“IT’S NOT WHAT YOU KNOW – it’s who you know”. If this is true (and it often appears to be) should your network be broad (lots and lots of people) or deep (fewer people, but stronger relationships)? In order to tackle this question, let’s look at some examples of the kinds of issue boards can face, and who are the people best able to help them.
In need of specific industry expertise: When entrepreneur Ramsey Khoury, CEO of digital agency Head London, established his company over 12 years ago, he had come from the fashion sector. Five years on, he realised he needed help in the form of a non-executive director to clarify the company’s vision. Further, he recognised that he needed someone with experience of running a digital agency. He talked to his networking contacts to explore potential people, in the end appointing the ideal candidate that had been referred by a business owner friend. The person made a huge difference strategically – as Ramsey said, “He helped get my head around what needed doing.”
In need of specific industry knowledge: As a non-executive for an NHS Trust, Lynne Cantor realised that the board needed to find out more about becoming a Foundation Trust from Trusts that had already made that step. In particular: what were the pitfalls, what did they actually have to do to achieve Foundation status and how did they develop a more strategic approach? Lynne linked up with an industry body – the Foundation Trust Network – that was the ideal forum for sharing the kind of knowledge she was after. Furthermore, it also encouraged the sharing of best practice from other sectors such as employee engagement from the likes of Unipart Group.
Searching for investors: Mathew’s company in the retail services sector was on the verge of landing a massive contract, however it needed to raise multi-million investment. His Chairman, having come from a Venture Capital background, had a number of contacts, and also knew how best to approach potential investors. In the market conditions prevailing in 2010 even this knowledge was slow to deliver results. However, in the end, £1m was raised through his direct contacts.
So we can see a mix of both a broader contact base (for industry knowledge) and deeper relationships (for when you need trust and understanding). There’s also a difference of emphasis depending on the size of the company.
For larger organisations, there tends to be a bigger pool of expertise and knowledge to draw on to tackle the significant strategic issues, including its established consultants and advisers as well as internal staff. The downside is that such organisations may lack that fresh approach that comes from an external, objective view, unless they ensure they have a diverse mix of non-executive’s to provide it.
For smaller companies, the issue of finding the right kind of people to support strategy development involves a variety of approaches.
As Ramsey Khoury noted, while it’s important to have industry experience, “you want to have a healthy mix on the board – someone wise and experienced from other sectors will be able to ask the right questions.”
For those SME’s that may not be ready for a full -blown Board just yet, there are alternatives. Groups such as the Academy for Chief Executives (ACE) bring together around 10-12 business leaders from non-competing sectors for a day a month, with significant time devoted to sharing key issues and getting objective feedback and suggestions. Norwich-bases accountants Rostrans has created a “Leadership Group” of eight of their SME clients that meets every two months to help challenge each other and “man-up”, i.e. actually deal with any underlying problems. The regularity of the meetings and consistency of the groups develop those deeper, trusting relationships.
Non-for-profits face similar issues and there are organisations such as the ELLA Foundation that are using the above types of process with leaders from the charity sector. But there’s more than just receiving input on key issues facing the organisation. As Mike Burnage of ELLA commented, “I’ve seen great examples of charities making resources available to each other and sharing best practice with new staff from another member organisation.”
Overall however, the key is to find people who think differently to you. If all your contacts have a similar perspective you risk missing out on being introduced to alternative scenarios. As a client and member of ACE, Bee Kemball, MD of Debach Enterprises said, “It really opened my eyes to witness the diverse approaches people would take to the same problem.” She has broadened her own management team as a result of this awareness.
So for you to add more value to the boards you sit on, or to the boards of your clients, I’d advocate you need both breadth and depth in your network.
To increase breadth: Get talking to people! It can be just as effective through your hobbies, friends and family contacts – as well as striking up conversations with strangers.
To increase depth: Seek out a non-executive and explore groups such as the Academy for Chief Executives.
Finally, if you’re considering joining a networking organisation, make sure the membership is diverse and that some structure exists for in-depth discussions. This way you will be able to develop both depth and breadth.
Hilary Briggs is managing director of profitable growth specialists R2P Ltd