F1: Ferrari (NYSE:RACE) Management Turns to ‘Harmony’

F1: Ferrari (NYSE:RACE) Management Turns to ‘Harmony’

The new Ferrari (NYSE:RACE) team principal, Mattia Binotto, 49 anni, now has the reins of The Scuderia’s F1 program, as he was chosen to replace Maurizio Arrivabene last Monday just 5 weeks before F1’s 1st testing in Barcelona.

Mr. Binotto has taken on the most high-profile management role in motorsport. H inherited the Team that has been unruly, skittish and painfully unaligned last season.

I believe that Ferrari’s decision to go with Mr. Binotto was positive and bold, perhaps it is the best move that have made in recent years.

Mr. Arrivabene’s dismissal in favor of Mr. Binotto represents a new start for the team and 1 that welcomed all around its 1200 members.

Mr. Arrivabene has been the boss since Y 2014, he was the 3rd Ferrari team principal since Jean Todt stepped down at the end of Y 2007. Since then they have won the constructors championship only once, that in Y 2008.

Mr. Arrivabene’s background was as a marketing executive with tobacco company Philip Morris (NYSE:MO), dealing closely with the team through their long commercial relationship.

He was not a racer, but knew the F1 world and was expected to be able to manage it well. His removal reflects failure in that regard as his team proved unable to really challenge MercedesAMG for the past 2 seasons despite having the car to do it.

He was reluctance to deal with the media, often combative and aggressive in style. The atmosphere within the team reflected this in an intimidating, critical culture, intensified by the pressure they were under.

Lead driver an 4X world champion Sebastian Vettel was vocal about his unhappiness with some team decisions, and it became clear that he was not being managed as the champion he is.

The Japanese Grand Prix last year could not have illustrated the contrast with the all-conquering MercedesAMG better. Their team principal, Toto Wolff, who engages with the media with remarkable openness, spoke honestly on the care with which he had to manage Lewis Hamilton and how his team had pulled together to turn their season around.

After a difficult weekend at Spa he revealed he had sent a message to his staff urging them on to greater efforts, stressing teamwork in “analysis, mindset, work ethic, and fun”.

By Suzuka it had made the difference and they were firmly ahead.

Ferrari had already made team order errors in Germany and Italy and after a poor strategy call on tires in qualifying in Japan cost the team, then Mr. Arrivabene turned on his team publickly.

“What happened today is unacceptable,” he said. “I am very angry. It is not the 1st time that these mistakes have occurred. I do not feel like pointing my fingers at someone in particular, but I am very disappointed.” Such vituperative statements should never be in the lexicon of The Scuderia’s philosophy.

The culture MercedesAMG established is working.

Mr. Binotto has the background with Ferrari to instill a similar atmosphere within Ferrari. He has a solid background in engineering with Maranello Outfit. He joined the team in Y 1995 and has since gone through the ranks in a variety of roles. He took over as CTO (chief technical officer), the head of car design in Y 2016 and for the past 2 years Ferrari has been resurgent.

In both Key areas, engine and design, he has proved able to manage teams cohesively and successfully. He has placed trust in his staff, allowing them to think creatively, while ensuring they work collectively for common goals. This positive approach has paid great dividends, there is every reason to believe this can only benefit The Scuderia as a whole.

Ferrari’s F1 team is a complex construction of individuals, it needs to be finely tuned.

Management and motivation is as important as any inspirational drive or racing car design. Where Mr. Arrivabene proved unable to push and shove his team into success, Mr. Binotto, a racer in the Ross Brawn mode, has the credentials to build a Scuderia that wants to race in harmony.

Have a terrific weekend.

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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