Bored With the Board
Bored With the Board
Our 68-year-old family business is faced with restructuring our board of directors. Three of our six directors want out, and I'd like to replace them with outsiders. What mix of business knowledge is advisable? What kind of people are most effective?
Victoria, Tex.* * *
Although most family-owned businesses cheer the notion of inviting outsiders in, fewer than 10% can speak from experience. Those who can will assure you that the fear of losing control fades as soon as you see how the outsiders' objective input can beef up the bottom line or increase the company's overall competitiveness. You're smart to keep birthright in the proper perspective and to stress individuals' contributions. "You don't want to surround yourself with 'yes people," says Mark Nielsen, president of Wesbar, a maker of marine and agricultural products in West Bend, Wis.
When structuring your board, strive for "economic and personal chemistry" among members, says Léon Danco, founder of the Center for Family Business, in Cleveland. It's critical to save seats for experts in marketing, finance, and manufacturing or technology. Add a person who has grown a company in much the same way you want to grow yours, or someone who knows about the markets you plan to attack next. Welcome a creative generalist who can bring out everyone's best efforts. For more insight, study Danco's book Outside Directors in the Family Owned Business (Center for Family Business, 216-442-0800, 1981, $33.45). If you have any outstanding questions, call him.
Danco describes effective directors as "non-self-interested, risk-understanding peers" because they know their primary function is to support management's and shareholders' goals and bolster their collective wisdom. The best of them can play both business owner's and devil's advocate, since they've been in the hot seat and know what questions to ask. Seek out problem solvers who are articulate, resourceful, cooperative, and willing to share stories of their victories and defeats. Danco suggests another book -- John L. Ward's Creating Effective Boards for Private Enterprises (Jossey-Bass, 415-433-1767, 1991, $27.95) -- as an excellent guide to building a dynamic board of your own.
If you take the time to shop for outstanding people, their input can be invaluable. That's why you should think of fees as mutually agreed-upon tokens of respect and seriousness of purpose. It's appropriate to pay annual amounts ranging from $3,000 to $10,000 for each outside director. For more tips on picking and paying directors, Wesbar's Nielsen recommends the seminars and newsletters offered by the National Association of Corporate Directors (202-775-0509).* * *
Where can I get a list of agencies that raise funds for nonprofit organizations?
John Hammer & Associates
Irvine, Calif.* * *
Most businesses that specialize in fund-raising for nonprofits offer management-, financial-, and marketing-consulting services as well. A list of international members of the American Association of Fund-Raising Counsel (AAFRC; 212-354-5799) is available free. The directory lists principals, locations, and areas of specialization for 25 such businesses and gives tips for choosing fund-raising consultants. AAFRC members have already been vetted: they undergo a rigorous application process and must adhere to strict ethical guidelines regarding conduct and setting fees.
Or you could go the do-it-yourself route. Alan Chambers, executive director of City Cares of America, in Washington, D.C., handles his nonprofit's fund-raising in-house, gathering tips from his area trade association for nonprofits. The Washington Council of Agencies, like its sister organizations in numerous states, holds monthly seminars on fund-raising, management, and networking. Membership fees are on a sliding scale, based on a nonprofit's budget. Call the National Council of Nonprofit Associations (202-785-3208) to find agencies in your area.
For more focused training, nonprofit managers can attend classes at one of 14 offices of the Support Center for Nonprofit Management (415-552-7584), which are scattered across the country. Volunteers from the private and nonprofit sectors teach seminars on management, financials, and computer literacy. The cost is linked to the nonprofit's budget.
To keep in step with nonprofit happenings, Chambers and other industry insiders read "the newspaper of the nonprofit world," The Chronicle of Philanthropy (800-347-6969; an annual subscription costs $67.50). The biweekly covers fund-raising techniques, management issues, and news relating to nonprofits.* * *
I am a self-employed financial consultant and need to put together a professional-looking brochure or marketing kit. What are my options?
Premier Financial Services
New York City* * *
Overall, brochures must appear professional and unintimidating. They needn't be slick on the outside, but the writing must be jargon-free, factual, and crisp. Your objective is to create credibility with would-be clients, says Jeff Slutsky, president of Streetfighter Marketing, a training and development business in Columbus, Ohio. "Customers won't say yes right away, but they will say no if they're not initially impressed."
