Advisory Boards Inject New Ideas, Raise Expectations
As seen in the May, 2010 edition of HVACR Business Magazine
As the owner or general manager of a company your team includes the leaders (managers) of the various divisions or departments. Hopefully, you are having structured team group meetings on a regular frequency. In August, 2007 HVACR Business published an article of mine where I recommended that you also consider certain outsiders as team members. The outside team members do not participate in the leaders’ group meetings and the recommended members included your CPA, attorney, insurance agent, banker or bankers, advertising agent, and consultant/coach if you use one. They are people you have carefully chosen and that you can rely on to help your company achieve the desired results. The article included advice on how you make a selection of the outside team members. I now suggest that you add your prime supplier and your website development/Internet/social networking resource person.
Many HVAC contractors belong to an information sharing group of normally six to twelve contractors representing contracting companies from different areas of the country. These groups generally meet two to four times a year and usually at one of the member’s facilities. I’m a proponent of these groups and believe they are a good source of information.
There is another great outside team resource that I recommend you strongly consider and it probably is right there in your community – an Advisory Board. Believe me, if anyone knows how entrepreneurs think it is me. Often, we believe we have all of the answers and can do everything. But, that’s not true. And, when we get around to looking for advice and information we tend to look for it in our own industry, from other contractor companies, alliances, associations and information sharing groups. That’s all great and I certainly support such behavior. But, there are two things missing. One, the advice is coming from only those within our industry; and, two, are we really willing to accept advice that ruthlessly assesses our skills (or lack thereof).
In my first HVAC company which grew from a one man operation to a huge and quite successful retail and contracting organization we studied and learned from other retailers, not HVAC companies. That’s exactly how we got far out in front of most other companies in our industry. Marketing is a good example. Adopting the marketing and advertising techniques and principles used by companies selling appliances, televisions, sound systems, clothing, vacations and homes, etc propelled our company to new heights. Staffing is another example. We did not confine ourselves only to people within our industry. In fact, we deliberately recruited, hired and trained people outside of our industry. Many of those are now recognizable leaders in the HVAC community.
The point I’m making is you are only going to learn a certain amount from your own industry. How would you ever get any better than the best contractor? Assuming you select the correct members an Advisory Board is the answer. Do not place your other outside team members mentioned in the first paragraph of this article on this Board. You are already getting their advice and paying for it. Select members that are or have been successful in other professions and industries. They will often bring advice and information that you have never previously considered and they will ask questions that will cause you to think “why do we do it that way?”
Look for members that can contribute in areas such as human resources, marketing, new creative ideas, strategic planning, dispute resolution, finance, business evaluations and management techniques. Six members plus yourself is the right size for a Board. Pay them an honorarium of $500 to $1000 per meeting and meet quarterly. Be structured, work from meeting agendas and provide them with plenty of information on your company. Why would successful people such as I’m suggesting spend the time to be on your Board? It’s because you are able to make a convincing presentation that you are sincere in looking to them for advice, that they can get a sense of satisfaction in seeing your company improve and prosper and that they can meet and learn from the other Board members.
You’ll know when you have the right Board – they’ll be candid, will hold you accountable and will challenge you.