As businesses watch every penny in their budgets in order to squeeze the most profits out of a slim economy, chief executive officers continue to agree that it is often necessary to hire appropriate expert consultants.
Outside consultants can bring the winning combination of experience and perspective. Consultants may also be the only party objective enough to identify a sensitive corporate problem and unbiased enough to offer the optimal solution, even if it is a painful one in terms of human resource staffing, benefits or other matters.
There is a way to obtain corporate advice, not from consultants but from other CEOs. Usually, a consultant is hired by a group of companies to organize and manage a roundtable of CEOs. This can significantly reduce the expense of a consultant to each company individually. An example of this type of arrangement is the roundtable group formed by The Executive Committee of San Diego, Calif.
The Executive Committee formed a group in Baltimore consisting of the presidents of a software company, a bus service and a transit company, among others. These presidents wanted "no holds barred advice" from their peers at the helm of other companies.
Each company sought a place in this arrangement in response to intensified competition of the global marketplace and the increased complexity of government regulations. So far, the members shared information on a formula for calculating bonuses, decisions on client selections and decisions on preparations for corporate reorganizations.
One of the group members likened the group to a "portable board of directors." The primary benefit cited by members is to simply use the group as a sounding board.
While the benefits of the roundtable approach are real, there are some group dynamics to consider. First, the members of the group must be honest and open in order for communication to take place. If the companies are immediate competitors or even in the same industry, this may stifle discussion, as members fear revealing a company secret which could keep them more competitive. If the issues discussed are generic to business in general or favor workable approaches to a "common threat," such as minimizing of tax burdens, then discussion flows more easily.
Second, the members must realize that criticism is meant to help each other and that large CEO egos may be bruised by comments aimed to improve a company's practices.
These days, by hiring a consultant to create a roundtable of CEOs, companies can gain a level of independent advice at a reasonable cost. …