ANITA ELBERSE: I'm Anita Elberse.
I'm a professor at the Harvard Business School.
And I'm here with Toto Wolff, the team principal
behind the Mercedes team, the team behind, arguably,
one of the greatest winning streaks in all
of sports with eight consecutive team-based championships,
the Constructors Championship.
And we're going to be talking about what it takes
to build a winning culture.
You've shown that you can do that.
But I actually want to start by looking at this season,
because this season the winning streak came to an end.
How did you experience this season?
TOTO WOLFF: Yeah, Anita.
Good to be back.
Actually, remember, we talked about it last February
when it was we were here?
About eight consecutive world championships.
And I said to you, let's hope this is not
the start of us losing.
And here we go, end of the year.
And we've lost that championship.
ANITA ELBERSE: Have you changed your approach?
Were there areas where you said, now,
what we've been doing all this time, we can no longer do?
Or has it been still the same kind of leadership approach?
TOTO WOLFF: Over all these years,
we really tried to work on our values, the culture,
and philosophies how to cope with the day when it comes.
We knew there is no sports team in the world that
has won every single championship that they entered
forever.
So that day has come.
ANITA ELBERSE: Yeah, because you've
talked about this fear of losing all along.
And now losing is actually happening.
How do you cope with that emotionally?
TOTO WOLFF: It comes in quite an interesting pattern,
because at the beginning, you are in disbelief.
This can't possibly be happening.
And then comes the phase where you
think, OK, this is just a blip.
We got things wrong.
This is an organization that has been successful in the past.
And then you realize, we got this really wrong.
And the real risk is that you change your expectations.
And this is where it becomes so fundamental to not change
your own expectations and not say,
well, OK, we've lost that one anyway already.
Or you get used to a podium and you
say, well, it wasn't so bad.
We finished second and third.
And in a way, losing doesn't become as painful anymore
as it was before.
And that's real risky.
And we've lived through this emotion with the team,
finishing fifth and sixth or fourth and fifth.
And suddenly, you end up on the podium
and you think it's a success.
And it's not.
You need to remind yourself how painful it is.
If we would have had a fourth and fifth or third and fourth
last year, that would have been seen as a defeat.
So it's still seen as a defeat.
But you have to remind yourself.
ANITA ELBERSE: To remind yourself
that you can't get used to this not finishing first.
TOTO WOLFF: Yeah.
I think it's how our mind works.
It's almost protecting ourselves from feeling
the own mediocrisy.
And if you're not good enough, suddenly you
score a result that is better than expected,
you're quite happy about it.
But when you scroll back and say,
well, how would we have felt six months ago about such a result,
you come to the realization, this
is not where we expect ourselves to be.
ANITA ELBERSE: Right.
Do you have an explanation by now for what has gone wrong?
TOTO WOLFF: Formula One is physics, not mystics.
And we can almost trace back to the day
we made a decision that sent us on the wrong development path.
In simple terms, it's we continued to develop
the car very low ride heights.
That means on the floor.
And we soon realized, when the car got going,
that we weren't able to run it there.
It's the famous bouncing or [INAUDIBLE]
that everybody was talking to.
So our development direction was simply wrong.
And to unwind that, undo--
you first have to realize, what is it that we got wrong?
Because our tools clearly didn't show us that was a problem.
Why didn't our highly sophisticated instruments not
show us that bouncing was a problem?
And then you start to scientifically undo this.
And it's almost like you're peeling layers of an onion off.
There's one problem you think is the essential one,
and then there is another layer and another layer.
And Formula One is so complex that it takes a while
to actually come down to the ground and say,
this is what we believe has gone wrong.
And then it takes a while to recover.
ANITA ELBERSE: Do you feel everything is in balance again
for next season and your chance to win
is as great as, say, Red Bull's chance to win?
TOTO WOLFF: I believe that we have
the important pillars in place.
We have the right financial structure, the right kit,
the right organization, the good drivers, the right engine.
Hopefully the management is in a good place.
So there is no reason why this team that
has won eight consecutive championships suddenly
took an idiot pill.
That's certainly not the case.
But we can't really predict when we're able to come back
because if another team has been gotten it right straight from
the get-go--
and Ferrari and Red Bull have done that pretty well--
it can take time to literally catch back up
and fight with these guys in the front.
