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I didn’t, and when I learned I said to myself, “this just makes so much sense…why didn’t I think of it?” 

A mentor board is an organized group of people that helps younger generation members in a business learn necessary skills to run the business.  This board is different from a family council, business board of directors, or board of advisors.  Their only purpose is to get the next generation ready to take over the business.

A mentor board could be used in a family business, an ESOP (employee stock ownership plan), or for that matter any business that has succession issues.  I believe many businesses that could go for multiple generations don’t because the younger generation isn’t mentored and trained properly.

How does a mentor board train the new generation of leaders?  A mentor board should meet bi-monthly.  At the meeting the board will spend part of their time helping the new leaders understand what their role as cultural leader means.

The managers who serve on the board will help the new leader understand what skills they think the new leader should learn as they take on more responsibility.  The present leaders can help the new leader know what challenges the new leader is likely to face. 

Providing the new generation of leaders information in an open forum should foster open communication between seasoned managers and the new leader.  The new leader will hopefully learn to ask questions instead of telling those with experience how they should do their job.

A mentor board is a way to honor elders.  All businesses need elders.  These are senior generation people who have either passed retirement age or are about to do so.  Elders have institutional knowledge that has never been written down and in too many organizations hasn’t been passed on to others before they leave.

Having a mentor board where elders are members allow those with institutional memory to pass those stories on to the next generation of leaders.  I know that every time I have a chance to “pick the brains” of those who have been around for years I take advantage of the opportunity.  A mentor board makes the process a little more formal and likely to happen.

A mentor board can help guide the retiring business leader.  Many businesses think about succession issues from younger people taking over from older people.  We should also think about how senior members of a company should leave.

Proper training for retiring business leaders can help provide continued value for the business.  If retiring business leaders know there is a role in the business and what that role is they can continue to provide knowledge and support while they’re moving into a new stage in their lives.

We often don’t want retiring people around a business because they get in the way.  Instead of getting in the way, we can develop strategies and support through a mentor board for retiring business leaders to continue to add value to the businesses they helped create.

Who should be on a mentor board?  A mentor board should have rotating members so new leaders get exposure to different points of view.  There should be managers who will continue to work at the company, retiring managers, and outsiders who have gone through a successful retirement process. 

All bring different viewpoints to the mentor board.  Different points of view help smooth the transition process.

Now that you know what a mentor board is do you think it’s a good idea?  How would you use one in your business?

We’ve written a case study about hiring for unique abilities.  If you don’t hire great successor leaders a mentor board is not going to be very valuable.  Having a system in place for hiring this next generation is crucial.  Click on the button below to find out how the Aardvark companies became great at hiring.

Securities and Investment Advisory Services offered through NFP Securities, Inc. (NFPSI), Member FINRA/SIPC. Stage 2 Planning Partners and NFPSI are not affiliated.

This article is published for residents of the United States only.  Registered Representatives and Investment Adviser Representatives of NFP Securities, Inc. may only conduct business with residents of the states and jurisdictions in which they are properly registered.  Therefore, a response to a request for information may be delayed.  Not all of the products and services referenced on this site are available in every state and through every representative or advisor listed.

Topics: business coaching, business exit planning, Mentor, succession planning

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