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There seem to be a range of articles around at the moment analysing the current problems at Ferrari. There are suggestions that Ross Brawn is returning, that Eric Boullier should be recruited, or that Ferrari should relocate to the UK, as they once did in the 1980s.

To add my own pennyworth into the discussion, I see the problem as one which impacts on many organisations around the globe. The problem is the nature of the relationship between a specialist business unit and the corporate centre. Corporate centres, and the senior managers within them, like to feel they are the ones in control, they are the ones that call the shots, and, generally, because they own the overall business, they are correct. However the managers in the business unit are the ones who really understand the industry, the market and how to get things done in this particular situation. So there is inevitably a tension between these two worlds. The term often used to describe the relationship between the business unit and the corporate centre is corporate parenting.

There are many different approaches to corporate parenting. At two extremes we have the laissez faire approach where – to extend the parent/child analogy – we don’t care what our children do, as long as they are getting the right results. We don’t tell them when to work on their homework, or what to write in their reports, we give them a set of boundaries and we let them get on with it, we judge them by their results rather than their activities. In a corporate sense this could be like the relationship between Tata and Jaguar Land Rover. Tata don’t tell JLR what cars to build or where to sell them, they set some overall targets and tell them to get on with it. At the other parental extreme we micro-manage and attempt to control everything our children do. We tell them when to do their homework, we continually check their work (whether they ask or not) and suggest how they could improve things in a great deal of detail, and perhaps we even end up doing it for them. This is over-protective parenting, where we focus on control and micro-managing activities in the assumption that this will produce the best results. This is analogous to the relationship between JLR and their previous owners the Ford Motor Company. In this relationship they were told what models to lauch in what markets, how to price, market them etc. In other words the managers in the business unit were being micro-managed by the centre, unable to do the things that they felt would work best in their specific markets.

Ferrari are the most successful team in F1. Ever. Their most successful period owes much to the driving skills of Michael Schumacher, the technical orchestration of Ross Brawn, the design brilliance of Rory Byrne and engine director Paolo Martinelli. But it owes equally as much, if not more, to the management style of Jean Todt. Todt protected the F1 Team from the parent Fiat. This also would not have been possible without the support from, then President, Luca di Montezemolo. Montezemolo had been responsible for appointing Todt. It was always tempting for Fiat/Ferrari to meddle with the F1 team, particularly in the mid-nineties when the results were not yet there, but this would ultimately have destroyed their ability to compete and dominate F1. Just look at what happened when the Ford Motor Company took over Stewart Grand Prix and turned it into a corporate political football called Jaguar Racing. The team lost its direction and leadership and ultimately failed. When they then became Red Bull Racing the story was somewhat different.

Parents who micro-manage their children may be well-intentioned, but ultimately misguided. If we want our children to become capable, well-developed individuals, we have to give them space to grow, make mistakes, learn and build their own capabilities. Organisations are no different. The main problem I see at Ferrari is the managerial style and approach of Sergio Marchionne. As Chief Executive of Fiat Chrysler he has ended up micro-managing the F1 team – Scuderia Ferrari. He has made their success in F1 a very personal crusade and he has also been quick to get rid of those that he saw as not supporting his approach. Hiring and firing can be very important to build a great team, but, if done badly and for the wrong reasons, it can destroy a great team and create a culture of blame and fear from which success will never grow.

Great leaders are great enablers. Their secret is that they allow others to flourish and develop and bring their abilities to the organisation. Just look at how Mateschitz built up Red Bull Racing. He doesn’t micro-manage. He has good people in place, they know about racing, and he lets them get on with the job. Marchionne should take a step back and give Scuderia Ferrari and its leaders the space they need to build future success.

Inspired Leaders Network

July 21, 2016

On 5 July 2016 I took part in a panel discussion at an Inspired Leaders Network event held at the London School of Economics. I shared the stage with my co-author on ‘Performance at the Limit’, Ken Pasternak, and Williams F1 Chief Technical Officer Pat Symonds. Hosted by the ILN’s own business guru René Carayol, the focus of the discussion was the learnings that organisations and leaders can take from looking at the world of Formula 1. As ever, Pat was succinct and insightful in his comments and Ken and I were able to reprise some of the key messages from the third edition of the book. You can find a review of the event and some video clips here:

http://www.inspiredleaders.com/event/performance-at-the-limit

On 29 July 2013, the day after the Hungarian Grand Prix, an interesting piece appeared on the Ferrari website entitled ‘A turning point to tackle with a knife between the teeth’. It related the comments of Ferrari President Luca de Montezemolo, who was apparently less than happy about the team’s performance, and also the behaviour of its lead driver, Fernando Alonso. The piece stated baldly that Montezemolo had ‘tweaked his (Alonso’s) ear’ reminding him that “all the great champions who have driven for Ferrari have always been asked to put the interests of the team above their own. This is the moment to stay calm, avoid polemics and show humility and determination in making one’s own contribution, standing alongside the team and its people both at the track and outside it.” Nobody seems entirely sure why Alonso was on the receiving end of Montezemolo’s ire, but one theory is that it was his reply when asked what he would like for his (forthcoming) birthday, his response was ‘a new car’.

