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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.

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This week the FIA has released another technical directive designed to control the level of information being passed from the team to the driver. These regulations are getting increasingly detailed and will, in my view, confuse and complicate F1 racing rather than improve it. It will generate more protests and leave us with situations, as we experienced after the 2016 British Grand Prix, where fans leave the circuit still not knowing the final result of the race.

But aside from the regulatory problems, F1 is and should be the pinnacle of racing technology. We live in the era of big data. You can’t escape it and you can’t put the genie back in the bottle. Every organisation in the world is currently trying to work out what their digital strategy is, how they are going to maximise the use of data to improve performance. What is Formula 1 doing? It is trying to roll back the years to a time when the only communication between driver and team would be via a pit board or frantic hand signals.

Formula 1 is the most amazing exemplar of high performance. In F1 talent combines with technology to create amazing levels of performance, innovation and teamwork. And that is the point, Formula 1 is about teamwork. Drivers are the stars and we want to see them fighting on the track. But we also recognise that it is a team of hundreds (and in some cases thousands) of people that contribute to the on-track performance. We should recognise and celebrate the power of technology in F1. We should use it to the maximum to give fans more insight of what is happening in real time. I want to hear more interactions between the team and their drivers, not less.

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

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.

First, I must apologise for not posting for a while. I have a few work and family issues on at present, but hope to be back to normal (whatever that means) by December.

As Fernando Alonso sailed (almost literally) to victory in Korea last weekend I wondered how the managerial minds at McLaren and Red Bull were now turning to that dreaded subject – team orders. Both Martin Whitmarsh and Christian Horner made much of the distinction between their approach of two drivers who are clearly racing each other as well as everyone else, to that of Ferrari where the focus is on getting Fernando to the top step of the Driver’s World Championship. However that was when Fernando himself was less of a threat, and there were a few more races to go, now the situation is different. There are a maximum of fifty points up for grabs and Fernando leads the championship with 231, followed by Webber with 220, Hamilton with 210, Vettel with 206 and Button, who is the last driver who could mathematically beat Alonso with 189.

The view of most commentators is clear, McLaren have to get behind Hamilton and Red Bull have to get behind Webber if they want to win the Driver’s Championship. But will they? If, like Frank Williams, they chose to focus on the constructors’ championship – which after all is the basis on which Bernie’s media spoils are divided up – then Red Bull, with a 27 point lead, already have things pretty much in the bag. The other interesting dynamic at Red Bull is the attention that is paid to Vettel (particularly by Dr Helmut Marko) and his dominant performance in Korea which was undermined by his engine losing the will to rotate in a rather spectacular manner. Do you think they will tell Vettel he is now number two while he still has a mathematical chance of winning the championship? I think not.

At McLaren, under Martin Whitmarsh’s rather refreshing and open regime, I suspect it will be down to a good old team chat, and Jenson may well, as he himself has suggested, accept that the title is not within his grasp and fall in behind Lewis, but I suspect it will be down to Jenson to accept this as the way forward, rather than he be told, that isn’t the best way to manage a world champion. So we may have Ferrari and McLaren operating a world champion driver strategy in Brazil, behind Alonso and Hamilton, but Red Bull? I suspect they will stick to the wheel to wheel approach that they’ve held to so far, until it is clear as to who it is they need to focus on, of course by then it may be too late.

Jean Todt is now in the position of having to enforce the rules against team orders, rather than applying them

F1 has found itself in a rather silly situation, in that the rules say that team orders cannot be applied to alter the positions in a race and yet everyone recognises that this is practically impossible to enforce, so it will be interesting to see what the FIA’s World Motorsport Council makes of the goings on at the German Grand Prix this weekend. The current rules were created following the way in which Ferrari applied team orders at the Austrian Grand Prix of 2002. This was in the period when Ferrari were building up to their dominance of F1, with Michael Schumacher winning the drivers’ championship for five successive years between 2000 and 2004. It was clear to most of those following F1 that Ferrari had a clear strategy of focusing all their efforts on securing the drivers’ championship for Schumacher, with the additional driver providing a clear supporting role, however the way in which they secured the win in Austria with the unusually dominant Rubens Barrichello being asked to allow Michael to pass and secure the win resulted in a global outcry that races were being fixed. The notion of team orders is as old as Grand Prix racing and certainly has existed in Formula 1 since it started in 1950, particularly as from 1950 to 1957 there was no constructors championship and so everything was focused on getting one particular driver to become world champion, unless you were Enzo Ferrari of course, when no driver was allowed to become more famous than his cars (although apparently this philosophy has now changed!).

