How Advisory Boards Drive Success for Technology Companies
The Importance of Direction
Every company has a direction—either upward or downward. If a company’s trajectory is heading downward, it’s crucial to evaluate how long this trend can persist and what steps can be taken to reverse it. Conversely, if the direction is upward, it’s worth considering how long the growth can be sustained and what preparations are necessary to ensure the positive trend continues. In both scenarios, external support can be utilized to either change or maintain the company’s direction. This type of support is often provided by an Advisory Board.
What Is an Advisory Board? Key Differences and Benefits
An Advisory Board differs from a company’s board of directors in several key ways. It is typically established to address a specific need, such as reversing a downward trend, and operates intensively for a fixed period—often two years. In contrast, the board of directors is a permanent, legal entity with defined responsibilities. However, the Advisory Board and the board of directors can work collaboratively. For instance, the Advisory Board’s findings and recommendations may be presented to the board of directors for decision-making, which then incorporates them into the company’s operations.
Leveraging an Advisory Board for Growth
How can a growing technology company offering consulting services utilize an Advisory Board for operations and development? Success begins with a clear objective. If an Advisory Board is created simply for the sake of having one, it risks becoming little more than a social coffee club with minimal impact. The goal—whether it’s driving growth, exploring new business areas, pursuing international expansion, or something else—determines the Advisory Board’s purpose and the expertise required. Including professionals from entirely different industries can also bring fresh perspectives and enhance diversity.
Enhancing Expertise Through an Advisory Board
An Advisory Board can be a valuable resource for enhancing operational activities and broadening the leadership team. Through this platform, companies can access expertise in areas such as communications and marketing, business development, or financial management—skills that may not be necessary or practical to hire on a full-time basis.
Ensuring Diverse Perspectives and Strong Facilitation
To maximize its value, the Advisory Board should consist of members who are not already familiar with one another, ensuring a variety of perspectives. Effective facilitation, leadership, and communication are critical to fostering an environment where everyone feels heard. An Advisory Board should provide a safe space for sharing ideas and ensure that members understand the goals, the progress being made, and what aspects of the board’s work can or should be communicated externally.
Addressing Challenges in an Uncertain World
Recent years have brought massive instability, and the future appears increasingly uncertain, with changes occurring at an ever-accelerating pace. This has impacted all areas of business, emphasizing the need for better forecasting and scenario planning. The technology industry, often at the forefront of these efforts, faces unique challenges in the current economic downturn, which has hit consulting firms particularly hard. Many companies will likely seek to expand their expertise and capabilities to regain an upward trajectory—potentially by leveraging tools such as an Advisory Board.
The author is NorthCode’s CSO, Hanna Saari, who is also a Certified Advisory Board Member.