What does Motorsports have to do with Business?

So why is a post about racing on our business page?  Because at AACS, our business is built around the lessons learned from 39 years of participating in Motorsports activities.  While many may consider Motorsports a hobby, it is at the core of what we do.  Our team attacks your business development objectives with the same passion we attack turn 1 at Indianapolis (where we went from 28th to 14th after the drop of the green flag).  We have participated at many different levels of Motorsports, from autocrossing, to road rallyes, to track days, ending up wheel-to-wheel racing with the country’s top talents.  And the results speak for themselves; our winning percentage of more than 1 out of every 3 events, with a podium finish almost 70% of the time is almost unheard of in the sport.  So here are the lessons that drive our passion as we work on your Business Development activities, or as I prefer to say “Everything I know about Business, I learned from Racing”.38847466_10215859643754483_7147583612206972928_n

Lesson 1 – Setting Proper and Achievable Goals

The problem with objectives is they are often rooted in dreams.  Reality suffers when a company targets being the headlamp supplier for the Ford F150.  Why?  The obvious reason it is the number one target for lighting companies is because of the size of the opportunity.  While the average headlamp design is produced at around 50,000 sets a year, the F150 is 17 times that size – so a win here can be worth millions and millions of dollars.  But a significant reality comes into play when considering that there are no less than 15 lighting companies that operate in the United States. So the reality is that there is 1 and only 1 winner, and 14 losers.  Which is exactly what happens in a race.

52033719_2513302448743262_2036430302124965888_n

2018 SCCA Runoffs at Sonoma results – qualified 6th to 4th, wrecked back to 8th to Podium

This lesson was taught to me in the early 90s racing at Waterford Hills.  After years of effort we were finally winning races and occasionally setting track records, but I would call myself anything but happy.  If I won the race, I fretted that it was too close or the gap to 2nd place wasn’t enough or because I did not improve on my existing track record.  This all changed over a Saturday evening conversation with my friend Charlie at the track. 20170930_114419 A little background on Charlie.  He had a dream to race and started by coming to the track to help us with our car.  Eventually he bought his own car and raced with us.  There were two key differences between us and Charlie. One was we were front runners and he was mired in the mid-pack.  But the other was more significant, Charlie was happy to be at the race track, all the time, even though he wasn’t winning.  So over a beer I asked him to tell me the secret of his success.  The answer was simple but shocking.  Charlie replied (and I am paraphrasing) “I have a simple set of rules for happiness, if I make it through the weekend without breaking, if I pass someone, and if I am faster than the last time at the track, how can I be anything other than happy“.  I was speechless because it helped me identify that a) we never set or defined the bar for success BEFORE a race weekend, and b) when we did think in terms of success, the expectations were often unrealistic.  Our lack of an identifiable and achievable outcome meant that we would ALWAYS fail.

BSPEC-CHECKS-SUN24This simple conversation still serves as the core business strategy for AACS, even today more than 25 years later.  Many consulting companies are happy to take your money for the work they do as they quote on a hourly basis.  More hours = more dollars.  At AACS, we do not.  We discuss, develop and agree on objectives and outcomes before signing a contract.  The objectives are reasonable in scope and are structured to be easily measurable.  Just like in racing where there can be a huge difference in the objective of winning the race and winning the season championship, short term and long term objectives need to be compared to ensure they are not mutually exclusive and the priority is in the right place. Then we design and develop a plan of action to meet the objectives at a fixed and flat rate.  During the course of the contract we report regularly on our status because we always want to understand where we stand and if we are winning.

Lesson 2 – Backup Plans are Critical

If there is one thing a race track teaches you is the importance of planning and program management.  The race starts at 10am, and you have to be on the grid ready to go at 9:45am.  If you are late, you lose your place in line and start last.  Late enough and you lose your chance to race completely.  It does not matter if you have a broken part, or were not paying attention to the time. or were switching to rain tires.  9:45am is 9:45am – no amount of arguing or protesting will change that.   This lesson comes out clearly in the issue of rain tires.  Racing tires typically have as little tread as possible to provide the maximum amount of rubber on the road in the dry.  This increases traction and lowers lap times.  But rain is their kryptonite.  So we typically have a second set of tires with huge grooves for use in rain.  The issue comes in those areas where the track is damp or those occasions when the rain is coming but not here yet.  How late do you wait before the race to change the tires from dry to rain?  The later the decision, the more likely it will be the correct one.ACS Major 02-2-3-2019 75 (1)

