow financial scope. Once they expanded their scope to keep the organization afloat, they could make a broader decision.
- Inadequate communication: If the organization does not communicate the advisory board’s purpose and goals clearly to its members, they may not understand what they are meant to do.
An assumption is made that when a new member is onboarded, he/she will get orientation as to what the organization does and its purpose and goals. Most businesses or organizations do not give formal orientation information or hold a class. Board members join a board because they want to fill a specific need; that doesn’t mean their needs align with the company’s goals. Leaders, you must give the advisory board clear guidance on what you want from them. If you provide them with an agenda before the meeting, they will know the decisions you want them to help you make.
- Lack of focus: If the advisory board members focus on too many topics, providing meaningful advice on any of them may be difficult.
I like to have one topic or decision per meeting; however, if it’s urgent or related to the main topic, I will not have more than two topics per meeting. That’s because I will need their advice at the end of the session, and it’s easier with one topic. I want my board to focus on giving their energy to my subject so they come to the table with ideas and names that can help me resolve my problem, and phone numbers I can call about my issue.
Again, send members what you need to discuss beforehand so they can research or find the information in their contact lists.
- Unclear decision-making process: If the advisory board members are unclear about how their advice will be used to make decisions, they may not be motivated to provide thoughtful guidance.
When you make an “ask” of the advisory board, don’t just give them the information they need to make a decision; give them the outcomes you expect after implementing the decision. It’s much easier for someone to advise with a clear result. It’s also easier for them to hold you accountable in future meetings.
If an owner takes the time to form an advisory board and set aside one or two hours per month or quarter for meetings, the last thing wanted is to walk away from a meeting with confused board members. When neither the owner nor the board is productive, the owner disbands the board because they hinder advancing business needs. If that happens, remember it’s not the board; it’s the owner or executive! These easy tips will help you have a board that delivers clear decisions with the desired outcomes.