The public castigation of Ferrari’s most expensive employee by the President gave me a real sense of déjà vu. Last night I was re-reading one of Niki Lauda’s memoirs ‘For the Record’ written in the late seventies and focusing on his experiences during the season of 1976 when he almost lost his life and did lose (by a very small margin) the World Championship to James Hunt. I had got to the part where he was being criticised in the media by Enzo Ferrari saying that he made a mistake by coming back too early for the Grand Prix at Monza. Enzo Ferrari was renowned for communicating his pleasure or otherwise with the race team, Gestione Sportiva, via the media and it seems that Ferrari’s current President is following a similar line. However, interestingly, Montezemolo started off by saying that “The Ferrari I saw in yesterday’s race doesn’t sit well with me.” If he is following Enzo’s tradition of criticising his drivers through the media, he is not following his other tradition of never criticising his cars, but then I guess they don’t have his name on them.

One of my most enjoyable Christmas presents this year came from my mother-in-law. It was the biography of Steve Jobs by ex CNN CEO Walter Isaacson, it was an impressive read, not just in terms of Jobs himself, but also in terms of the way Isaacson managed to combine the social, emotional, technical and business dimensions to build a deep and insightful portrait of the man. When my latest edition of Harvard Business Review arrived it contained ‘The Real Leadership Lessons of Steve Jobs’ by Walter Isaacson, there has been a lot of poor quality writing about Steve Jobs, particularly in terms of the ‘leadership lessons’ variety, but this was one article I was going to read at all costs, and so last night I did.

It confirmed many of the insights I got from reading the book and which I have used in my strategy sessions with our MBA students, Steve Jobs is very much an inspirational figure, as much for his dark side as the light. As I was going through the HBR piece it suddenly struck me that many of his qualities and quirks I had come across before in an individual who has been as innovative and revolutionary in his spheres of work as Jobs had in his, Colin Chapman.

If I look across Isaacson’s lessons many (but not all) relate very strongly to my picture of Colin Chapman. The importance of focus, the ability to cut through a complex technical issue to the core – think of Chapman’s ideas for fuel sacks rather than tanks which came out of them trying to thread the tanks through a complex spaceframe, the search for elegance and simplicity – Jobs hatred of using screws in his products, Chapman’s concept of the monocoque chassis in the Lotus 25 and the engine becoming part of the structure of the car in the Lotus 49, the lack of tolerance for any who were not ‘A’ team players, it can be said that neither Jobs or Chapman were model managers particularly on the people skills front and yet both had the cream of the crop wanting to work with them, why? Perhaps because they were the best, or perhaps because people saw the interpersonal deficiencies as symptomatic of someone in an hurry, someone who was going to get things done, make things happen and this was a ride they were not going to miss. There was also Jobs’ famous Reality Distortion Field where the impossible became possible, this was very much reminiscent of Chapman where the car could be redesigned and rebuilt just before the race, to incorporate a new innovation thought up by Chapman that day! And perhaps the best of all: ‘When behind Leapfrog’ – anyone remember the Lotus 78? In the mid seventies Lotus had fallen behind and so Chapman got Tony Rudd, Peter Wright and other brilliant technical minds to go back to basics and redefine the grand prix car, no copying competitors, just developing the best solution, in this case ground-effect aerodynamics.

Of course there were also differences. As far as I’m aware Chapman was not a fan of Zen Buddhism, Chapman was also an adept collaborator and, unlike Enzo Ferrari, did not feel the need to build his own engines, Jobs, in contrast, wanted to control the whole thing from end to end, he would have instinctively gone down the Ferrari route. So there were differences, but on balance the similarities win out, for me the most poignant are that both started their businesses in their garages from nothing (although in Chapman’s case this was a stable behind his dad’s pub), and sadly both left us well before their time.

There is no question that Sebastian Vettel is a worthy driver’s champion for 2011. He had the best car, but he rarely put a wheel wrong, and so his title is undoubtedly well deserved. I do feel that Sebastian, like Lewis before him, is very much a champion who, although a worthy champion, is still highly dependent on the support of the team for the title, this I would contrast to other champions who really lead their teams to victory. It is the difference between someone who is dependent on the team for their success and someone the team is dependent upon, someone who brings the team up with them.

