Well it turned out that Riker's beard was actually like KITT from Knight Rider - it's an artifical intelligence spawned by a secret government agency. It can talk and Riker often asks it's advice on away missions - usually asking for some gadget built into the beard to help out - again lot like KITT, however the conversation usually went something like:
Riker: Damn, the Ferengi have outbid us on the new superweapon offered by superbeing X. Beard use your computer hacking abilities to alter the superbeing's computer so that the Ferengi bid becomes a bid from the Federation.
Beard: I'm sorry Will, I'm just a beard.