Business leaders are backing a global trend and introducing independent advisory boards to help shape their future.…
The Role of Advisory Boards in Building Business Confidence
In the last 15 years of research, nothing has excited me quite as much as the shift we have seen in the Advisory market over the past 2 years. There were several fundamental developments revealed in the 2021 State of the Market Report in both corporates and the business sector. The Business Confidence Index, however, is the one that has captured my imagination the most.
I’ll just take a step back. A businesses growth and investment cycle is often defined by a “make-or-break point” and can be closely aligned with Advisory Board activity. The most common revenue point for implementing an Advisory Board is revenue between $1m to $1.5 million. Other make or breakpoints when Advisory Boards are activated (or reshaped) are at $10 million, $30 million, $50 million and $100 million.
Our observation is when a make-or-break point is reached, it activates new decision-making cycles of what’s next and is a clear indicator of an owner’s confidence in their business.
Our observation is when a make-or-break point is reached, it activates new decision-making cycles of what’s next and is a clear indicator of an owner’s confidence in their business. We found 90% of businesses see a 30% improvement in business confidence since implementing their Advisory Board.
So what does 30% improvement in confidence mean? For most Owners, the businesses’ ability to operate without them is a primary need. For others, it could indicate better return and satisfaction with their business overall.
Drivers of confidence will continue to be studied with many internal and external factors to consider. Internal drivers could include confidence in sales, cash flow, management teams, the ability of employees, resourcing and systems. Confidence in external market conditions could include certainty, clients, supply chain, political and social environments as examples.
I am looking forward to diving deeper into the Business Confidence Index, discovering the indicators that make a difference in people’s lives and their ability to make stronger and more deliberate decisions. If we can truly understand confidence for Owners, a 30% improvement could mean a world of difference. As a founder and CEO myself, I view this as 30% more sleep at night. Now that’s worth studying!