Through the years racers have developed a little trick to wait as long as possible to make the tire choice.  A set of tires can be swapped in a few minutes if a full crew is available, obviously substantially longer if the racer is at the track alone and must change his tires himself before the race.  By definition that time can be halved if only 2 tires need to be changed.  So for those occasions where rain is imminent or potentially will stop soon, racers will put 2 dry tires on one side of the car and 2 rain tires on the other side #racehack.

20190203_145843The process of meeting our jointly-set goals follows the same format.  We are always trying to gather as much market intelligence and data as possible to allow us to make the most accurate decisions possible, like dry or rain tires.  And while we have a plan to achieve the objectives, we are always thinking about backup plans.  In most situations we have them ready and in place before a problem happens.  This is possible not because of our collective-intelligence, but because of our experience.  With over 200 man-years of automotive experience in our core team, most problems are not really “new”, but versions of things we have seen in the past.   In the end our approach and passion is to win, and we will do what is necessary that within reason to achieve.

Lesson 3 – Value is Everything

If there were a trophy for results per dollar in racing, I would have won it every year I raced.  Racing can be expensive, not just from the cost of safety and the cost of going fast, but also from the cost of mistakes and accidents.

PD_0270

Sometimes when someone spins in front of you there is no where to go.

We always found a way to do what others were doing for half the cost, not for any other reason than I started racing seriously about the same time I started having children – and time and money were in short supply.  Some may say that “Necessity is the mother of invention”, but I would argue that it needs to be expanded to say that “Scarcity is the real mother of invention”.My first race car was a Ford Fiesta, and all the go fast parts were made in the UK and rather expensive in the US.  My solution was to learn to fabricate the parts myself using the pictures I found in catalogs as a guide.  Not because I was cheap, but because our budget was fixed, and we would rather fabricate two go-fast parts ourselves than buy one go-fast part from somewhere else.  A great example is springs.  In general the stiffer the springs the lower a car sits and the more flat it corners, both things that improve the speed around corners.  Special stiffer springs for my Fiesta were expensive, more than several hundred dollars a set.  But the Chevrolet Chevette factory front springs were the same diameter, stiffer and longer.  We bought 2 springs for $50, cut them in half to make 4, fabricated a way to secure them in place and broke the track record the first weekend we used them at the track.

930330 Tiger#4

When AACS works for a client we try to approach the contract budget in the same way we handle our own money.  Every problem is approached not just by developing a plan to accomplish the objective, but how many objectives can we accomplish given a limited budget.  In a way it is the key reason companies come to us in the first place, what they ask us to do is achievable by adding headcount.  But it does not make financial sense to add the headcount on the hope the objective is achieved, rather it makes more sense to have a flexible arrangement that can be modified as the need arises.

Lesson 4 – You Can’t Do it Alone

Going back to Lesson 1 above, my happiness wasn’t the only negative with not having proper goals.  It also had a pretty negative impact on the people around me.  The amount of stress and aggravation when things did not go as hoped was inflicted on others, from my family to my crew.  Crew might be the most critical aspect of racing.  Hardly anyone can do it alone.  There are way too many issues to solve, it takes way too much time to solve them all, and in some cases, no matter how smart you are you cannot figure out the solution on your own.  But at our amateur level of racing, there is no chance to have a paid crew.  So how do we function in this environment?  With friends.  A racing buddy put it into perspective earlier this year when I posted a meme about racing on my social media.   The basic premise was racing is about losing money.  Chip replied “Racing is art of turning money into Friendships“.  And it is true.  better racingWhen you develop friendships with the people you work with it improves the performance of everything around you.  Honda Ron is a great example.  When we first met we were competitors and to be honest, I was not very friendly.  All these years later and we might even be called inseparable as he is a critical resource for our clients who want to understand consumer behavior at dealerships.  And Brian, who runs our west coast office, is also a friend I met at the race track.  And the companies we work with are friends too.  Mike and Appalachian Race Tire was our first real partner and they have helped our performance with not just great Hoosier race tires, but sage advice.  The same can be said for David at Carbotech. without whom we would not have gone to the 2017 SCCA Runoffs National Championship. IMG_20170924_180933937_HDR

We are often approached by clients who have invented a new technology or product and wish to break into a new market or customer.  They come to us for assistance because they have had limited success and want  to help speed the process of adoption.  Invariably, the root issue is not that new technologies have a slow burn, but because the customer thinks the solution alone is sufficient to achieve the sales targets.

