When should a family seek help from outside the family through independent advisors or an advisory board?
Family businesses can become insular. Business managers naturally focus inward and, if not accountable to other owners, can become oblivious to larger issues. Results can include strategy made stale by changes in the marketplace, failure to invest in operational enhancements, or failure to groom key personnel. Sooner or later, these weaknesses become apparent and solutions are hard to find internally. Rather than succumb to these weaknesses, conscientious family business owners reach out to a competent advisory board or statutory board of directors to augment, challenge, and monitor management. The board raises the family business’s gaze above the horizon, often for the first time and often long overdue. Advisors, individually or as a group, have no legal authority over a business. Whereas corporate boards direct, advisory boards only advise, lending their expertise, objectivity, and networks of contacts to complement the talents of management. Advisory boards are often convened to dea
