Situation: A CEO wants to build network of highly placed contacts. One method that she is considering is joining a not-for-profit Board. What are good organizations? Is it reasonable to expect a quid pro quo? How do you join a not-for-profit Board?
Advice from the CEOs:
Do your homework. Find out what the most influential Boards are in your community. For example, the Silicon Valley Chamber of Commerce is very active and includes in its membership many very well connected people.
Influential groups and boards will vary by community. In Silicon Valley, the Silicon Valley Association of Start-up Entrepreneurs (SVASE) is a good organization to consider. This and other Angel groups know small companies that need help. Others include the Sand Hill Angels and the Asian-American Multi-Technology Association. In other communities Chambers of Commerce or similar organizations are the movers and shakers.
Don’t count out Rotary, Lions, and similar organizations. All these organizations are struggling to recruit new members and some have movers and shakers.
Rather than thinking about the meetings, volunteer to join a committee. For example, volunteer to join the Finance Committee. Once the members get to know you, you may be invited to join the Board.
Raise money for an organization, this will bring invitations to join the Boards of other organizations.
Follow your passions in selecting an organization, you will be more enthusiastic.
It is reasonable to expect a quid pro quo? Yes, if you make a significant contribution and demonstrate your competence.
Situation: A private company has a Board of Directors that functions more as an Advisory Board than a traditional Board. For example, they do not have the power to fire or replace the CEO. The CEO wants feedback on how to interact with the Board, and how to work with them between meetings. How do you make the best use of your Board?
Advice from the CEOs:
Decide what you want from the Board, and clearly communicate this to the Members.
Treat the Board as a single entity – not as individuals. Avoid politicking individual members between meetings. Use the Board to drive decisions.
At your next Board meeting have a discussion with the Board:
Let the members know that you are concerned about whether you are using them effectively as a resource.
Lay out strategic elements to be dealt with over next period, and ask for their advice.
For example, if you are moving into a new market you need advice on how to succeed. Are they the right group to provide this advice? If not, what other expertise should be added to the Board?
Consider having this conversation in a special session of the Board.
Bring in expertise – if your industry has shifted, adjust the make-up of the Board to reflect the new realities. If you need to raise capital, look for expertise in this area.
Eliminate less productive members from the Board.
If you are looking at a new market, build an Advisory Board that is knowledgeable about this space, but who are not necessarily customers. Consider retired executives from companies in this market.
Additional needs that you might want to address either through your Board or an Advisory Board:
Financial expertise in new markets.
Where should you partner to make a complete offering or to supplement your offering?
Another CEO has a similar Board situation. In this case, the CEO makes it clear that Board members are expected to:
Assist in bringing in business.
Members are expected either to produce or they are off the Board.
Meetings are driven to a specific agenda with expectations of deliverables.
Situation: A rapidly growing company is expanding both in its primary market and into new verticals. A number of companies are interested in strategic partnerships. How do you select the right partner in the right space?
At the end of the day it’s about a connection with the partner which extends across both organizations.
Look for cultural synergy with the other company. Do your and their managers and employees “click” or are they oil and water? This is a gut assessment.
Is the quality of people in both companies complimentary? Is there similar drive for quality and attention to detail?
Will technical integration be smooth? Are systems complimentary? At a minimum are there the right skills on both sides so that this won’t hinder the project.
Are sales and marketing approaches compatible? Will teams be able to work together? What about other departments?
You need to have strategic commitment across both organizations.
Partnerships don’t work if there is only alignment at the top. Executives can’t shove a new opportunity down the throats of those who report to them. There must be excitement about the opportunity across both sides of the partnership.
There must be complimentary competencies, capabilities and commitment.
Is there a clear understanding of the goals and objectives succeed?
Reward structures and incentives must be aligned down through the two parties. Conflicts will lead to struggles.
There must be a strategic alignment between the two organizations so that both see the partnership as complementing their broader strategic plans.
There must be a fundamental strategic win-win. The venture must be seen by each party as core to their business, plans and results. If this isn’t present, the collaboration can be drowned when a better opportunity that comes along.
Look for some gauge that the partnership is as important to the other party as it is to you. What other partners do they have? Is the size of the opportunity enough so that you are assured of their ongoing attention?