Do Masterminds Work?
Masterminds, the secret weapon you need to be more successful in business or just a waste of time, energy and money? For many business owners there is a serious question on what value masterminds bring and can they be quantified. We’ll explain what a mastermind is, and what it should do, illustrate clear and quantifiable ROI on a mastermind, and help you determine if one is right for you. Although masterminds have been around for years, they gained a following after Napoleon Hill released the best-selling book ‘Think and Grow Rich.’ The history of masterminds far precedes Napoleon Hill, however. Nearly every major institution and corporation today has an advisory board in place and we can trace advisory boards back as early as the 16th and 17th centuries in Europe. Evidently, advisory boards must be pretty effective if they have been in practice for such a long time. But, is an advisory board a mastermind, are they effective, and if they are effective, what are they effective for? Let’s start by defining what a mastermind is. Masterminds broadly speaking are a group of people that come together on a consistent basis to provide accountability, help provide support, and hopefully improve decision-making. Masterminds come in many different structures and flavors and no two are exactly alike. This makes masterminds quite broad and somewhat difficult to define more narrowly. However, there are many types of masterminds that are meant to be much more narrow in scope and terms, In particular, you have industry-specific masterminds, masterminds designed for particular business purposes (marketing as an example) and you also have peer advisory groups or owner advisory boards. The difference in each of these styles of masterminds comes down to the nature, intent, and structure of the groups themselves. Oftentimes the intent of the group defines the nature and the structure. For example, masterminds that are intended to improve marketing skills might by nature attract CMOs or marketing agency employees and the structure might be built to include a curriculum on how to implement marketing systems or processes to improve the marketing department in a company. The Owner Advisory Board Due to the fact that there are so many different types of masterminds we’re going to emphasize and focus on the Owner Advisory Board. The Owner Advisory Board is intended to bring together owners of small businesses that are similar in age and stage. In other words, bringing together peers from different businesses with similar complexity and challenges. Owner Advisory Boards naturally attract business owners in the early stages, the stages of sustainability, and the maturity and exit stages of business. As an aside, if you’re interested in the stages of business through the lens of the owner check out our previous blog and newsletter on The Owners Journey. The Owner’s Journey Business owners work through many stages during the time they run a business. For the most successful owners, they’ll take a business from ideation all the way…>> The Owner Advisory Board is designed to help owners address the universal challenges of isolation, overwork, and blind spots. Isolation and mental wellness are serious issues impacting owners and their businesses today. As many as 50% or more of business owners admit to being stressed out over their business and are concerned about the impact it has on the people around them. When it comes to overwork, over ⅓ of all business owners admit to working more than 50 hours a week and ¼ acknowledge they work over 60 hours per week. Putting the work culture aside, productivity has been shown to dramatically drop with anything more than 30-40 hours per week and yet it’s very rare to find owners working 30 hours or less per week. The unknown unknown is of serious concern to the majority of business owners out there. Less than 50% of business owners have a formal degree and large swaths of owners have never had formal education on critical business skills like financial controls and reporting, human resources, management or even sales! These challenges are very real and have consequences that influence the success and sustainability of a business. These challenges help illustrate why so many businesses are prone to failure and 83%, the vast majority of businesses, can never be sold. In order to address these challenges Owner Advisory Boards must have certain elements if it is going to be successful. Advisory boards must include a proven process to find the right people, a structure in place to help owners track KPIs and provide positive accountability and lastly must have exceptional support in place. Advisory boards should be highly selective in who they invite onto a board. Board members should be in similar ages and stages of business, should be dealing with items of similar complexity and opportunity and should also have varying strengths to help complement one another. Building out an advisory board with the right people is the most foundational aspect of a successful advisory board and is a full-time job! Not only does the board need to be composed of the right people with complementary skills and strengths, it also needs to have a structure in place that ensures accountability and results. The structure of advisory boards should be held in meetings that are peer feedback-focused. If the board is built of the right people then they are best served with a consistent forum that allows them to support each other and provide critical feedback on challenges and opportunities. This creates a safe space for owners to be very candid about their challenges and receive customized and detailed feedback in a constructive manner. This feedback can and will, when provided by the right people, provide context and perspective to allow owners to step outside of the lens they view the world through and come to better decisions. Support in an advisory board needs to be put in place by the facilitator. Having a board member facilitate a group shifts their role from a member of the