On a recent Tuesday just after noon, D. Penn Moody, an Indianapolis optometrist and owner of Moody Eyes, was the first business owner to present a problem to his peer advisory group.
Moody had recently expanded his vision practice and eyeglasses store, and he said he was having difficulty in balancing medical consultations and product sales. When a medical equipment manufacturer from Boston asked what his value proposition was, Moody replied, “I think the value proposition is that we’re the middle of the road.”
That sounded vague to Chris Ronzio, founder of the Event Video Co. of Beverly, Mass. He suggested offering more VIP services. The medical equipment manufacturer advised Moody to send his employees to visit successful competitors. And a business consultant based in North Carolina, Marty Clarke, suggested that if everyone who walked into the store were asked for a “wish list,” Moody’s employees could focus on consulting rather than selling.
The suggestions struck a chord with Moody, 61. When the facilitator asked him what action he planned to take, Moody said that he had already been sending his employees to visit competitors but that he would rewrite his value proposition and rescript the first five minutes of interaction between the staff and customers. He set a three-week deadline.
Soon, he and his fellow attendees said goodbye, shut down the Web-conferencing platform they had been using to meet, and went back to work.
Heading a small business can be a lonely job. There are always issues that are not appropriate to discuss with friends, employees or family members, so even experienced entrepreneurs can feel lost.
“I remember starting my company and thinking, ‘I don’t have any colleagues,’” said Caroline Daniels, owner of a property rental company in Nantucket, Mass., and a lecturer in entrepreneurship at Babson College. “There wasn’t anyone to bounce ideas off. And even if your instincts are good, you wonder, ‘Is this good or crazy?’”
In recent decades, business owners and chief executives have turned increasingly to so-called peer advisory groups. Today there are many such groups with chapters across the country, including the Alternative Board, Entrepreneurs’ Organization, Vistage International and Women Presidents’ Organization. The first modern group is thought to have been founded in 1957, when Robert Nourse, a Milwaukee businessman, created the Executive Committee, later known as TEC.
Not surprisingly, peer advisory sessions can feel like group therapy for high achievers. In structured sessions, owners take turns presenting their business problems to a dozen or so peers, owners of local but noncompeting businesses. After each presentation, the other members ask questions to extract more details and get at the “real” issues. They help the owner devise a plan to address the issues. Finally, the owner sets a deadline and designates someone in the business or in the group to see that the plan is carried out.
But these groups have limitations. They require that members live in an area where there are enough interested owners to form a group. Even then, owners may not find a group that fits their schedules or needs. The required investment of time is high, usually one full day a month with additional one-on-one coaching sessions. And the groups are expensive, often $10,000 a year or more.
Now, however, peer groups are moving online.
About two years ago, Vistage, the former TEC (some branches use the old name), decided to develop a Web platform. With more than 15,000 members in 15 countries and $120 million in annual revenue, Vistage is the largest of the profit-making peer advisory companies. (Others, like Entrepreneurs’ Organization, are nonprofit.) Its investors include Lawrence J. Ellison, chief executive of Oracle; Michael R. Milken, chairman of the Milken Institute; and Thomson Reuters.
Vistage wanted to address two issues. “One, could we provide a peer advisory service that’s not geographically dependent?” said Casey Jones, general manager of the online service that Vistage developed. “And, two, could we lower the cost, and thus reach a larger population?”
What emerged is Vistage Connect, which opened to the public in April. The service, part social network, part library and part conferencing platform, features tabs across the top of its home page that allow users to enlist other members as informal board members. Members can also track their progress on business goals, sign up for online peer sessions and read how-to articles. The online sessions are based on topic rather than geography, meaning that users meet with different peers each session — but the aim is to replicate much of the live experience.
Vistage Connect costs $3,600 to $6,000 a year (depending on level of use), far less than the $13,000 cost of an annual membership in a live Vistage group. And members can get help quickly instead of waiting for a monthly meeting.