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Shop Floor INFORMATION FOR ACTION

accomplished can be another make or break point in creating and maintaining a high performing board. The facilitation process of the meetings and of the board members themselves is the most important component of that engagement.

BUILD A BOARD THAT WILL HELP YOU BUILD YOUR BUSINESS by JOEL STROM

TO SAY THAT TODAY’S persistently uncertain business environment is a challenge for manufacturers is definitely an understatement. Meeting those challenges and profitably growing their businesses requires that companies utilize every possible advantage and tool available to them. One such tool that too many companies have not considered is an advisory board. And for the companies that have formed an advisory board, many are not getting anywhere near the potential benefit they could. Advisory boards are NOT governance boards. If utilized as they should, their sole purpose is to provide strategic guidance and advice to management. Unlike most shareholder or governance boards, the purpose of an advisory board is to create significant returns on the investment made in the board and provide quantifiable strategic value to the company. There is a 4 step process to consider when creating a new advisory board or in restructuring an existing board that will ensure that your board will be highly functioning and that it will be producing great returns on your board investment. Design the Board Like anything you build, it all starts with the design. Designing a highly functioning board begins with a strong understanding and definition of what strategic objectives the board will be expected to help the company accomplish. Without this understanding, it is impossible to select

the right members for the board, to set expectations for the board, or to create metrics for board performance that will ensure strategic value. The outcome of the board design should be a board charter that sets and defines the board objectives, member requirements, and measures of board success. Build the Board Once the board charter has been completed and the member profiles have been developed, the board can be built. The process of finding and vetting the potential members of the board must be done as objectively as possible. Choices here can make or break the effectiveness of the board as well as its ultimate strategic value. If prospective members do not have the knowledge and experience as defined in the charter and are not the “right fit” for the company and its culture it will be nearly impossible for them to contribute in a meaningful way and to add value. Experience shows that there is no such thing as a bad board or a bad board member. There are simply t he wrong board members on the wrong boards for the wrong reasons. Friends, relatives, and other nice people may be fun to have dinner or play golf with but are not necessarily the right people for your board. Leverage the Board Once the board has been created, in order to help meet the stated strategic objectives of the company the members of the board need to become truly engaged. How this engagement is

Facilitation should include: • Sufficient preparation for each meeting including the creation of a solid meeting agenda. • Creating collaborative meetings that provide the board members with encouragement to participate by leveraging rather than managing the meeting. Going beyond simple yes/no answers from the members. • Bringing others from your team into the board meetings; not to report but to participate. • Reaching out to your board members for their insight outside of the board meetings. Evaluate the Board Assessing the ongoing effectiveness and strategic value of the board is a critical step in ensuring that the board continues to function as intended and that it continues to deliver strategic value. This evaluation helps the company determine when and if the board structure needs to be changed over time. Creating a great board and then maintaining its effectiveness over a long period of time requires attention and work. However done correctly it can provide a manufacturer with one more competitive edge; the power of 4 or 5 experienced executives dedicated to helping you succeed.

Joel Strom is a Growth Management consultant working out of Phoenix. He has been helping manufacturers thrive and grow for 30 years. To learn more about his consulting and advisory board practices visit www.Joelstrom.com or you can reach him at 602.276.3033 or by email at joel@joelstrom.com.

september/october 2011

arizonatooling.org

PrecisionNews

09

Precision News September October 2011  

Precision Magazine, the trade magazine from the Arizona Tooling and Machining Association. Featuring articles on manufacturing in Arizona, N...

Precision News September October 2011  

Precision Magazine, the trade magazine from the Arizona Tooling and Machining Association. Featuring articles on manufacturing in Arizona, N...

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