“To coin the phrase from the great Mike Tyson, ‘everyone has a plan until they get punched in the face.’ Having been in Formula One, I’ve been punched rather a lot and didn’t worry me too much,” says Nick Fry, former CEO and co-owner of Mercedes Formula One.

Speaking at the 15th Investor Allstars Awards last night, Fry outlined the biggest lessons he learned in his 40-year career on how to win consistently.

The best people

The reality is that in Formula One, unless you have the likes of Lewis Hamilton or Sebastian Vettel, you won’t consistently win, he says. “These people are worth the $30 million because they will win when others won’t.”

“My view is that CEOs of any company should know who the best people are and build a relationship with them. I can absolutely assure you that in 2013, Lewis Hamilton was not sitting at home waiting for a phone call from Nick Fry.”

“He was gainfully employed by a team that was far more successful than ours at the time. So how did we reach him? We had built a relationship, started four or five years before, even when we weren’t in a position to hire Lewis,” he adds. “The reason that Benz is so successful is that it’s not just that they hire the best drivers. It’s right through the ranks.”

Clear objectives

Fry believes that even though this is a basic element in management, it’s easy to overlook the importance of setting clear objectives. “Have clear objectives, make people accountable to deliver on them, and most important of all, don’t keep interfering! The most annoying thing is when you’re constantly being asked to report on progress. If you hire the right people, you can easily set objectives for them, and leave them to it. Help them when you can, but don’t keep asking dumb questions.”

Great teamwork

In Formula One, you need to engage every single person in the organisation, says Fry.

“The reality is that the person in who is putting together a gearbox with maximum tolerances of a fifth of the width of human hair, just as important as the driver. Engaging with every single person in the team is really important, and that means treating them like human beings, knowing their names, asking how their kids are, is a very important part of the job.”

A great example of teamwork is the famous pit stop in Formula One. Pit stop crew can change tyres in 2.5 to 3 seconds consistently. Fry says this comes from lots and lots of practice as well as the confidence that they can rely on each other to get it done right.

No-blame culture

How do you get people to operate at F1-level efficiency? The superhuman skills of Formula One teams all hinge on one thing, says Fry. They know that if they make a mistake, they’re not going to get blamed for it.

“If you want people to perform at the very highest level, you have to expect that there are going to be problems time to time. The way you react to those problems is going to guide their future behaviour.”

The key thing in Formula One is generating a no-blame culture. Teams take it as a given that every-so-often, things can go pear-shaped. It’s really important not to pass the blame and dwell on that.

Open communication

The key to great teamwork is strong communication. “I sometimes work with Digby Jones, and his tagline is ‘communicate, communicate, communicate.’,” Fry says.

“It’s the Malaysian Grand Prix this weekend, and if you’re lucky enough to be let in next on Monday afternoon or Tuesday morning, you’ll find the whole team of 900 people gathered in a huge room, with management up in front. Even if the team came in first or second, there will be 50 things discussed on what could have been done better, and everyone on team will be there.”

You’re either in the team or you’re not, says Fry. “If you are, regardless of your role within the team, you will be treated with great respect, and be made aware of everything going on at every level so you’ll know how to do better next time.”

Innovation

Everyone is an important part of the team, says Fry, which is a fact that many large organisations forget. He believes that the best ideas can sometimes go unnoticed in big companies because of that.

“The car that won the 2009 Grand Prix was based on one good idea. That idea came from a very, very junior Japanese aerodynamicist who thought of something within the rules which had a fundamental effect on performance.”

In order to incubate the best ideas within teams, Fry takes inspiration from ‘the original Mr Honda’, who had a saying, “go to the place.”

“His belief was if you have a problem, the best way to find the solution is to go the source. That’s the person on the production line, the person in the engineering department; don’t listen to the middle men,” Fry adds.

Diversity

While it’s easy to pay lip service to diversity, Fry believes its business value goes beyond face-value. “Lots of the audiences I speak to are white, male and over 40 years old. But the world doesn’t look like that,” he says.

“Some of the brightest petrochemical engineers in the world work for Petronas, our title sponsor. The majority are young Muslim women. They are sent on six-month to one-year rotations to work with the Mercedes team, and to share their insight.”

Fry notes that diversity underscores performance at every level, including the world’s top drivers. “That’s what the world looks like. If you’re looking to find the best people, you need to draw from a global base.”

Investor Allstars is an awards programme jointly organised by GP Bullhound and GrowthBusiness. The awards, now in its 15th year, celebrate the achievements of the investors and entrepreneurs shaping the future growth and impact of the European digital economy. 

Also see: Planning in the fast lane: what businesses can learn from Formula 1