With every growing business, there comes a point when you realize that you and your management team are lacking some of the skills and expertise needed to rev the growth engine to the next mark on the dial. Building a diverse board comprised of smart people with the knowledge and experience your business needs may be the next step. An effective board can help with strategic planning, financial auditing, and executive hiring. It can also provide the corporate oversight necessary to attract outside investors.
If you’ve reached a stage in your company’s growth where you need guidance or input on general business areas like financial auditing, strategic planning, raising capital, and management decisions, consider getting some assistance. A board with diverse expertise can be an invaluable, independent resource, and an asset for attracting prospective investors.
Your board’s responsibilities and powers are spelled out in the board’s bylaws. These responsibilities include hiring and firing of key executives, determining executive compensation, reviewing and approving annual budgets, and approving strategic decisions. A board’s guidance and decisions can be binding or simply advisory.
Boards generally have between seven and 15 members. The most effective boards aim for diversity, including age, gender, race, and professional experience. Directors should be familiar with your industry and skilled in key areas that are most needed by your business. Most of the independent members should not simply mirror your thinking, but rather bring new and innovative perspectives to the table.