WHY FERRARI’S GAMBLE WAS A SENSELESS, UNNECESSARY, AND STRATEGICALLY WRONG DECISION

by Paolo Aversa

Once again Ferrari, one the wealthiest, most experienced, and most awarded teams took a wrong decision during a critical situation, and paid an outrageously high price for it.

Fact. Alonso nudged Sebastian Vettel’s Red Bull at turn 2 on the opening lap, damaging the Ferrari’s front wing. The team left Alonso out, waiting for the chance to change to dry tyres, but the wing failed completely at the start of lap two, putting the Spaniard out (source: Autosport). Result: since Massa could not do better than 5th place, Ferrari lost its first position in the classification and it is in second position with 40 points (same as Lotus) while Red Bull leads with 66. Concerning the Driver Ranking, Vetter leads with 40 points, while Alonso – only 6th – has gained to date only 18 points. Claudio Domenicali, the number one at Ferrari’s pit wall, takes responsibility for the “unfortunate” decision and says it was a team’s choice not to call Fernando Alonso in to repair a damaged car early in the Malaysian Grand Prix. “We took a risk that didn’t pay off (…) The ‘kiss’ [on Vettel’s car] was unfortunate because we could have taken good points from this race” (source BBC).

Domenicali diplomatically called this decision “unfortunate”. I prefer calling is with its proper name “a gamble: senseless, unnecessary, and strategically wrong.” One might argue that this is the kind of situation that, in case of a lucky strike, a F1 amateur would consider as a brilliant strategic decision. As an academic strategist though, I will try to define why this decision was objectively a hazard, as it was based on wrong basis and scientifically failing reasoning. By explaining this, I will point out the paramount difference between strategy and tactic, and why the former in this case should have been a priority compare to the latter.

Decision making is not a matter of scientific certainties, but still strategists should follow a scientific approach through their analysis and decisions to the best of their possibilities. This means analyzing the available data and not taking the the decision with the most likely positive result, rather than an unlikely decision with the highest possible outcome. It is a fact that, despite the terrific amount of information from telemetry, in F1 there is no way to objectively assess the gravity of crashes on parts of the chassis. The only thing that the people from the pits can do is checking the speed, looking at the videos running on their screens, and trying to figure out how bad the crash was and how long the vehicle could hold. Asking the driver for his sensations might be on the one hand a good decision, but it might be highly misleading too since – as for the front wing – the driver cannot see that section of the car from his seated position. As soon as Alonso hit Vettel it was clearly visible that one front wing pillar was broken and the front wing was dragging along the ground on the left-hand side. There was no way to measure how long that precarious situation would have hold, but even from a semi-layperson standpoint I can affirm it looked pretty bad, and as Ferrari thinking heads had no way to get better measures than this on its resistance. Hence, it would have been the right decision just to tell Alonso to stop and change the front wing as soon as possible. No data means no information, and taking decisions without any proper and reliable measurement is nothing better than gambling. There can be situations – such as the final race of a still unresolved seasonal battle – where strategist might need to go for a “all or nothing” decision in order to finish the season ahead of the rival, but this is not the case of the Malaysia grand prix, the second race of the 2013 season. At this point having Alonso finishing the race and avoiding the risk of scoring a miserable “0” – as he did later  – offer a lot of advantages that needed to be taken into consideration.

First, at the beginning of a season cars are still in development process. Teams know little about their vehicles, and since testing is now capped for all teams, each additional mile raced brings an added value derived from the data the teams collect and the technological insights they can derive from this. Having Ferrari’s best driver out at the second lap is a situation to be avoided at any cost at the beginning of the year. Second, Ferrari has recently proved to be a strong but emotional team, which suffers having to chase competitors’ performances rather than defending a leading position in the ranking. For this reason it is important to keep the gap between Red Bull at a minimum, and thus avoid the psychological pressure for results that negatively affected Ferrari at the end of the last few F1 seasons, thus probably contributing to unsatisfactory results for a team whose ambitious cannot be satisfied with a silver medal.

