The Business of Winning
When the Renault F1 Team achieved double world championship victory in 2005, securing both constructors’ and drivers’ crowns, it marked the first time a mass-market automobile manufacturer had won the world championship. That victory was also won with a distinctive approach – the team did not have the biggest budget, nor the most employees. In a world commonly seen as one where money can buy success, victory bucked the trend.
Renault’s victory marked the culmination of a philosophy that was inaugurated in 2000, when the company purchased the Benetton Formula Team to prepare for its works return to the sport in 2002. A philosophy characterised by efficient spending, adaptability, the belief in talent and a significant return on investment, that took the team to the pinnacle of world motorsport.
“Formula 1 is a unique sport,” explains Managing Director Flavio Briatore. “We have a special product: technology, lifestyle and passion. If you win the championship, it is because you have the technology. But it must be a little about show-business. That is what Renault has done – we have a strong personality for the team, and built beneath it a highly qualified group of people, and strong technology.”
Flavio Briatore makes no pretence of understanding every element of the advanced technology Formula 1 relies upon, and helps develop. Indeed, when he arrived in the paddock in 1998, in the midst of what insiders call ‘the Piranha Club’, he didn’t know anything about the sport. Pitted against rivals who had built their teams from humble beginnings, the Italian set to transform the perceived weakness into a strength.
“I always believe that if you come in from the outside, you can see things that other people don’t see,” he explains. “A Formula One team is like any other company. You need to make sure you have the right structure, and the right product. That product is the car and the engine together. But I don’t think the product makes any difference if you are managing the company well. A good manager can translate and adapt his abilities to any business.”
Formula One represents a formidable high-technology platform, as teams explore the boundaries of chemical and physical performance: engines running at over 19,000 rpm and cars literally ‘flying on the ground’. Yet that challenge means nothing without the human factor, for it is not technology, but how people use that technology, that makes the difference between winning and losing. In a sport where tightly-policed regulations dictate how much of the car must be made, and to what dimensions, the secret to success lies in people and organisations.
“Success is about people,” continues Briatore. “There is not one person that makes the company do well, or do badly. A team has a heart, and when those people understand their objective, and they are in the right structure, then they work well. So you need decisive leadership. Managers explain why decisions have been taken, and then make sure they are implemented quickly, to continue moving forward. A driver is the last act in that play, because he interprets and delivers everybody else’s work on the track.”
What’s more, at Renault, the heart of that structure is built much like the cars they spend their time designing: as light, and taut, as possible. The team is a lean, dynamic enterprise – a philosophy that leaves each individual with no place to hide, but ensures each talent is exploited to its full. The focus is simple: efficiency. Which also translates to spending, where the Renault F1 Team is listed by paddock observers as having just the fifth-highest budget on the grid. First position performance, for fifth-position spending.
What is the secret?
“It is about efficiency,” explains Briatore. “These things come from the top of the company. We invest every penny in the business, and how we manage our departments. But it is also about how we operate. We know you have to prioritise, and make the right decisions. If you have an unlimited budget, it can be like going into a restaurant where the menu is fantastic. So you have a bit of that, of bit of this, and you end up with nothing. The way we work, is like going shopping. You know what you want for dinner. So you go any buy the ingredients, and the result is what you want. That is because you have a clear focus, you have made decisions and your effort is efficient.”
However, while achieving a performance differential on the track is essential to building a successful platform for F1 success, it is not the whole story for Briatore:
“Everybody has a car, an engine in the back, and tyres. So what makes the difference between one team and another? It is the personality.”
The Renault F1 Team is not simply an efficient high technology company, but an expression of human dedication, and passion. The personality it conveys is youthful, energetic and dynamic. And the team’s philosophy is to open the sport to a wider public, to bring fans closer to the unique spectacle of Formula 1.
“We don’t live in an ivory tower, and that’s why we have taken our car to Moscow, to Istanbul, to take F1 to the people – and hundreds of thousands have come to watch us,” explains the Italian in a reference to the team’s unique Renault F1 Roadshow programme, which will continue to expand in 2006.
“Formula 1 helps Renault demonstrate performance, reliability and a competitive level of technology, but the company’s values also centre on conviviality and warmth of personality. We try to express that through the team.”
That is reflected in the healthy investment the team continues to attract. “I think we are still a human team,” explains Briatore. “We do a job but we are not pretentious. Our partners want performance on the track and exposure, and we deliver – we had the top two brands for exposure in Formula 1 last year. It is easy to communicate with our team and about us: we are open, there are no filters.”
Consequently, the partnership portfolio ranges from long-standing partnerships with Total, whose Elf brand is also the first-fill oil and lubricant for all Renault cars; to partnership with telecommunications brand i-mode, for whom the Renault F1 Team is an important vehicle for building brand awareness as it expands from its Japanese base throughout Europe; to extensive technical partnerships, that include a unique technology collaboration with the Phantom Works divisions of Boeing.
Yet this combination of personality and efficiency would be worth nothing without a final, vital component: success. Investment is not what counts; rather, delivering on investment.
“We are a good investment for sponsors: we spend less, which means we ask for less money than our competitors – but we are winning. In any business, that is a relationship that makes sense,” concludes Briatore.