You can make a terrific first impression on a tiny budget. Slutsky crafts his information kits from generic two-pocket folders (50¢ each). On the outside is the company logo; inside are Slutsky's card, a cover page, a list of services, Slutsky's credentials, and any requested information, as well as testimonial letters and any media coverage he's gotten.
Slutsky can often cut deals on typesetting, trimming, binding, and copying because he has a great relationship with his local quick printer. He buys in bulk, knowing he can hand out any extra marketing sheets (made for as little as 5¢ each) at conferences, seminars, and trade shows. He also saves the $30 setup fee by using the color the printer already has on the press.
At large print shops with graphic designers on staff, ask to see the artists' portfolios. Or rent one of the shop's computers ($8 to $9 an hour) and do everything yourself. "It's less costly than hiring an independent designer or an ad agency," notes Tom Carns, president of PDQ Printing, in Las Vegas.
If you have access to a computer and a laser printer but you're short on creativity, copy this strategy: Chris Ritchie, a second vice-president of commercial marketing for the Chase Manhattan Bank in New York City, solicits new accounts with customized, industry-specific brochures made by using PaperDirect's PaperTemplates add-ons for software packages (800-A-PAPERS, $39.95). He just chooses a preformatted brochure design, arranges the text, and prints the results. "The templates are easy to use and inexpensive," Ritchie explains.
If you're still hungry for inventive promotional ideas, Slutsky suggests you read Howard Shenson's Shenson on Consulting: Success Strategies from the "Consultant's Consultant" (John Wiley & Sons, 1990, $27.95), which covers the basics of writing, producing, and distributing a brochure.* * *
Not Just for Women
Several readers are hunting for books that address the pivotal questions faced by woman entrepreneurs at various stages of the company-building process. Here are a few titles. (And we'd love to hear about your favorite reads.)
When it comes to texts on reinventing business philosophy, there are two front-runners. Joline Godfrey's ground-breaking Our Wildest Dreams (HarperBusiness, 1992, $20) asks the questions that will help people build profitable companies that are spiritually and psychologically rewarding and fun. And there's Anita Roddick's Body and Soul (Crown, 1991, $22). Quoting from Body and Soul , Sharon Hadary, executive director of the National Foundation for Women Business Owners, in Washington, D.C., says, "If you have a company with itsy-bitsy vision, you have an itsy-bitsy company."
There's good practical advice in Geraldine Larkin's Woman to Woman: Street Smarts for Women Entrepreneurs (Prentice Hall, 1993, $14.95), which helps readers make critical business decisions with the help of diagnostic checklists and work sheets. It also offers no-nonsense advice on managing people, time, and money.
Positive reinforcement abounds in The Woman Entrepreneur: 33 Personal Stories of Success (Upstart, 800-235-8866, 1992, $14), recommended by Barbara Lambesis, general manager of Marketing Methods, a Phoenix consultancy for entrepreneurs. Lambesis says the book is more of a "Why I started a business" book than a how-to. The book's coauthor, Linda Pinson, agrees, offering a reason for the book's popularity among men: "It's about overcoming roadblocks in a positive way. It shows that encouraging women needn't go hand in hand with male bashing." One success story is that of Enita Nordeck, founder of Unity Forest Products, a lumber remanufacturer in Yuba City, Calif. (See "Against the Grain," November 1992, [Article link].) Here's Nordeck, in The Woman Entrepreneur: "You must seek knowledge, not stand passively by and expect it to be handed to you."
And for some insights into the tricky business of integrating personal and business goals, try Sheila West's Beyond Chaos (NavPress, 800-366-7788, 1991, $15). For her part, West, the cofounder of ACI Consolidated, a former Inc. 500 company in Monroe, Mich., recommends Charles Garfield's Peak Performers (Avon, 800-238-0658, 1986, $12). "It made me realize that skills -- especially homemaking skills -- can be transferred to the business world." Sure, Garfield happens to be a guy, says West, but that doesn't prevent him -- or any other male author -- from giving smart business advice to women. "You have to be willing to take that wisdom, reinterpret it, and make it your own." n* * *
Reported by Karen E. Carney, Vera Gibbons, and Phaedra Hise.