IMG_20170925_132428941The marketing and roll out plans almost always ignore the people involved, and the fact that customers don’t have a singular common goal, but that everyone involved has different needs.  We do not just develop plans based on our client’s technologies, but work hard to understand the end customer’s individual needs.  We pay attention to everyone’s needs and motivations and in the process we make friends.  A great area to use as an example is appearance-related products.  AACS is design-focused, but normally does not have any designers on staff.  Yet Bruce, a designer at Ford stated AACS “understands what is important to us (as designers) and how to present his products so that we can see the potential benefits they can provide to us.

Lesson 5 – Engagement brings it all Together

If there is one thing I have learned through racing, it is hard.  And hard things typically make people quit.  Yet many of the people I raced with when I started are still racing.  The question is “Why?”  While I cannot say it is the definitive answer, in my opinion it concerns the way Motorsports engages the people involved. On any given weekend  a lot of people spend hard-earned money to head to a race track or other facility to engage in Motorsports.

 

The lesson of engagement comes out in our events.  We design and organize custom events for our clients with the goal of engaging their potential customers in new and exciting ways.  Clients often utilize trade shows to introduce new potential customers to their products.   We find that trade shows are a mixed bag, while it may be the cheapest way to be visible to a large group, for most shows I have attended the top visitors to the booth were competitors, people looking for a job, and people who had nothing to do with the product on display.  To understand how successful they are all you have to do is look at the faces of the people working the booths.

Lesson 6 – Be Grateful and Give Back

In addition to the racers who spend money to race, there are another group of people who make the event happen.  Safety workers, timing and scoring, registration staff, etc are generally unpaid volunteers who give their time to the sport.  Without them we could not do it, or at the very least, we could not afford to do it.  I spent many of my first years involved in Motorsports volunteering in Timing and Scoring and eventually upped my involvement by becoming our region’s newsletter editor. PS If you want to get started with SCCA Volunteering – click here.xlarge

We encourage all of our clients to make their events charity-based whenever possible.  And we follow the same advice with our captive events.

msb2019 - web-528

Designer Night at the Races is a an evening of Competition, Camaraderie and Charity.  Over 70 events have been held since its inception in 2006 and thousands of dollars have been raised for cancer and Alzheimer charities.IMG_9741

Sketchbattle, the Fight Club of Design, is a live design and sketching competition that travels around the country raising money for local charities.MSB2019 - web-223

Conclusion

The Small Business Association (SBA), states that 30% of new businesses fail during the first two years of being open, 50% during the first five years and 66% during the first 10.  AACS was started in the middle of a recession in the basement of an apartment in Clarkston, Michigan.

CLIENTS 2-17-19-page-001We are now working on our 9th year and during that time we have experienced 30% annual growth and now have 12 people on staff with locations in 4 states.  If we can grow our business in the face of overwhelming odds, what can we do with yours?

AACS Logo_FINAL_2color75 90

PS As requested by numerous people, come back next month and we we will discuss how to get started racing on a tight budget – let’s call it doing our part to give back to the community that has given me so much.

About Frank Schwartz

Frank Schwartz is the founder of CarFriend.me and Advanced Automotive Consulting Services, partner in The Middlecott Sketchbattle Experiment and serial entrepeneur. A long time automotive enthusiast, Frank started reading car magazines at the age of 8 and has spent 30+ years working inside the automotive industry. In his spare time Frank races with the Sports Car Club of America, spends time working on his numerous project cars and supports many local charities.
This entry was posted in Fun Stuff, General Information and tagged , , , , . Bookmark the permalink.

1 Response to What does Motorsports have to do with Business?

  1. Marcus Merideth says:

    Very nice article. I always tell people, I have learned more about managing people thru my association with SCCA than I ever will working in the ‘real” world. 🙂

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s