I dont know how many of you are Formula 1 fans - I doubt if there are any, but theres something interesting going on at Ferrari that is relevant to generally how companies are run. Obviously, youre pretty likely to know what Ferrari is, and a significant amount of their prestige comes from a long history of victory in Formula 1, which is (usually) the pinnacle of motorsport. However, in recent years, theyve been way off the pace. Theyve come close to winning the World Drivers Championship on the back of Fernando Alonso, whos generally been able to take an uncompetitive car further than one might usually expect. But in general, the teams been in really poor form, and lurking midfield at best. This is not what Ferraris accustomed to, and its been interesting to see how theyve reacted. Recently (a few months ago) they had a team meeting and discussed how they were going to turn things around.They said they needed: * Greater efficiency and speed in the time taken to react and in making decisions * A bolder approach to risk-taking This comes back to a theme Ive seen *again and again* in recent years: Its not what you say, its what you do. I know, seems trite, but a lot of times its hard for someone to see that these things are incredibly different. In Ferraris case, consider the following: In 2011, they publicly fired their technical director, Aldo Costa, in response to the uncompetitiveness of the 2011 car. In 2011, they publicly fired their race engineer, Chris Dyer, for a significant error in strategy in the 2011 world championship. In 2014, they publicly fired Stefano Domenicali, the team principal, for the lack of performance of the 2014 car. Also this year, they publicly fired the director of their engine development program, Luca Marmorini, due to the uncompetitiveness of the Ferrari engine, specifically, even though theyd deliberately compromised engine power to reduce the size, in order to aid the cars aerodynamic performance. Later in 2014, the head of Ferrari, Luca di Montezemolo, was publicly fired in an awkward spat between him and Sergio Marchionne about the direction of Ferrari & the F1 teams performance. A few weeks ago, the new team principal, Marco Mattiaci, was publicly fired after only 7 months, most likely because he was responsible for losing their star driver, Fernando Alonso, and also, because Ferrari just finished their worst season in decades. One of the big things here is that these werent quiet team reorganizations that happened behind the scenes. These were gruesome public executions because thats what the company wanted to project. These people were underperforming and so we got rid of them. Look at the things were doing to turn the team around! The problem is, consider again what they said they wanted - greater efficiency & speed in making decisions & a bolder approach to risk-taking. If you know that if you make a decision & the results arent immediate success that youll be publicly humiliated & lose your job, are you going to make bolder decisions or more conservative ones? Are you going to make them faster, or are you going to go to every length to ensure a minimum of potential for failure? What Ferraris *said* they want, and the environment theyve *actually* created are completely at odds with each other. By sacking all these people in public as a show of force, theyve created an environment of fear, which always results in *fewer* risks, and *slower* decisions. Plenty of people try to move fast & break stuff, but unless you actually accept that failure & breaking stuff is an *inevitable* consequence of that philosophy, and you adjust how you respond to failure, treating it as a learning opportunity & a way forward instead of a reason to fire someone, then youre not *actually* embracing the philosophy, youre just talking like you are. To *actually* embrace a culture of speed, you need to react to failure differently. You need to create a culture where people feel safe to experiment & try things that might not work, and you need to understand that its not how many mistakes you make, its how well you learn from them & how well you can respond to ever-changing conditions. This is a deep, complex culture issue, and not something that can be created or changed overnight. With Sebastian Vettel replacing Alonso at Ferrari, personally Id like to see them change their fortunes. But unless they can turn their culture around (which I dont think is likely, because Marchionne is the head of Fiat, and hes been the driving force behind a bunch of the recent firings - hes not going anywhere), nothing significant is going to change, and if other teams have actually embraced the move fast & break stuff culture, Ferrari will be stuck midfield forever.
Posted on: Mon, 01 Dec 2014 18:00:58 +0000
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