Some teams, notably Williams, McLaren and more recently, Red Bull Racing, have been very explicit that they do not have team orders, although there are generally agreements between drivers to avoid situations such as those at the Turkish Grand Prix where Webber and Vettel took each other out of the race, and Button and Hamilton very nearly managed a similar feat a few laps later. I have always regarded F1 as a team, rather than an individual sport, it therefore makes sense for some explicit orders to exist so that the team is maximising its performance. After all the only separation, apart from the drivers’ and their entourages, are the dedicated race engineers, the same mechanics do the pitstop no matter which driver it is, the same people design and build both cars – one team with two players. Jean Todt was therefore unrepentant back in 2002, as Ferrari Team Principal, when he received widespread criticism for asking Barrichello to relinquish the lead – it was for the good of the team and that was where his priorities lay. However, lest we forget, F1 is also a spectator sport, and there was no question that Turkey 2010 was one of the most exciting Grand Prix this year because drivers from the same team were genuinely racing each other. So we are left with a typical F1 compromise, no team orders, or rather no team orders that look like team orders. So when Rob Smedley radioed to Massa that ‘Alonso is faster than you, please confirm’ it was clear to anyone with a passing interest in F1 that there was some other meaning here, and when Massa duly let Fernando past it became self-evident what that meaning was.

It is interesting to ponder as to the wording on Fernando’s Ferrari contract, given his experiences at McLaren he was probably very keen to get some explicit commitment to number one status at the Scuderia. I’m not a lawyer, but I wonder if a contract (and I clearly have no knowledge as to whether or not this is the case with Alonso) which effectively applies team orders – ie one driver is explicitly given rights over another – is enforceable in a sport where the rules clearly state the opposite? The FIA has a Contracts Recognition Board, designed to arbitrate in contractual disputes between teams, I wonder whether they also need to be vetting contracts to ensure they comply with FIA regulations? Maybe something for the new President of the FIA – Mr Todt – to consider.

But I’d like to propose a different solution. I have no problem with Ferrari applying team orders – it is a strategic choice that they have made in how they run the team. I believe each team should make an explicit and verifiable statement to the FIA and the public about their approach to team orders, so Ferrari can stop pretending to be doing one thing while clearly doing another. It might be embarrassing for some number 1 and number 2 drivers, but at least the fans will know where they stand and allegations of race fixing would become a thing of the past, imagine that!

Is Force India's talent exodus a sign of on-track success or managerial failings?

The news that Force India’s Technical Director – Mark Smith is leaving to go to Lotus, suggests that all is not well at the Silverstone based firm. This comes very quickly after Mark’s predecessor James Key had left to go to Sauber, there are also a number of other Force India staff leaving to join their previous Technical Director – Mike Gascoyne at Lotus. If you add to this the fact that F1’s most experienced Commerical Director, Ian Philips, also left Force India after a rather public disagreement with Vijay Mallay over who talked to the press, it seems like Force India is experiencing a bit of talent exodus.

So why could this be? Well typically in F1 a good time to move is when your team is doing well and you can reap the benefit from being associated with a successful team, although Force India are certainly not a front runner they have, over the last couple of years, produced a few surprises with their car and are currently well ahead of Williams in the midfield battle. However such a mass exodus of technical people is unusual and suggests that all may not be well in the management side of things. Talented technical people are motivated by working with other good technical people and being given the freedom to test out theories and ideas. They also look to work with and be managed by those who have a strong technical reputation and thereby benefit in terms of professional kudos. The benefit to Red Bull in hiring Adrian Newey was not just in getting the skills and capabilities of Newey, but the fact that he was there was a powerful signal that said the team plan to invest in technology, furthermore if you come to Red Bull you will be working with one of the all time greats, suddenly Red Bull Racing’s attractiveness to talented technical people went up exponentially, and we are now seeing the results.

Ron Dennis was a past master of recruiting the top technical brains (e.g. John Barnard, Gordon Murray, Adrian Newey) and often managing to keep hold of them by allowing them to work on other interesting projects such as Murray’s work on the road car – this way the talent is not lost to the competition. One of the great strengths of Flavio Briatore (and as we know there were also weaknesses) was that he let his technical people do their thing. He gave them the space and resources to get on with the job. He allowed Benetton and then Renault to build up its technical capability and also brought through some great talents, Mike Gascoyne and Mark Smith among them. Let’s hope that Force India haven’t lost the plot regarding retaining and developing their technical talent.