Finally, leading strategists should have clear in mind that strategies are related to long term results, while tactics are for short term goals. When aiming for a short term result might affect the long term achievement, leaders should know that strategy needs to be prioritized, as tactic might create myopic behaviors, and ultimately failure. I agree with Gary Anderson from BBC saying that “Ferrari have made a string of strategy errors in the last few years and you have to say there is a wider problem there that needs to be addressed. It wasn’t as if it was a snap decision – it happened at the start and the first lap is nearly two minutes long.” I notice how Ferrari is now minimizing such outrageous mistakes, which I believe makes the decision to replace Chris Dyer as head of race track engineering for his mistake which cost Alonso the 2010 drivers title in favour of Sebastian Vettel look like a scapegoat execution, rather than a serious (and necessary) attempt of honestly assessing Ferrari’s current strategy skills, and working hard for a significant improvement.

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THREE STRATEGY LESSONS FROM THE #F1 GRAN PRIX OF AUSTRALIA 2013

(By Paolo Aversa, Ph.D.)

Last weekend the Australian Grand Prix has officially started the 2013 Formula One season. Raikkonen won the gran prix with an unexpected two stop strategy, while the others main competitors opted for three. After one race, Raikkonen (Lotus) leads the drivers’ world championship with 25 points from Alonso (Ferrari) on 18, Vettel (RedBull) on 15, Massa (Ferrari) on 12, Hamilton (Mercedes) on 10, Webber (RedBull) on 8, Sutil (Force India) on 6, Di Resta (Force India) on 4, Button (McLaren) on 2 and Grosjean (Lotus) on 1. Ferrari leads the constructors’ points with 30 to Lotus’s 26, Red Bull’s 23, Mercedes and Force India’s 10 and McLaren’s 2. It is, of course, far too early to draw any conclusion on what is going to happen in the remaining 18 races. Still, if taken alone, the Australian GP does give us some general lessons – or at least hints – on motorsport strategy we could discuss.

First Lesson: strategy is about consistency. In the end, paraphrasing what Fernando Alonso said, it is more important to have a perfect weekend rather than being the fastest car on track on Sunday race. Success comes from a consistent path of development and results that starts on Thursday and gets its climax on Sunday. One can win one race because of chance, but to win a championship teams need consistency and continuous improvement throughout the season, for both drivers. Also, in causality terms, the best way to be the fastest on Sunday is being consistently performative during the previous days.

Second lesson: strategy is about surprising. After so much talking of the quicker degradation of the new Pirelli tyres, it seemed obvious that there was an opportunity for better grip, and thus developing faster cars compared to 2012. So all the teams – but Lotus – gave for granted that the magic formula was getting car performance to the limit, changing tyres 3 times per race. However, Lotus surprisingly proved that it is possible to reach the highest podium with a fast-but-not-so-fast car if this features a “tyre preserving” set up. Even the lords of speed Alonso and Vettel racing on the renown prancing horse or the red bull could not do much about it. After the surprise of discovering that Lotus can do pretty well changing tyres only twice, I wonder if Ferrari and Red Bull will try to imitate the two stop strategy, of push toward a even faster car.

Third lesson: strategy has different measures of performance. Apart from the unexpected Raikkonen’s fastest lap just before the end, Lotus was on average not the fastest car of the weekend, and the successful results is due to the golden arrow’s two stops strategy, rather than a series of exceptional lap times. “It was the best start we could have had to the season,” said Lotus Team Principal Eric Boullier. “Not only is it a win, but the strategy we chose also worked. Reduced tyre wear was one of the strengths of the car that we inherited from last season and it was useful because during Kimi’s second stint the other cars were starting to challenge a bit more.” (source Bloomberg). Somehow, reliability paid-off more than speed, and Raikkonen’s posted the fastest lap on the second-last circuit, when we could expect his tyres to be pretty much worn out, demonstrates that Lotus has also potential to further improve its average lap time as well. When teams look at performance, speed is not the only – and not even the main – measure to keep under control. Reliability can be a great performance measure, if combined with the right strategy.

These are three lessons I have learned, but I am curious to see what the teams have learned next weekend in Kuala Lumpur, Malaysia.

HOW WILL THE NEW REGULATIONS AFFECT #F1 TEAMS’ STRATEGY IN SEASON 2013?

