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Key to company's success lies in good advice
By
IANS
Sydney: Boards of directors have a significant role in managing and creating value for emerging high performing, high growth firms, according to a study.
More than half of the participants surveyed indicated that their boards provide a "very high" or "high" influence on creating firm value through compliance, industry contacts and strategic advice.
The report, released in September by Deloitte and Grow Wellington's business incubator, Creative HQ, was based on interviews and case studies with more than 300 Deloitte/Unlimited Fast 50 companies to identify common factors in success and specific growth strategies.
Mark Ahn, professor of entrepreneurship at the Victoria University (Wellington, New Zealand), who conducted the study, said much of the attention of boards and directors was on compliance and regulation, but the true value was derived from completing this with contacts and content.
Research results showed that 73 percent of companies had either advisory boards or boards of directors, though only a small number were required to have boards in place.
Ninety-eight percent cited strategic planning as "important" or very "important" roles for board members, and strategy development was ranked twice as important as any other board level activity, said a Victoria University release.
"Supplier, customer and investor networks, together with the experienced and tacit strategic knowledge on advisory boards are all crucial in creating sustainable high performing, high growth companies," it said.
More than half of the participants surveyed indicated that their boards provide a "very high" or "high" influence on creating firm value through compliance, industry contacts and strategic advice.
The report, released in September by Deloitte and Grow Wellington's business incubator, Creative HQ, was based on interviews and case studies with more than 300 Deloitte/Unlimited Fast 50 companies to identify common factors in success and specific growth strategies.
Mark Ahn, professor of entrepreneurship at the Victoria University (Wellington, New Zealand), who conducted the study, said much of the attention of boards and directors was on compliance and regulation, but the true value was derived from completing this with contacts and content.
Research results showed that 73 percent of companies had either advisory boards or boards of directors, though only a small number were required to have boards in place.
Ninety-eight percent cited strategic planning as "important" or very "important" roles for board members, and strategy development was ranked twice as important as any other board level activity, said a Victoria University release.
"Supplier, customer and investor networks, together with the experienced and tacit strategic knowledge on advisory boards are all crucial in creating sustainable high performing, high growth companies," it said.
Reader's comments(3)
1
It is absoluely true! However, companies in India specially the smaller and
start-up technology companies (IT services, outsourcing) do not believe in this.
Most of these companies are started by techies who are great in doing technical
work, but fail to realize that the "business of doing the technical work" is
different from the "technical work that is done in the business".
Advisors are "coaches" who are equally responsible for the success of the
venture, much like the coaches of professional sports (football, basketball,
tennis etc.). Nick Bollettieri is a great example of the legendary tennis coach,
who began his coaching career inspite of not knowing anything about tennis, and
produced stalwarts like Andre Agassi, Boris Becker, Monica Seles et al.
Another example of a successful advisor can be taken from the great
"Mahabharata". Without Krishna, the Pandavas would have lost the battle. Krishna
was not doing the actual "fighting" (the tactical work)...it was the
responsibility of the Pandavas (the executive management team in a venture).
However, Krishna was coaching and advising the pandavas...he was playing an
advisory role.
A coach / advisor brings the "eagle's perspective" which is very much required
in any venture as the "executive management" is usually very focussed...they are
the frog in the well and cannot see what lies above / outside the well.
Sadly, most of the ventures have no idea regarding their raison d'être. They
start because they have been great techies in their earlier avatars as an
employee of a big company and think that that is enough to build a great
company. The importance of strategy is completely ignored.
start-up technology companies (IT services, outsourcing) do not believe in this.
Most of these companies are started by techies who are great in doing technical
work, but fail to realize that the "business of doing the technical work" is
different from the "technical work that is done in the business".
Advisors are "coaches" who are equally responsible for the success of the
venture, much like the coaches of professional sports (football, basketball,
tennis etc.). Nick Bollettieri is a great example of the legendary tennis coach,
who began his coaching career inspite of not knowing anything about tennis, and
produced stalwarts like Andre Agassi, Boris Becker, Monica Seles et al.
Another example of a successful advisor can be taken from the great
"Mahabharata". Without Krishna, the Pandavas would have lost the battle. Krishna
was not doing the actual "fighting" (the tactical work)...it was the
responsibility of the Pandavas (the executive management team in a venture).
However, Krishna was coaching and advising the pandavas...he was playing an
advisory role.
A coach / advisor brings the "eagle's perspective" which is very much required
in any venture as the "executive management" is usually very focussed...they are
the frog in the well and cannot see what lies above / outside the well.
Sadly, most of the ventures have no idea regarding their raison d'être. They
start because they have been great techies in their earlier avatars as an
employee of a big company and think that that is enough to build a great
company. The importance of strategy is completely ignored.
Posted by:
Giri
2
this is a truth.. but advice is not the correct thing.. coz advice can be
showered upon anyone...as its said "an example is better than advice".
showered upon anyone...as its said "an example is better than advice".
Posted by:
gauri
3
Ofcourse it plays a key role and it is these people's decision help in the
success of the company.
success of the company.
Posted by:
Suresh
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