ANITA ELBERSE: I do want to talk a lot more about what
we uncovered when it comes to that winning
streak and the winning culture that you built at Mercedes.
There was the case which was discussed in the classroom
here at Harvard.
There's now also the Harvard Business Review article
that describes some key lessons that are emerging.
When you look at what we've produced
and then also the discussions that you've
had with the students, were there lessons
that emerged stronger for you?
ANITA ELBERSE: I think the opportunity to sit here
with you and you visiting us and the exchange with the students
is always a two-way street because it makes you reflect.
Sometimes you think you have the answers,
but challenged by the right questions, actually.
You come to conclusions that you wouldn't have otherwise had.
And that student, I remember exactly well.
He wasn't very friendly with his question.
He said, "Let's see how he reacts, whether he sticks
to his values and all the things that you
wrote on the blackboard when it goes wrong."
And I think that has stayed in my mind until today.
ANITA ELBERSE: Yeah, there was also
some talk about being a micromanager and this attention
for detail.
That is all fine when we're winning.
But the moment the team starts to lose, then
maybe that leadership style is not well received.
Is there anything like that happened this season,
or was it still well received?
TOTO WOLFF: Definitely yes.
And this is the learning on the job.
I think because I'm a control freak, in a way, in the past,
knowing, for me, was enough.
As long as I know what's going on, I can--
mistakes happen.
And that's OK for me, because I see things coming
and I like the exchange and sometimes the argument
within the group to come to the right solutions.
But this time around, at a certain stage,
I wanted to take control back.
And obviously, that is not always great
received by engineers and scientists that
have been working on singular topics for a long time.
But we've talked about it.
At certain stages they were like, OK, back off a bit.
We'll solve this.
And then things struggled and they continue to be a problem.
And at a certain stage, I said, do you
give me the benefit of the doubt that I have reason to question?
Yes.
So OK, this is me questioning here.
This is not meaning that I'm suddenly
micromanaging every detail of, let's say,
the development of the car or the engine.
It's just about understanding where and when
did we got the junction wrong, for me
to comprehend intellectually of how
to avoid that in the future.
ANITA ELBERSE: That makes sense.
Do you feel this last season, has it
made you a different leader?
Or are your employees, the people on your team,
are they experiencing differently as a leader?
TOTO WOLFF: Definitely.
I think that I've changed personally through the process.
I think not always to the better at the beginning,
but you need to realize and look at yourself
and say, actually, I got that wrong.
And self-reflection and introspection
is something that I've always done.
And this year, I got it wrong on several occasions,
and probably to an effect where my control freakishness
and trying to solve it myself annoyed
some of the people that were actually
in charge of the science.
So I will try to, in a way, take the things out of this learning
that I think were good.
But definitely, I will be a different person next year,
different manager.
ANITA ELBERSE: But still a bit of a control freak?
TOTO WOLFF: The control freak is still within me a lot.
The force is big.
But there are certain areas where
I have to just dial myself back a little bit and trust.
ANITA ELBERSE: Great.
When you look back at this season and the way
it has unfolded, obviously the article
describes six leadership lessons that are emerging from it.
But is there now another lesson, one key lesson
when you look back at this last season, where
you say, well, this is now becoming
part of the arsenal of approaches that I have?
TOTO WOLFF: Remember, we have talked about the sentence,
"The days we lose are the days that our competitors
will regret the most, because these
are the days we will learn?"
And in the past, in the last 10 years,
we were talking about that phenomenon about the race
weekend, or a spell of races where it gone wrong,
and suddenly everything made sense and we learned
and the car was fast again.
Now here, we are talking season almost finished
and we haven't won a single race.
So it's been making us tougher all year long because you
need to cope not only with a blip of a race,
but you need to cope with a season that has actually
gone wrong.
And I'm sure that this will give us extra power for the years
to come.
The learnings that we will have, how
we've undone the various layers of development that
have gone wrong, the support within the team that we have--
there is no risk of a job being made redundant.
We have demonstrated that there's
a safety in our organization, contrary to many other teams
that have done that in the past.
And from there, we will rise again.
And this will make us overall much stronger.
ANITA ELBERSE: Great.
Wonderful.
Well, thank you so much for taking the time
to speak with me.
TOTO WOLFF: Thank you.