7 Tips to Consider while Nominating & Electing Board Members

In my previous blog “Significance and Functions of a Board of Members” I discussed the importance of having board members in an enterprise.  

Here are some suggestions to consider while you look for board members for your company:

Prefer Quality over Quantity

Ability and skills always score over numbers at the board level. Prefer experience and expertise when it comes to choosing board members.

For privately-held start-up enterprises, the number of nominated candidates should range between 3 and 7. Entrepreneurs can reserve one or two seats for investors if they are looking to raise equity from venture capital funds or from private investors.

Seek balanced board experience

Make sure you have a perfect blend of multiple talents and skills when it comes to picking directors for your company. You should prefer individuals with a wide range of specializations – finance, product development, sales, business continuity and employee engagement marketing etc.

It is always advantageous to have board members who have served in one or more for-profit boards.

Hire legal help as needed

It is helpful to have corporate lawyers on board who can attend board meetings as acting secretaries or non-voting corporate counsel.

Get aligned

Make sure all the nominated candidates are aware of company’s business goals, financing objectives, product development priorities and distribution strategies. A candid discussion can help ensure that all nominated members are on the same page and do not have any issues pertaining to the policies of the enterprise.

Use ‘em or lose ‘em.

It’s the founding entrepreneur who can utilize each board member’s skills and specialization to the maximum effect. When great business brains join a board, they need freedom of thought and action to put their knowledge to maximum use.

Let them explore their productive ideas for the growth of company albeit things should never go beyond your own vision and control.

New businesses need experienced advisers

 It is a mandate for new business and small businesses to have astute business advisers as their board members. Their experience and sharp business acumen will play a vital role in improving company’s operating direction.

Corporate Executive Coaching

Corporate Executive Coaching at a CEO club helps you identify your needs when form a Board of Members. As you get to meet different experienced and knowledgeable leaders at CEO associations, you can get insight into basics of nominating and electing eligible board members.  Join a reputed CEO peer group especially if you are starting-up a new business and need practical tips on how to build a performing, useful Board of Directors.

Significance and Functions of Board of Directors

According to a research study conducted by PwC, “Ninety-one percent of directors find new members through director recommendations, suggesting a preference for referrals by someone they know and trust. However, 67% use search firms.”

The constitution of company is never complete without a Board of Directors. At the start, it can be a single person – the lone founder – who represents the board. But it cannot go on like this for long as you will not be able to avail the benefits that are associated with having a board.

A board of directors plays an indispensable role in constitution and governance of most enterprises. The board is responsible for the firm's financial decisions and ensures smooth running for different legal procedures. The board has the authority to select, compensate and replace key executives, when necessary.

The major functions of boards members include:

·         Analyzing and facilitating corporate strategy and major plans of action

·         Reviewing and guiding annual budgets, business plans and  risk policy

·         Setting performance objectives & ensuring their execution

·         Monitoring corporate performance

·         Overseeing major capital expenditures, divestitures and acquisitions

A nominating entity – usually the founder – first nominates the members for the Board of Directors. The nominated members are then elected by shareholders through voting. It is important to select experienced and responsible board members who can contribute efficiently in the growth of the company.

If you are looking for some effective guidance on selecting the right set of board members, you can seek some useful advice from CEO peer groups. The stalwarts and industry leaders from non-competitive organizations meet at a CEO conference and share their experiences and knowledge with a candid, honest, no-holds-barred approach.

CEO groups act as a great platform for aspiring entrepreneurs to seek help and counseling to build a successful business entity.

In this blog I have discussed the importance and functions of a Board of Members. In my next blog I will suggest some tips that you should consider while nominating directors for your enterprise. Watch this space!

Take Advantage of Social Media For Your Business

Over the past decade, the way people communicate and connect with each other has changed radically thanks to social networking platforms.

No business owner or a serious marketer can overlook the importance of the web. Social networking sites such as Facebook, Linkedin, Twitter and the newly launched Google+ are the top most platforms for creating a buzz about your products, services, events or announcements.

Unfortunately, many business owners fail to take proper advantage of such mediums. Creating a strong online presence for your brand or business, you would have to be visible on social media sites. The biggest advantage of a social media site is that it connects you to your target audience directly- potential customers, shareholders, and rival companies.

You can post comments on Facebook, post tweets and re-tweet on Twitter, or start a discussion on any of the sites. In real time, you are able to get in touch with potential customers, understand what they are looking for, present them solutions in the form of your products or services, find out if any of your customers are unhappy with your products and respond to customer queries.

Using social networking sites for business purpose is cost-effective. Not only does it help you attract new customers and keep in touch with the existing clients, you also can hire new employees. You can even recruit potential candidates by posting job vacancies in your company on Twitter or Linkedin accounts.

You will be amazed to receive a good number of responses in real quick time. You don't have spend money on recruitment consultants. A job post on Linkedin social networking site where qualified professionals are always on the lookout for good opportunities is a good source for hunting for skillful and talented people.

Social media has changed the way people read, discover, and share information, and news. You just need to use your corporate business skills to take advantage of social media and launch a successful marketing campaign.

Apart from social media, you also have to look out other avenues to improve yourself and upgrade your knowledge. As a business owner, you need to keep updating yourself to stay ahead of the competition. Joining an executive business coaching or a corporate business coaching can help you get in touch with experts, share ideas and learn innovative ways to take your business to new heights.

Make sure the language you use on the social networking sites is simple and appealing to your particular target audience and captures the ethos of your firm. For instance, on Twitter you can use casual language whereas on Linkedin, your style of writing needs to be professional and business like, so post your content accordingly.

Foreign Market Calling? Consider these Tips Before Making the Move!

Global trade has no dearth of opportunities for your business, provided you prepare yourself adequately to enter foreign markets. 

The success of the companies like Sony, Samsung, LG, Reebok and Volkswagen – that have their roots in Europe and Asia -- in different countries across the world has also encouraged many enterprises to walk on their path. 

Even the small businesses can make their way to the global market through different routes. They can, for example, market their products via local distributors, sell to customers based in export territories directly, enter into joint ventures with local business enterprises, or offer products through a website. 

Though opportunities are there, success is not guaranteed. At the end of the day what matters the most is how your strategies worked in an unfamiliar market. 

Here are some tips that can help you prepare for your big stride into new markets.

Understand the Culture

Before you design your strategies to promote your products and services in a foreign market, update yourself with customs and business etiquette of the market you are planning to venture into. It can even include -- the history of that country, salutations used to greet someone, and the lunch hours or the prayer timings (in case of Middle-Eastern, African, Asian and countries). 

Stay Updated With the Foreign Trade Policies and Other Economical Details

Study in detail about the foreign trade policies of that country and figure out how it would facilitate your business. It is crucial to keep yourself informed about how the country’s currency has fared, its value fluctuations, and import/export timelines as it is always advisable to avoid speculation and work on locked in currency rates and delivery dates.

You should also stay updated with the business-wise foreign direct investment limits of different countries. It will help you choose the right country – the one that favors your business model and potential for profit. 

Join a CEO peer group when you plan to expand your business across the global borders. The CEO group – a rendezvous of industry leaders – offers corporate executive coaching that increases your chances of making profit as you get guidance from somebody who has achieved this feat with success. 

We will be discussing some more points on the same topic in our next blog. So watch this space!