he way some NASCAR teams operate probable violates all the rules at Harvard Business School. Joe Gibbs Racing, in Huntersville, N.C., spends an incredible amount of money on R&D, tests every component that goes into the race cars in a $2.5 million dollar metrology lab, and has millions of dollars worth of inventory that can’t be sold on the open market. Its products don’t last a year, and all the R&D is in danger of being obsolete by the next race. Yet it is one of the most successful operations in the rapidly growing Nextel Cup NASCAR racing business.
Maybe American industry should emulate the same business model of a NASCAR team. What Joe Gibbs Racing does should be taught in our engineering schools and MBA programs. We can learn a lot from this down-home, good â€˜ol boy race shop.
Actually, it’s not a greasy old “race shop” at all. Joe Gibbs Racing is housed in an ultra-modern, three-story, 135,000 sq. ft. office building with nearly 300 employees. It’s a high-tech manufacturing operation and its web site (www.joegibbsracing.com) is better than those of most industrial vendors.
"We can learn a lot from this down-home, good 'ol boy race shop."
NASCAR racing is big business and requires huge amounts of money. Each driver–Tony Stewart and Bobby Labonte—on the Joe Gibbs team has 20 cars. This includes four cars for each type of race track: road courses, super-speedways, short tracks, medium-size tracks and speedways. Each car has a 780-hp motor that costs more than $50,000 to build and is designed to last one race. The team goes through about 280 engines in a season, and it makes nearly every part for the engines in its own modern machine shop.
Joe Gibbs Racing has suffered only one engine failure in the last 12 months, and none in a race (knock on wood) this season. That’s because every part in the engines and on the cars goes through the metrology lab. There, exotic equipment measures clearances, surface hardness, finish, weight, and every other spec you can imagine.
Joe Gibbs Racing has metrology equipment from Mahr Federal, MSI Viking Gage, and Starrett, all sponsors. They also purchased a $500,000 Primar MX4 coordinate measuring machine, one of only three being used by race shops in the world. The other two are at Ferrari and Williams-BMW, both Formula 1 teams.
By-the-by, don’t think F1 has a lock on racing technology. The good â€˜ol boys in Huntersville don’t take a back seat to anybody when it comes to R&D, quality control, testing, instrumentation, telemetry, and so on. Although those “rolling billboards” may look crude and 1960-ish on the outside, on the inside lurks the most sophisticated racing equipment on the planet.
Testing consumes a huge amount of time and money. Each of the cars is fully instrumented—sensors are everywhere. They monitor everything on the car: temperatures, pressures, stress, strain, acceleration and flow everywhere in the engines, brakes, transmission, drivetrain, and suspension. They also measure the driver’s reactions to any changes, such as in the suspension or shock valving. The data acquisition and telemetry systems measure hundreds of sensors at data rates that rival anything being done in the manufacturing and process control industries. Things happen fast in a race car, and the DAQ system is up to it.
Such sophistication has its price. The cost of a major car sponsorship is in the $10-20 million range. Gibbs won’t confirm, but my guess is it’s a $100 million per year operation. The number of teams capable of operating at that level and winning a NASCAR race is dwindling.
NASCAR is the top dog in the sports entertainment world these days. The marketing geniuses at NASCAR came up with a product that captivates the public, and the five teams that currently rule the roost all use the same techniques to make their winning products.
We could all learn a lesson by watching how companies like Joe Gibbs Racing run their businesses.
Rich Merritt, Senior Technical Editor: email@example.com