Small-to medium-sized businesses can now access C-suite expert advice
Owners or executives for small- and medium-sized businesses who have a lot on their management plates often make decisions based on a gut feeling or past experience.
C-suite personnel with big companies, meanwhile, can solicit advice and guidance from board members before deciding to stay the course or implement changes.
Mark Perlo believes small business owners should have that same luxury in their management arsenal; that’s why he created The Advisory Board LLC, a group of former CEOs and business executives who, over the course of the year, will provide a variety of services from strategic insight to risk mitigation.
As a former small business owner himself, personal experience tells him that people running a company are often so immersed in day-to-day operations they don’t have adequate time to devote to the big picture.
Bringing The Advisory Board on board means that small- and medium-sized businesses can access the expertise necessary to grow.
“We talk about where their company is and where they want to take it,” Perlo said. “If they say, ‘We’re a three-person company and we don’t feel like growing, we’re stable where we are,’ we’re not for them.
“We’re talking about companies that want to grow, that need to change direction or are looking for an exit strategy. Now, that exit strategy might not be today, it might be five or 10 years from now, but how do we set ourselves up for that. We’ve all gone through that.”
The Advisory Board currently has four consultants: Perlo, one of the first franchisees of a Xerox dealership; Julie Klie, a former vice president of an international software company; Ed Smaldone, who has a background in finance and administration; and entrepreneur Bob Leone.
“Basically, it’s a group of experienced people that have bought and sold businesses, run them, hired, had to let people go, had to change strategy when business conditions changed,” Perlo said.
Small business owners often believe an advisory board isn’t for them, that their operation isn’t big enough to fill the need.
“A: they don’t think of it,” Perlo said, “they think it’s for a bigger company; B: if they think of it, they don’t know how to get there or it will cost a fortune; or C: they think ‘I might have to give the advisors stock or equity in my company to be on the board.’ That gives them a fear factor.”
There’s also a natural apprehension to share company details with outsiders.
“We all have those same experiences; we didn’t want to share either,” Perlo said. “But once we learned that, by sharing with the right people, we could expand our business and grow maybe into different areas, where the market is telling us to go but we’re a little afraid to pull the trigger.”
The typical client for The Advisory Board would be in B2B sector or a specialty services company with between $3 million and up to $20 million in annual revenue. Retail businesses are quite likely not the right fit.
“After $20 million, they’re probably getting a full-fledged board — people they’re giving stock to,” Perlo said.
A company would receive the services of two or three members of The Advisory Board team. After an initial consultation, there would be quarterly meetings as well as monthly check-ins.
“I’m the kind of person — and most CEOs are too — (who wants) to be accountable but who are you accountable to when you’re the boss?” Perlo said. “So, these quarterly meetings make you prepare, to show these advisors, ‘This is what we said we were going to do, here’s what I did and here’s where I had trouble.’ That really, really is helpful.”
Especially when the business owner or executive embraces what the advisors can provide.
“If you have confidence in yourself as a CEO, then you’re willing to share the lumps and bumps you took during the quarter and the challenges you feel coming up,” Perlo said. “This isn’t a pass or fail, it’s guidance.”
The Advisory Board officially launched on Jan. 1. The long-range goal is to expand across the country, since there are plenty of former CEOs with a desire to help.
“There’s this whole glut now of retired business executives that are looking for something to do,” Perlo said. “Most of them try to call themselves consultants or try to find some pathway, and we think there could be a whole bunch of advisory boards across the United States, of people putting a similar structure together.”