Whether you are a one person operation or have few thousands workers, having someone in an advisory role can pay huge dividends by offering objective analysis and getting a few doors opened. An advisory board is different from a board of directors in terms of legal requirements, an advisory board serves more of a mentorship role. Its members have no fiduciary responsibility to the company or its stakeholders.
Young, growing companies can benefit most from advisory boards by getting an independent view of their operation, with questions that provides a better perspective that goes beyond profitability. And with business regulations growing more complex due to increasing consumer protection laws, start-up enterprises can reduce their trading enviromental risks by bringing on board an experienced advisor or mentor.
Small enterprise owners must look for the peolple they trust when creating their advisory board, starting with their lawyers and bankers and some respected members of their local industry assocition. A riskier option could include customers and vendors who might have good connections in the industry. Just be careful about who get to know your company's trade secrets or have them sign confidentiality agreements.
The greatest asset an adviser lends to a small enterprise is credibility with both internal stakeholders such as employees and external stakeholders such as investors, suppliers and customers. Smart advisers are good, but you also want a spread of perspectives and skills that complement your own.You might get an expert on sales and marketing, while another might keep you honest about your financial projections or the importance of ethical business practises.
Orginisations such as umsombomvu youth fund offers free mentorship programs to young enterpreneurs. The mentors act as an advisors to the young enterprise for no pay.
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