by Peter Spann
Today I spent the day at the V8 Supercars in Sydney Motorsport Park (Eastern Creek) and it occurred to me there is a lot you can learn about your business plan from motor racing.
I am a recovering rev-head from way back.
It’s not much of an event really – apparently cost $9million to upgrade the track but I couldn’t imagine why we needed it.
Firstly, NSW is struggling financially – it should be the shining star of Australian state economics but it is in the dog house.
My guess is it’s simple jealousy – Victoria has F1, Qld has the Gold Coast thing (what is it now?) AND Townsville so Sydney had to play catch up.
Heaven’s knows there are a LOT of things I could think of that would be a better use of $9million.
What’s worse apparently the event at Homebush costs $40million! If we HAD to have a street race the least we could do is have it somewhere interesting. I have images of cars racing across the Sydney Harbour bridge both directions, down the Cahill Expressway and around the Opera House – now that’d be a spectacle.
While I was watching the cars belt around the track I thought that motor racing is a lot like business (OK, so motor racing IS primarily a business these days but I am referring to the sport).
You have a whole heap of competing businesses all lined up at the start line shiny and new all anticipating success, some with expectations of winning, some of doing their best and others just hoping they’ll survive.
This is the same in business – nobody starts a business thinking they are going to do a crappy job. Everybody starts a business thinking they are going to do well.
The green flag is dropped and all head off hoping their team bolted on the right bits. The first corner looms and too many cars compete for the same space and a crash is almost inevitable.
Too many businesses compete for the same customers and many don’t survive the first corner if they don’t develop a clear, well known and simple to articulate “sustainable competitive advantage“.
What does your business do that means that it can compete in a sustainable way against all comers?
How does it add value, how does it stand out, what makes it appealing to the right customers, with the right amount to spend with the right desire to spend it?
Then those that survive the first lap set about their race plan – that is presuming they have one – some just seem to careen about the track hoping not to hit the wall.
Now, I’ve never been one for long, highly documented business plans. I find them restricting but I have found that many people who are critical to my success need them…
My Managers – it helps them define what the company is all about and their role in it, as well as setting the parameters for budgets and targets.
My Board need them to quickly get their heads around how they monitor my performance and add value themselves as well as areas of risk we need to address.
My Bankers need them for very similar reasons.
So I have embraced the discipline of a good business plan – every business going places needs one.
So the race plan is set and everything is going swimmingly – you as the driver have settled in, you’re getting faster as you get used to the track, you’re keeping on the tail of your competitors waiting for an opportunity to overtake if one is presented, you’re watching your lap times, speed, gear change points, revs, and other vitals (Key Performance Indicators), and you’re moving ahead.
This is the visionary part of being a CEO – the part where you’re on your own. You’ll probably have a Team Manager (formal or advisory board) egging you on, you’ll have people helping (like the engineers in the pits monitoring telemetry from the car and giving you feedback on performance) and you’ll have a bevy of workers beavering away behind the scenes getting ready to do their bit.
This is the fun part of business – when things get into a rhythm, when things are going well, when the car is circulating and kicking goals.
Then comes pit time.
Everybody needs their race car and business serviced – new equipment gives a performance edge, refuelling the tanks, team and business plan gives the energy to go further and a quick clean of the windscreen helps us clarify our vision. And from time to time something needs to be belted into shape.
I imagine this to be like a team training session, or Management Retreat where we doing our SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis, prepare new plans, and focus the team on them.
Sometimes pit stops go well and our time there is brief, sometimes things go wrong and sometimes people make mistakes.
Then we get back out on the track, circulating and making time. Building up our margins, moving away from our competitors.
Until somebody hits the wall and the safety car is brought out. All that margin is lost, everybody bolts into the pits to refuel and the race plan is thrown out the window. All our team are furiously recreating strategy with thousands of variables on the fly.
So if you want to understand business, just look at V8-Supercars – it might just be more enlightening than you think!
About Peter Spann
Retail | Tourism & Hospitality | Professional Services | Financial Services | Digital On-Line
Emotional Direct Response Copywriter | Blog | Books | Novels | Film Scripts
3 Best Selling Books published by Harper Collins
His goal is to help people make their dreams come true.
His personal interests include travel, boating, aviation, fine art, writing, and film.
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