Ron Dennis Is the Steve Jobs of Formula 1, Here Is His Commercial Playbook
Ask anyone to name a visionary leader, Steve Jobs is never far from top-of-mind.
Far fewer, perhaps no one outside of Formula 1, would associate Ron Dennis with such a question, presuming they have even heard of him.
Nevertheless, I find Ron Dennis absolutely fascinating and his contributions to modern motorsport absolutely stand up to Jobs’s contributions to the tech industry.
Ron Dennis had a vision for how F1 teams could be better, and make no mistake, despite his unique ways (at the time) of approaching team management, his approach earned results.
Yes, McLaren went on to become one of F1’s most storied teams, but more pertinently to the business of motorsport, Ron Dennis engineered the commercial and cultural operating system of what a modern F1 team looks like today.
He wasn't just ahead of the curve.
In some areas, he set the curve.
If you're trying to understand how to build a successful motorsports team, especially one that attracts elite sponsors and creates long-term brand value, you need to study Ron Dennis.
Ron Dennis’s way, or the highway
Jobs turned Apple into more than a tech company, and Ron Dennis turned McLaren into more than a racing team.
Dennis understood that F1 wasn’t just about cars, much like Apple wasn’t just about electronics.
If it aims to last, a racing team has to convey emotions even when its cars aren’t moving and to reach this end, Ron Dennis, much like Steve Jobs in his own area of expertise, viewed his F1 team as his domain over which he needed to, and could, exert total control.
Over image, narrative, and money.
Both Jobs and Dennis believed in controlling not only the full consumer experience, Apple with its closed iOS eco-system and McLaren with its in-house development, but also every other experience having to do with their respective brands.
Apple stores and its headquarters are extensions of the product; so is the McLaren Technology Centre.
Perhaps though, it is also the other way around: products that are beautiful must come from beautiful places, surely.
After all, only in such beautiful places can artists and engineers be inspired to design and create meaningful objects.
If this is true, then one must be obsessive about from where products originate if one hopes to end up with obsessively designed outputs.
Surely it was both to Ron Dennis: one avenue out of so many over which to take pleasure in obsessing over every detail, and a practical necessity to ensure that the products at the end of the value chain met his standards, and he actually beat Steve Jobs to bringing his magum-opus to life.
Apple Park opened in 2017.
McLaren's Technology Centre (MTC)?
2004.
Both, interestingly, shaped like circles.
Both designed and controlled in such a way as to convey the values of their respective originators, down to the smallest, most incredibly minute detail.
“Inside [the McLaren Technology Center], the fastidious attention to detail is impressive. Dennis required that the dimensions of the building were adapted to ensure no tiles needed to be cut to fit, including around the heavy machinery equipment.
I learned on my first visit to the MTC that it was imperative none of the old race cars on the Boulevard leaked oil, as a stained tile would necessitate the removal and replacement of all the other floor tiles.”
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In less than 500 words.
Ron Dennis lived to satisfy and attract customers through brand-building
Like Steve Jobs, Ron Dennis believed the product is the brand. Every touchpoint, from the MTC and the cars down to the factory walls, had to convey perfection, or as close to it as possible.
I have to imagine this was just in Ron Dennis’s nature; he just couldn’t imagine any other way of doing this.
Nevertheless, his rigid views were channeled to and in service of a practical outlet: delighting sponsors.
“To many inside motor racing, a sport that liked to think of itself as sexy and dangerous, Dennis’s approach seemed clinical, bland, and nauseatingly corporate. But sponsors absolutely ate it up.”
Too many teams today still think sponsors want exposure. They don’t, at least not in the literal sense.
They don’t want simply to be seen; they want association with a brand.
The logic is obvious: if a fan identifies strongly with an F1 team, and the case is made clearly enough that a sponsor is a sponsor because they share the same qualities (of excellence in engineering, design and build quality, for instance), the fan is more likely to choose that brand over a competitor.
But how many teams actually work to deliver this association?
In any business, you have to have a “North Star” and be uncompromising in service of that destination.
Ron Dennis understood this and made sponsors (his clients) that North Star, and to create association between McLaren and its sponsors he went to great lengths, often ahead of everyone else and always following the money.
The Marlboro-McLaren deal wasn’t just a sponsorship; it was a brand fusion.
In fact, McLaren and F1 as we know it today would not exist were it not for the involvement of that tobacco brand.
According to The Formula, Ron Dennis, in collaboration with Marlboro executive John Hogan, came up with what was straightforwardly called “The Book of Sponsorship,” which, while perhaps little-known today, is at the heart of modern F1 sponsorship practices, because it was this very document that prescribed carving up a race car’s chassis into various zones for optimal sponsorship logo placement.
Furthermore, the MTC wasn’t just a vanity project, or a place to work. Dennis viewed it as part of the advertising budget, the physical manifestation of what McLaren stands for.
This wasn’t just to make the employees feel good and work more efficiently.
Rather, he used the facilities, the pit stops, the team attire, everything that had to do with McLaren, as signals to sponsors.
