Whether you run a small, one man show, or a medium sized partnership, your business consulting firm will need some input from other parties, if only to maintain objectivity. Here, we look at the various options for establishing your board, from the conventional, to the contemporary.
Board of Directors
This is the traditional, old-fashioned board of directors that help run your company. In some cases, for certain types of companies, a board of directors is legally required, however, even if that is not the case, you may still want to appoint a formal board, if that is what you feel comfortable with.
A board can consist of a mix of internal and external members, although traditionally, they should all be experts in the field. Since an aspect of independence and objectivity is desired, it may be desirable to use external board members, or a higher proportion of these, in order to gain unbiased insight.
The boards’ primary role is to help make decisions regarding your consulting firm’s future, and they have a fiscal responsibility to maintain the company’s financial management, and sometimes, to ensure that this occurs, they are afforded shares in the company to increase their level of commitment.
Bear in mind however, that with the responsibility of serving on a board, comes a level of liability, which may deter some board members from serving, unless, of course, you have some form of liability cover in place!
Board of Avisors
A board of advisors is a less intense form of a board! While the members are still experts, and their task is still, to some degree, to assist in running the company, they do not become involved in financial matters, and there are less legal issues relating to the setting up of this board.
If you choose to set up a board of advisors, make sure that you choose respected industry veterans, who will add impact and strategy to your business. Make sure, in other words, that they are well known, and that by associating with them, you will gain prestige.
This is an excellent networking tool, as your advisors will, by their nature, be people of substance, who should be able to open doors, and make introductions for you. Be warned however that since their decision-making abilities are limited if not non-existent, they may not take the position as seriously as you would hope!
Board of Experts
The least formal approach, this type of board is made up of a variety of informal advisors and experts in various aspects of your consulting business, from financial to marketing and legal.
Consider it a collection of mentors, whose task (although they may not even know it!) is to serve as a sounding board and objective advisory panel for you.
While the approach is informal, the selection is entirely up to you, and by choosing the advice of trusted friends, consulting associates and other parties, you build a board with a vested interest in the success of your business.
There are no legal ramifications here, nor, usually, any cost. However, since they may not be aware that you are taking their advice so seriously, they may not put as much thought into it as the usually would, and you will need to weigh any advice provided carefully before actioning it!
The choice you make for your board will ultimately depend on the amount of control you are willing to give up (unless of course the business form you choose requires a formal board.) Therefore, weigh your options, and make a choice. Remember, it is not written in stone, and you can change your mind at a later stage!