I guess the contrast I would draw would be the difference between Michael Schumacher at Benetton where supported by Flavio Briatore, Ross Brawn and others he achieved two world championships, here he was a champion, but not a leader. In contrast, during Michael’s time at Ferrari he played a very key role in turning round the whole organisation , becoming the catalyst for change and winning the greatest number of championships that have ever been won, Michael grew from being a champion to being a leader. Similarly, I would also put Fernando Alonso in the leader category, he played a key role in the success of Renault in the 2005/6 seasons and has gone on, with a brief blip at McLaren, to do the same at Ferrari. If we look back into previous champions individuals like Ayrton Senna, Alain Prost, Niki Lauda and Jackie Stewart all fit with the leadership role. The interesting question for me is where Jenson Button is on this, in many ways he seems to be stepping up to the leadership role this season, not only through his performance on the track but his demeanour, his confidence, his approach are all suggesting something stronger than a driver who just gets in the car and performs on the track.

So the obvious thing for Sebastian to do now, or certainly in a year or two, is to move to a new team that needs a leader and see if he can shift up a gear from being world champion, not easy, but some have done it. Who knows, like Michael at Ferrari, he may even persuade Adrian Newey to come with him.

There are relatively few examples today of where a single leader imprints their personality on an organisation. A couple from contemporary businesses would be Steve Jobs at Apple (now holding more cash than the USA) and Richard Branson at Virgin. The question will be how long after these individuals have gone will their shadow remain in these organisations? I am reminded of a documentary I watched on the making of the Disney animated film Hercules. The Artistic Director was artist Gerald Scarfe (remember the animation of Pink Floyd’s The Wall? – that was Scarfe). There was one scene where Scarfe had drawn a satyr which showed a certain amount of buttock cleavage, ‘I don’t think Walt would like that’ said one of the Disney animators, who’s Walt I immediately thought, was he one of the producers? He was referring to Walt Disney who died over forty years ago, but clearly his spirit was alive and well throughout the organisation.

I have been very fortunate to have been able to meet and occasionally interview many of the movers and shakers in F1, but if I had to select the one person I would have loved to ask some questions to, above all others, it would have been Enzo Ferrari. Like Walt Disney, Enzo’s presence is still very much in evidence at Ferrari. The term ‘racer’ is often used to describe someone whose very being is driven by the need to race, and win races. If all of the money disappeared from F1 many people would disappear, but the racers would still be there. Enzo was the original racer, he was, at one time, a works driver for Alfa Romeo, he created one of the first motorsport companies: Scuderia Ferrari which provided cars and the support for rich individuals to go racing. His road car operation was there to help raise funding to go racing. Many car manufacturers have tried to emulate the Ferrari mystique by racing to promote their road cars. None of them come close and the reason is Enzo Ferrari, his passion and his values. I recently managed to get a copy of his autobiography ‘My Terrible Joys’, it is one of the best motorsport books I have ever read, it is candid and insightful, it is, of course, his view of the world, but it is all the more engaging for that.

It is now twenty three years since Enzo’s death and Ferrari have just put a piece on their website asking for comments on the great man:  http://www.ferrari.com/English/Formula1/News/Headlines/Pages/110814_In_memory_of_Enzo_Ferrari.aspx

I am certain that Enzo’s shadow will be there for as long as there is a prancing horse on a Ferrari.

With Sam Michael and Jon Tomlinson leaving Williams, and the news that Aldo Costa will be standing down from the Technical Director role at Ferrari, it looks like some of the F1 teams are getting into panic mode and believe that a bit of firing is needed. Unfortunately, although such managerial machismo may create the impression of decisiveness from the top, it will only work if these specific individuals are the real source of the problem. Quite often this is not the case, and that means that the problem remains but is now compounded with all the effort and disruption of recruiting or promoting new people and integrating them into their new roles.

When we interviewed Ross Brawn at Ferrari back in 2004 we asked if there was a particular innovation that had created their success, this was his response: “… if we had an innovation here it’s the fact that we combine the engine and the chassis together as one whole, but we apply that principle to all areas of the car with the electronics, the engine, the chassis, the aerodynamics, the structure, it all had to be a whole, there was no point in having one area very strong and the other area weak.” Aldo Costa had replaced Ross in this overarching role focused on ensuring that all the departments worked together to get the best overall result – this role requires not only managerial skill, but also technical knowledge and capability, these ingredients are only found together in a few key individuals, Ross Brawn is one of these and apparently Aldo Costa is not. However Ferrari have now segregated the technical roles into chassis (Pat Fry), engine and electronics (Luca Marmorini) and production (Corrado Lanzone), each reporting into the team principal. This implies that the only person with an overall responsibility and overview is Stefano Domenicali. Stefano is a lovely guy and a great manager, but he doesn’t have the technical insight of a Ross Brawn to knit the whole thing together, that is what Ferrari need now.