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 cant be sold on the open market. Its products dont 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 âol boy race shop.
Actually, its 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. Its a high-tech manufacturing operation and its web site (www.joegibbsracing.com) is better than those of most industrial vendors.
Joe Gibbs Racing has suffered only one engine failure in the last 12 months, and none in a race (knock on wood) this season. Thats 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, dont think F1 has a lock on racing technology. The good âol boys in Huntersville dont 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 instrumentedsensors 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 drivers 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 wont confirm, but my guess is its 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