Formula 1 and The Future of Manufacturing: Adapt, Innovate and Thrive

Peter Van Manen sees a lot of similarities between motorsport and the wider manufacturing industry. “One of the things that we find in motorsport is dealing with change is something that happens every day,” he explains. “We have a changing car. We have different tracks every couple of weeks. We have changing regulations, sometimes every year, sometimes every few years. And we have competitors who have different ways of attacking the rules and making their cars go faster.” 

In Van Manen’s eyes, manufacturers face similar challenges and have had their own changes to navigate: technological; political; financial; and environmental. In recent years, they’ve had to confront supply chain disruptions, talent shortages, and economic uncertainty. 

For Van Manen, success depends on a team’s ability to manage that change alongside risk and time. “In Formula 1, a successful team is one that can manage change and risk in a meaningful time. And that generally is about managing the technology, managing the people, managing the finances, and managing the execution.”

Formula 1 has a global audience of 500 million people who watch it every year. As Van Manen points out, “if you want feedback about what you're doing, it's good to have 15% of the world’s population watching you every couple of weeks.”

Innovation under pressure

What does it take to succeed in such an unforgiving environment? According to Van Manen, “you need a lot of innovation because you are evolving the car throughout the year. And you need very good execution. It’s not just about having ideas; it’s putting them into play, seeing it through, and making sure that it’s consistent,” he said. “I used to tell our team when we were developing stuff for Formula 1 to be mindful of the fact that the world is going to be watching this. But don’t feel the pressure. Just perform.”

Formula 1 teams, like McLaren, start making a new car in May each year. Typically, it takes nine months to develop, and is ready in February the following year before the racing season begins in March. Then throughout the season, Van Manen explains, “we're making upgrades to learn from what our competitors are doing, which we call innovation, some might call copying or borrowing with pride.” 

From a manufacturing perspective, the top teams make about 3,000 new components every week throughout the year. “Now, that is a continuous, relentless churn,” Van Manen reflects. “Many of those parts see the car; some of them don't. Many of them make the cars go faster; some of them don't. The whole idea in motor racing is you're trying to reduce lap time, improve the reliability of the car, and maintain or gain a sustainable advantage.” 

Adapting to change

In 2006 the world changed for Van Manen when McLaren Electronics won the contract to provide Electronic Control Units (ECU) to the rest of the teams in Formula 1. This followed a decision by the governing body for world motorsport, the FIA, to standardise ECUs across all teams.

The ECU controls all the electrical elements of the car, as well as the engine and the gearbox. Van Manen recalls the moment he found out they had won the contract. “On 5 June, I got a call from the McLaren Racing CEO, Martin Whitmarsh. And he said, "Congratulations, Peter, on winning the standard ECU business." I used an expletive because I thought he was joking. And after a little while, he managed to convince me it was serious.” 

Van Manen describes how he felt at that moment. “Excitement of winning a really huge contract that could make a big impact on our business, and the fear of winning a contract that would absolutely change it. I've heard fear defined as something which is sudden, surprising, and threatening. If you have any of those two, it makes you fearful. We had all of those on the 5 June.”

Van Manen and his team had just 21 months before the first race of the 2008 season and in that time they would have to deliver ECUs to all of the teams and engine makers in Formula 1, many of whom they hadn’t worked with before. It gave the team a laser focus, according to Van Manen. “The message was very clear, don't hang around when the end date is fixed. All the people who watch Formula 1 know that the first race happens whether you get there or not.” 

The other thing that was clear to Van Manen early on was that his team needed a sense of purpose. “Everyone had to know exactly what we were trying to achieve. There was a mountain biking quote from many years ago which said, "Strong, light, cheap. Pick two." For us, time was non-negotiable. Quality was non-negotiable. So whatever it cost to be able to deliver, we had to invest. Happily, we invested less than we made.”

The four key elements of successful manufacturing   

Each ECU is made up of 12 different printed circuit boards, across which there are roughly 5,000 components and over 20,000 solder joints. Each season the ECUs run around 5000 race miles. If just one solder joint breaks, it can stop the race car. “Even small failures can have dire consequences,” explains Van Manen. “It can have a huge impact on a championship. It can have a huge impact on the finances of a team.” 

Incredibly, between the time that Van Manen joined McLaren in 1993 and when he left in 2015, there were only three race failures because of electronics. Van Manen put’s the team’s success down to four key elements: maintaining quality and consistency; engaging with customers; making suppliers part of the team; and recruiting and training people.

Looking back on what his team achieved, Van Manen says “one of the big things that we found over many years, but certainly with the standard ECUs, was the importance of looking after the customers and looking after the suppliers. That made successful manufacturing.”

On the customer side, a lot of effort went into building relationships with teams that had until recently been competitors. “We had a few hiccups early on because some of these teams we had never worked with before,” shares Van Manen. “They were all competing against each other, and there were relationships between teams which sometimes weren’t great. We had to show them that they were part of the team delivering the standard ECU. Ultimately, it's not just about introducing something which is new in terms of technology. It's changing the way people work. It's changing the way they deal with each other, how they deal with supplies, and all of that had to be managed in a very short time.”

As well as developing relationships outside of the organisation, Van Manen had to develop his team internally; recruiting new members, helping them acquire new skills, and instilling in them the belief that they could succeed. “When you're doing something that is very new and very big, people are excited, but they also get scared sometimes. An important part of managing that is being able to say to them, "Look, we're good enough for this. We're going to deliver. Don't worry about it. It'll be okay." None of us had ever contemplated, or won, a sort of monopoly business like this before and so it was new to all of us. But it was important for the people who were developing and building the system to be able to look around them and say, "Yeah, we can do this."

Using data to improve performance 

Outside of supplying the ECUs, when it comes to a Formula 1 car’s performance on the track, data plays an important role and one that has grown over recent years. High-speed telemetry – the automatic measurement and wireless transmission of data from remote sources – is something the McLaren team started using back in 1993. The technology has evolved a lot in the last thirty years and now during a race, each car sends around 2 billion numbers. While that may not seem like a lot of data, Van Manen is quick to point out “it is if you’re making decisions within a second!” 

In motorsport, the use of telemetry and combining real-time data with the context around you, can be the difference between winning and losing, he goes on to say. “If you watch a Formula 1 race, and the commentators are talking endlessly about undercuts and overcuts and undercuts some more, and they're talking about pit stops, essentially, what they're saying is, "How do the race engineers decide, based on the data in front of them, when is the right time to change a tyre? When is the right time to bring the car in?" All that is underpinned by data.” 

Van Manen believes the importance of data is something that applies to all manufacturers. Underlining this point, he says “it's no longer about planning for the unpredictable and having a plan B. You need to have a plan D and the data to spot challenges, but also the opportunities.” He also encourages his peers in manufacturing to think broadly about talent. “It’s not just about the talent within your own organisation, and how do we upskill or reskill, but also think about the talent of your customers and your supply chain. How do we actually build strong relationships with customers and our supply chain?”

Unsurprisingly for someone who has spent his career working to keep high-performance cars running smoothly, Van Manen has an antipathy to friction. “It's important with any business - not only to deliver what's important to you for your own business, but also recognise and deliver what's important for the customers. And throughout, working with people to remove the inevitable friction that arises, for blockages that appear, sometimes real, sometimes apparent. When you've got a short amount of time with a lot of change, you can't afford to have too much friction.”