Driving Innovation

19 November 2010

The skill and confidence required to compete in Formula One is not restricted to the race track. In many ways, the intense competition is reflected in a number of other industries. Alex Burns, CEO of Williams, talks to Ian Duncan about developing technology, responding to regulations and building partnerships.

1. What is your role in terms of the team's technical innovation and engineering?

In Formula One, technological development is driven quickly and that is particularly the case at Williams F1. A lot of the decision-making processes surrounding the allocation of resources across the various specialist disciplines occur at board level.

2. What is the timescale for putting out a new car?

A car has a life cycle of between 18 months and two years. In late spring we'll start thinking about next season's car as the new regulations firm up. Development will then begin around July or August.

This allows us to go through the design circuit of the vehicle, manufacture it, get it tested the following February and start racing in March. By November, it is a museum piece.

3. How do you try to work continuous development into that process?

During the year, the car is constantly being updated. We bring innovations to most of the races.

Last year we made 126 aerodynamic changes throughout the course of the Grand Prix season. In some cases the innovations may have a life cycle of just a few weeks from concept to deployment. We are at the leading edge of speed of development.

4. How can a CEO ensure that technical people are working at their best?

My role is about making sure that they have the capability and capacity they need: do we have the right combination of test facilities, personnel, manufacturing facilities and techniques? What is special about Williams is the culture that underpins all that. It also has speed of action and thought. That's what drives the pace of innovation and sets us apart.

5. But then the engines are mostly out of your control. Is that right?

They are developed by Cosworth, which is quite limited in what it can do because the engines are homologated for the season. Only some of the accessories around the engine can be changed during the year.

6. What is the reasoning behind that?

It's one of the cost reductions Williams agreed to a few years ago and it has proven very effective. But it does limit the amount of innovation that can be made during the season. Changes are only allowed if there is a liability in the engine, but that rarely occurs. The rule this year is that we are allowed to use eight engines per driver, per racing season.

7. Compared with most industries, the sport is tightly regulated. What kind of relationship do you have with the governing body?

The teams try to agree among themselves as much as possible on regulation changes, which we then recommend to the FIA [F1's governing body]. There is a quite a lot of cooperation, but there is always a little bit of space to gain a small advantage. Every team will try to get a rule change that is to their benefit.

8. What lesson do you think other businesses can take from that?

Essentially, we all work to the same rules, so the challenge is to deploy resources to design a better car than your competitors within exactly the same regulations. And that's where Formula One is a great proxy for innovation in other industries, particularly heavily regulated industries such as financial services or aerospace. Where there is a lot of regulation, a company's only option is to innovate more frequently than its competitors.

9. Have you managed to work well in that process?

We are well placed at the moment. There has been a lot of change in the sport recently to bring in what is called the resource restrictions agreement, which limits the amount of manpower allowed for the development of the cars. That means a lot of the bigger teams have to reduce their budgets and re-size to become much more like us.

10. So, are things looking up for the team?

We're certainly well placed within the sport for the future and that gives us a lot of cause for optimism. The other side of the business is looking forward and considering how we develop the next generation of partnerships to support that.

11. A relationship with sponsors is important across a number of industries, but does the nature of F1 put you in quite a luxurious position?

I think so. Formula One is the single biggest annual global sporting event. That's quite a claim but it's the absolute stand-out choice if you want a worldwide sports marketing platform.

12. Why would you say that is?

We are racing in 18 countries this year, 20 next year and across five continents. We are also technologically the most advanced sport in the world. For anyone who's pushing to acknowledge innovation, or has that as part of their culture, it is a great fit.

13. Are there any specific advantages a particular team can derive?

Williams is one of the most senior teams; it's also one of the most respected and independent. We exist together: we race because our partners assist us to do it. We are focused on giving them the best possible value for money whereas other teams are also marketing their large parent corporations.

14. Do you try to draw on those relationships to get more direct benefits?

It is all about activating the association. If people activate well then they get excellent value for money, but you can get a lot more out of it through proper activation of the programme. We work closely with our partners to help them find ways to do that.

15. So what does that mean in practice?

Accenture, for example, has been our commercial partner for 17 years, but it has also done consulting for us. I've been involved in the decision of where to deploy that resource in order to get the best advantage for the team. Similarly, I work a lot with AT&T, which provides our network infrastructure to connect us from the track to our base in the UK, or wherever we are in the world. Setting up and running that network is important.

16. Do you aim to maintain those relationships over a long period of time?

We tend to enter multi-year arrangements with our partners and a number of them have renewed their sponsorship with us many times. We have a lot of partners that have enjoyed the experience and have renewed because of the value. Then they go on to do their own marketing campaign on the back of the sponsorship.

17. Do you have advertisers who are just interested in buying space on the side of your cars?

It works better when people are looking for more of a partnership. We always encourage a sponsor to be actively involved with us.

18. What value do they get from the relationship?

If the client activates well, then they get excellent value for money from Formula One, especially in regards to TV air time. A lot of the benefit also comes from the activation away from the track.

19. What are you planning for the future?

We're looking at diversifying our income. We recently invested in Williams Hybrid Power, a relatively new company developing flywheel technology that will be used for kinetic energy recovery systems in Formula One but could also be deployed outside of the sport in the transport sector.

20. What pushes the business forward?

Our target is to win the constructors' championship and the drivers' championship. Every year we want to dominate the sport.

Alex Burns was speaking at the launch of the Power Plate pro6.

Williams CEO Alex Burns believes the company is well placed within the sport and is optimistic about the team’s future.