“ I still have people come up to me, and have done for years, and say we’ve been to your facilities they’re mind-blowing. How do you keep these standards? How do you keep this mindset?
The answer is... attention to detail and by sharing and infecting people with your...passion for perfection, your desire for perfection.
You know, you can’t always be the best, but you can look the best.
You know we might not have the fastest car on the race circuit but you can do the fastest pit stop.
Why not have pride in that?
[Some might say] it’s not going to make a difference, it does make a difference, it does make a difference and [these are] tiny examples of how I think.”
Commercial creativity: Funding innovation with (or without) selling out
Ron Dennis entered racing with an interest in cars, certainly, but that wasn’t his only (or perhaps even his biggest) motivation.
“Enzo Ferrari was drawn to Formula 1 by his love of speed. Colin Chapman saw it as a way to follow his creative mania. But Ron Dennis came to the sport with a very different plan in mind.
He saw an F1 team as a way to make money.
Even in a sport of permanent, self-imposed change, this rethinking of the very purpose of running a Formula 1 team was so radical that it turned a ragtag racing team in a dingy industrial park on the outskirts of London into a billion-dollar business empire.”
This business-first instinct served him well. Even without early, formal boardroom experience, he had a knack for recognizing opportunities and structuring deals (and/or twisting some arms…) to make them happen.
Early on, he turned a driver management deal into team equity and money to keep his dreams going
He was able to pressure Philip Morris into getting McLaren to sell him a stake, while he was still operating his lower-tier “Project 4” team.
He convinced Hercules, an aerospace firm, to build carbon monocoques in exchange for recognition and acknowledgment
If you're trying to fund a motorsports team, or pitch one, this is the playbook:
Don’t wait for prize money. Go get creative. Be relentless. Get what you need without compromising the product because that is the very thing you are selling.
Is McLaren a tech company in disguise?
Ron Dennis baked business thinking into McLaren's DNA, because he understood that achieving racing sustainability could only come from revenues brought in by sponsors. At a time when Formula 1 was not the juggernaut it is today, that mindset was remarkable.
But he took his approach further, because to him, success wasn’t merely about on-track results, about “racing sustainability”.
It was about fulfilling a vision of being an all-encompassing business.
“While other teams came to see the importance of corporate partnerships to their bottom lines, Dennis was exploiting them to accomplish specific strategic objectives”
Those “specific strategic objectives” went beyond just racing, and Ron Dennis constantly sought to package and leverage McLaren’s skills and know-how off-track.
McLaren Applied, originally started as McLaren Composites, now “develops and delivers advanced engineering and technology solutions that enable organisations across motorsport, automotive, transport and beyond to make a difference to their customers and the world around us.”
To the extent that motorsport is a business that just happens to sell cars going around a circuit, teams should take note: all revenue streams are valid and should be on the table.
Ron Dennis had a knack for understanding and monetizing the concept of “core competencies”, and in today’s paradigm of dizzying costs to go racing, this is a practice worth adopting whenever and wherever possible.
Ron Dennis’s legacy: What you still see today
Industry insiders who have long followed F1, or who worked directly with Dennis, often bring up his love of the color grey or the “Ron speak” he employed, full of jargon-heavy words that stood in for simpler concepts.
When Dennis tried to present himself as a businessman in a sport dominated by oilfield roughneck-types, he was ridiculed.
Today’s that’s just business, and the ridicule stopped when the results started coming in.
“They mocked him for bringing his briefcase to the pits and talking about ‘layered management.’
They weren’t laughing when McLaren left them in the dust.”
If one had to summarize Ron Dennis’s contribution to F1, it’s that through his misunderstood quirks, he brought a level of professionalism so deeply embedded that it’s now inseparable from the sport.
Ron Dennis’s way is just the way, “standard operating procedure” in what might have been called Ron-speak decades ago.
Today, there is nothing quirky about obsessively courting sponsors, and while he may have taken flak for trying to run a proper business on-track in the 1980s, what is F1 today if not one of the most corporate, business-driven entertainment organizations on the planet?
Paddock hospitality that looks like luxury retail? That’s Ron Dennis
Team apparel polished for camera and client? That’s Ron Dennis
Clean garages and sparkling lighting? All Ron Dennis
One can only conclude that the Ron Dennis blueprint works, because today, it’s just the way things are done.
Ron Dennis, with all his rigid idiosyncrasies, brought a discipline that was needed to take advantage of the commercial order Bernie Ecclestone was imposing around the same time. They may have butted heads, but each of them needed the other for F1 to become what we enjoy watching today.
On a more personal note, I admire Ron Dennis because he truly made it the old-fashioned way.
He was born in one social sphere and, through sheer determination, hard work, and vision, entered another, far more stratospheric, one.
In a world where success, sporting or otherwise, usually involves so many tales of people using deception or connections to get rich quickly, Ron Dennis’s story is one of the truly encouraging ones.
F1 stands on the shoulders of Ron Dennis, and it will be a very long time before someone has such a transformative impact on the pinnacle of motorsport.
Photo credit: Wikipedia