Lessons from Formula 1 (7-9)

When we interviewed Toto Wolff, MercedesF1 Team Principal in 2015 while preparing the third edition of “Performance at the Limit, Business Lessons from Formula 1 Motor Racing,” he started by saying we had caused a problem for him. A month prior we had sent him a copy of the second edition of the book and in his typically diligent manner, he read it. The problem was that he did so while on holiday at a beach resort with his wife, Susie. He confessed with a smile that she reprimanded him several times for reading our book and not relaxing while sitting in the sun. It was the start of an illuminating and fun discussion. It also contributed to our highlighting the MercedesF1 car on the cover of the new edition.

 I have shared lessons 1-6 from the book in two previous posts. Here are lessons 7, 8, and 9.

1.      Measure everything

Formula 1 is an engineering-based industry. In that context, the delivery of the key product, a fast car, is entirely contingent on design, manufacture and refinement using state-of-the-art software, telemetry, computer capacity, and nowadays, Artificial Intelligence, to measure everything. Measurement takes place at the factory, at the pit wall, and on the track. In addition to the car this includes data about the drivers’ physical condition.

Like all businesses, Formula 1 teams must determine what useful information can be drawn out of the massive amount of data that is captured to make strategic and tactical decisions. Are you measuring the right things? Inputs vs. Outputs? Activity vs. Value-added?

2.      At the edge, not over it

Conflict within an organization can undo all efforts and goodwill that has been built to that point. Given the competitive nature of the individuals in Formula 1 and the fact that they operate within a media fishbowl, it is not uncommon that dirty laundry is aired in public. Toto Wolff faced this when his two drivers, Lewis Hamilton and Nico Rosberg (previously two close friends) competed against one another for the Drivers’ Championship in 2016.  The impact of such a situation can certainly have a negative impact on the team’s culture and performance.

Organizations with strong leadership from the top, based on clearly defined, widely communicated, and role-modeled values, are less prone to finding themselves operating with internal conflict situations that get out of hand.

3.      Maintain open and constant communication

The one concept voiced by virtually all the individuals we interviewed across all three editions of our book was the importance of maintaining an open flow of communication involving everyone in the organization. Communication takes place in all directions, formally and informally, on a small and large scale, in person and virtually.

My favorite quote on the subject, well worth remembering, comes from Sir Peter Ustinov, writer-actor-humanist, “Communication is the art of being understood.”