A decade ago, our firm took a step that has proven to be one of the best moves in the history of our company: putting in place a board of directors. I arrived at that decision after it became clear that achieving the levels of continuous growth and expansion that we aspired to would require additional expertise and experience to build on our leadership team.
For owners of staffing firms, a board of directors can be an invaluable resource by providing guidance, perspectives and oversight about a range of issues and functions that are essential to your firm’s success. If this approach sounds like it could be right for your company, this article offers several considerations and recommendations for developing and maintaining an effective board of directors.
Getting Started
Begin by determining the type of board that is the best fit for your organization. Examples include a working board, advisory board or governing board. The role of the board could change over time as the firm’s needs evolve. An advisory board could transition to a governing board, for example.
Then, develop a board guidebook that provides comprehensive information about the board and company. This may include board member job descriptions, the succession plan for the company, a summary of governance policies, and job descriptions of the company’s senior leadership positions. There are many resources that can help in planning and implementing a new board; I took a three-day class at a local college.
The next step is to identify the expertise your company needs as it plans for the future. In our case, this included a legal advisor with expertise in mergers and acquisitions, a finance expert with experience working with private equity investors, a former customer who could bring perspectives from that vantage point, and others with extensive business management and corporate leadership experience. We purposely started with board members that didn’t have staffing industry experience and would bring perspectives and learnings that we might not have otherwise considered.
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Moving Forward
Our board has been instrumental in overseeing the growth of our company over the past ten years. As staffing firms grow and expand, so too should the expertise of their boards. This likely will mean seeking board members with direct experience in the staffing industry who understand the complexities and nuances of the category.
Board members that have a track record of working in the staffing industry are well equipped to evaluate strategies and provide guidance. These individuals also have existing relationships with people throughout various facets of the industry that they can bring to your business.
Beyond its primary fiduciary responsibility to the company, such as overseeing stock options plans for employees, the annual operating budget and compensation strategies, a board can offer important benefits to an owner/CEO that may be less tangible but are especially necessary as a firm grows. For example, they can serve as a sounding board for owners and CEOs across a wide range of issues, topics and ideas.
As a side note, in addition to this type of engagement with board members from the industry, CEOs may want to consider participating in learning and information-sharing opportunities with their counterparts. A monthly virtual forum with leaders from other (non-competitive) staffing firms can be motivational and educational.
Finally, don’t hesitate to ask people who you think would be good board members but might not have the time or interest. Practically every prospective board member I’ve met with was interested in sharing their knowledge and experience and helping companies.
Now more than ever, overseeing a successful staffing company requires the support and guidance of an extended team of advisors. A board of directors at the center of that group can play an essential role in helping your firm consistently get to the next level.