(by Paolo Aversa, Ph.D)

The Formula One 2013 season is just about to start and – as it always happens at this time of the year – the entire world of fans and experts is wondering how the new regulations will affect the upcoming competitions. I believe that first of all it is important to define whether the new changes will have a significant impact on the cars technology and thus the teams’ strategies. Formula 1 official website provides a quick overview on the major rule changes for year 2013. At a first glance, I agree with what several experts already stated: it won’t be a year of massive change. If compared to other season – as the recent 2009 – the architectural design of the cars and their subpart remains more or less stable. The front wing, load and crash tests updates are fundamentally aimed at increasing the driver’s safety, but won’t impact performance or heavily force the other subcomponents’ re-design. The increase of minimum car weight –  from 640 to 642kg – is an effect of the new Pirelli tyres which are exactly 2kg heavier than the one used in the previous year. Consequently, the weight-distribution requirement has also been revised to minimum figures of 292kg: 343kg front to rear, leaving teams a flexibility of 7kg of ballast to position at their convenience. All in all, definitely not a game-changer. So what’s really interesting to talk about?

I believe two aspects require some (strategic) reflection, as they represent the areas of critical decision making for teams and drivers.

First, the new Pirelli tyres. Pirelli – who is today the one and only tyre supplier for F1 teams – released this year a new 8-type tyres set for F1 cars, which present some change both in new compounds and construction (for more technical specs see the new video Pirelli recently released). The main point is that all the different tyres will be softer than 2012 – which translates into better grip, faster cars, but also quicker tyre degradation, and consequently more pit stops. In recent years pit stop have changed from being a refueling break to becoming incredible overtaking opportunities. Therefore, the enhanced gripping quality of the tyres will probably correspond to an enhanced gripping quality of the show. As Pirelli’s motorsport director Paul Hembery affirmed “Our 2013 range of tyres mixes up the cards once more to help overtaking and ensure two to three pit stops per race.” F1 fans who like strenuous battles with numerous overtaking and race strategy changes will be probably be more than content. As in 2012, we will be able to spot which set of tyres the cars fit thanks to the colored elements on the tyre side. For dry-weather track, 2 sets of high working slick: orange (hard), yellow (soft); for low working range white (medium) and red (supersoft). One tyre for intermediate conditions (green) and for wet weather (blue). As before, each F1 car will have 11 sets of tyres available for the weekend, made up of six sets of the harder and five sets of the softer compound (source: Formula1.com).

The reason why Pirelli was asked to developed softer tyres with better gripping properties is also probably related to the change of rules for the drag reduction system (hereafter DRS). The DRS is a motorsport technology aimed at reducing aerodynamic drag in order to promote overtaking in Formula One. DRS was introduced in the 2011 Formula One season and is an adjustable flap on the rear wing of the car, which opens and closes in response to driver commands. The use of the DRS system is an exception to the rule banning moving parts whose primary purpose is aerodynamic and were introduced in response to the banning F-ducts, as they were not susceptible to enforceable regulation (source: Wikipedia). The DRS helped the drivers exploiting the benefits of the additional acceleration boost provided by the kers. However some major FIA regulation updates will affect the development and use of this device. The active DRS, as well as the Redbull and Mercedes tricky “double-DRS” are now outlawed from races. They can only be used, in limited straights – and only within some specific speed/position conditions – during practice and qualifying days. Still, passive DRS will be allowed through all the race. Passive DRS means that the read flap will be “on” all the time, thus providing an increased speed through all the track, and especially along straights. However, since the main benefits of the DRS are derived from decreasing downforce, cars might experience grip loss and teams might consider them too dangerous to be operated in tracks with several fast-corners. Accordingly, while we can expect that all the teams will implement and use the traditional active DRS during practice and qualification, the use of passive DRS will be highly discretionary during races and not all teams will be likely to have it on the starting grid. The introduction of the passive DRS will push teams to handle an increase in complexity and deciding which of their technological features better fits each of the tracks will get even harder in the upcoming season. As we can expect that tracks with long straights and slow-corners will be preferential for the DRS, there is little understanding of what teams will identify as the threshold to consider DRS as a sufficiently safe solution.

All in all, despite the FIA regulations have not undergone a major update on the technological level, these few changes – tyres and passive DRS – might increase the importance of management team’s decision on the cars’ performance. Strategy is definitely one of the key factors to achieve success in F1, and tt is likely that the major teams will continue increasing the resources dedicated to data processing and analysis, in order to acquire a clearer understanding of the boundary conditions that should drive their decisions, and thus find the right interpretation to the sudden changes that the racing competitions offer.