Learn about what an advisory board does and how it assists organizations throughout the decision-making process.
Much like an athlete would hire a trainer to improve their game, a board of directors looks to an advisory board for coaching. No matter how engaged and talented the board members are, they’re still busy people with unique strengths and weaknesses. An advisory board helps with effective board management. Read on to learn more about an advisory board’s roles and responsibilities.
What is an Advisory Board?
An advisory board is a group of experts who lend their skills, guidance, and knowledge to an organization (corporation, nonprofit, or association). In short, an advisory board serves the purpose of its name—to offer advice that helps an organization grow and achieve its goals.
The primary function of an advisory board is to fill a knowledge gap in the organization. According to advisory board research conducted by the Business Development Bank of Canada, 86% of entrepreneurs with an advisory board say it’s had a significant impact on their business.
An advisory board’s essential operation is to be the impartial third party that can be anything from a sounding board to a watchdog for the organization. Advisory boards can provide project insight for specifics like technology choices, or they might shed light on your market conditions and buyer personas to help you tailor your product or message to your audience. They can even share their expert knowledge about professional realms outside of your own, like government and regulatory matters.
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Advisory Board vs. Board of Directors
Almost every organization has a board of directors, but not every organization has an advisory board. To understand the difference between an advisory board vs. board of directors, let’s first identify their commonalities.
Both boards serve one general purpose: steering the organization to success. On top of that, both boards represent the organization in public matters and provide helpful perspectives and solid ideas.
The primary differences between an advisory board and a board of directors comes down to the legal responsibilities of each board. An advisory board has no governance responsibilities. That means members have no voting rights and cannot make financial decisions on the organization’s behalf.
Typically, an advisory board focuses on specific areas of an organization’s needs like:
- Promoting the organization in the community
- Expanding an organization’s network through event planning
- Guiding the organization’s board leadership in specific subject matters
- Connecting an organization to a new audience
On the other hand, the primary responsibility of a board of directors is governance. This includes having voting rights, fiduciary duties, fundraising, and asset management. As the name suggests, a board of directors offers directional guidance to help an organization achieve its goals. A board of directors focuses on:
- Creating strategies for the organization—from staffing plans to assessments
- Setting the organization’s policies
- Making financial decisions
A perfect blend of an advisory board and a board of directors lifts an organization to new heights.
Advisory Board Responsibilities
While every advisory board may have specific roles in an organization, here are the common responsibilities of all advisory boards.
1. Support the Organization’s Goals and Objectives
Advisory boards provide wise counsel regarding myriad issues that your organization may be facing. An advisory board’s essential operation is to support the organization’s goals. The advisory board provides insight, but it’s up to the organization and board of directors to decide whether or not to act upon it.
2. Provide Oversight, Guidance, and Expertise
Advisory boards provide the latest techniques, knowledge, hacks, and trending industry information. There are several kinds of advisory boards. Yours might be a crossover among several types, but having a well-defined category can be a north star for your team of experts. Types of advisory boards include:
- Strategic
- Product/solution
- Customer/audience
Many types of organizations can use an advisory board, especially in their early stages or during periods of transition. Advisory board members don’t always have years of experience in your exact field. Instead, they can often have skill sets that you need at the moment.
An advisory board should help the organization stay on top of industry trends. This could mean beating the competition, streamlining their customer service based on new purchasing behaviors, or tailoring their products and message to reach a wider audience.
3. Serve as a Mentor
An advisory board provides strategic advice and expertise organizations need to reach their goals. In all situations, advisory board members are experienced and trusted advisors. As you work with the board of directors, you use your skills to guide the leadership in the right direction. As a result, you serve as a mentor.
How to Host an Effective Advisory Board Meeting
Similar to a board of directors, an advisory board holds meetings. These meetings should be engaging and effective to provide maximum value to the organization. To host an effective advisory board meeting, follow the steps below:
- Establish an appropriate date, time, and location, and share them to board members in advance.
- Create a detailed agenda, and send the agenda to board members at least a week prior to the meeting.
- Ensure every member has access to all crucial meeting documents needed to thoroughly discuss agenda items.
Board management technology helps board leaders prepare and run effective meetings with features like:
- Drag-and-drop agenda builder that allows you to build from scratch or start with a template.
- Secure document storage so all members can access minutes, agendas, meeting notes, and other board documents no matter their location.
- Meeting briefs to alert attendees when they’re invited to a meeting, coaching them on next steps and how to better prepare for their meeting.
Power Your Advisory Board With OnBoard
Advisory boards guide organizations to their success. It’s vitally important to understand your responsibilities to deliver total value as an advisory board member. When hosting advisory board meetings, ensure they’re effective by using a powerful board technology platform like OnBoard.
Ready to supercharge your advisory board? Get started with a free trial of OnBoard.
Ensure effective, efficient meetings with our comprehensive Board Meeting Agenda Template.
About The Author
- Adam Wire is a Content Marketing Manager at OnBoard who joined the company in 2021. A Ball State University graduate, Adam worked in various content marketing roles at Angi, USA Football, and Adult & Child Health following a 12-year career in newspapers. His favorite part of the job is problem-solving and helping teammates achieve their goals. He lives in Indianapolis with his wife and two dogs. He’s an avid sports fan and foodie who also enjoys lawn and yard work and running.
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