Case study: Digital innovation at Ferrari
Trevor Merriden, May 18, 2017
Ferrari's consortium approach to solving its digital challenges has benefitted multiple companies
Ferrari was established 70 years ago in 1947 and is one of the world’s most iconic luxury car brands. Throughout its history it has been heavily involved in motor racing, especially in Formula One where it is the most successful racing team.
Enzo Ferrari, the business’s founder, once said: “Ferrari does not sell cars, Ferrari sells dreams.” The firm’s big challenge has been to keep this dream alive in the digital era, managing its employer as well as customer brand.
Approaching its 70th anniversary there were a number of business challenges looming large. In particular, how could Ferrari prepare employees for a future where the only certainty seemed to be uncertainty and disruption? And how could it turn the digital environment to its advantage? As Dennis De Munck, HR director at Ferrari, puts it: “Ferrari is a very curious organisation. We want to learn from the best people and the best practice to receive their recommendations and insights into what is happening in the rest of the world.” To satisfy this curiosity the ‘Digital Futures: Winning amidst Disruption’ programme was born.
Ferrari chose Ashridge (part of Hult Business School), an institution with a track record in experiential applied learning, to help it find a way forward. Two things quickly became clear. Firstly: innovation and new ideas need stimulation and fresh thinking from a diverse mix of outside corporations and not just from existing Ferrari employees. Secondly: as the new digital world touches every function and hierarchy, any collaborative approach between businesses would need an equally diverse range of experiences from tech disruptors, thought provocateurs and future Millennial customers, as well as senior executives.
The concept of a ‘live’ Ferrari digital challenge emerged, with the establishment of a consortium community to share knowledge, experience, failures and solutions at its heart. But Ferrari did not know whether other businesses would even want to work on its digital challenges and be open to sharing their own challenges and best practices. Getting the first pilot off the ground was not easy and involved in-depth scoping conversations with potential collaborators.
Ferrari launched the first pilot in June 2016 with 15 participants. After the first pilot module the process was redesigned to allow external participants’ firms to also bring their own digital challenges ‘live’ into the programme. Businesses as diverse as Puma, Unilever, Uber, Tiffany & Co, Deutsche Telekom, Merck and Coca-Cola became involved in working on innovative new digital futures for other businesses as well as their own. A second cohort with 20 participants was followed by a third in October 2016 with 25. Another programme is due in October 2017.
A consistent thread running through the programme has been challenging self-limiting biases and assumptions among the employees from Ferrari and elsewhere on what the future may hold – including the sheer speed and scale of disruption. Tanja Levine, director at Ashridge Executive Education, says that what mattered for success was the “new type of thinking we instilled, how it enabled Ferrari and other participating firms to… have the spark to propel businesses to their next growth curve.”
Other important features have included the way in which the collective brainpower of the consortium group was used, through sharing failures and barriers (and not just success stories) and the use of the programme’s virtual team collaboration space, before, during and after the programme. The programme itself was developed in a highly experiential manner including using simulated and ‘live’ case study challenges. The cohort was split into competing teams that presented their digital innovation ideas at the end of the programme in front of a joint Ferrari and Ashridge jury.
A further recent initiative involved using high-performing Millennial students from Ashridge degree programmes as an add-on resource for ‘real-time research’ at international scale. The latter asked its students to help innovative ideas from those on the programme progress through go-to-market recommendations and customer focus groups.
Prior to the programme the then-virtual participants were introduced and bonded through the virtual learning platform, partly through fast-learning sessions, blogs and discussions, and the initial scoping of Ferrari’s and participants’ ‘live’ digital challenges.
During the programme itself, a sense of urgency was created, including the latest trends and insights from experts in Silicon Valley and China; experiential ‘what if?’ sessions that challenged ingrained biases and assumptions; and insight and feedback from potential future customers. It wasn’t all hard work – the team took the opportunity for some social activities, including offering each participant the chance to drive a Ferrari and team pit stop competitions.
Following the programme, Ashridge offered consultancy and advice as a follow-up opportunity to all participating companies, to help turn ideas into concrete business proposals. And it created an alumni platform to foster an enduring and vibrant digital community.
It’s fair to say the Digital Futures initiative is a highly innovative consortium programme with a strong emphasis on live, immersive and collaborative learning for the benefit both of those working for Ferrari and its partners. Originally conceived for Ferrari alone, it has quickly become synonymous with inter-company collaboration. Ferrari says it has learnt a lot from others. Andrea Mazzanti, the firm’s head of digital, explains: “We not only learnt from the many wonderful innovation ideas that arose for our own digital challenge, but equally if not more from the live digital challenges of other consortium participants.”
The programme now has a consortium group of 20 organisations who have emerged with tangible and measurable ideas to strengthen their businesses. Ferrari’s consortium partners are equally enthusiastic. A senior executive from GM Merck says: “It was amazing to be able to get a hugely diverse team to work on [our] digital case challenge. It yielded many new innovation ideas on how to design and leverage digital innovation and new business models. I took many ideas back home to my team, which we will follow up.”
To reinforce learning in October 2016 the Digital Futures Alumni was established. This enables participants to benefit from shared learning and peer support, remain ‘part of’ the initiative, and continue to drive innovation and change.
In terms of impact and effectiveness, the programme’s net promoter score is at 80 with no detractors, and it has a 4.8 out of five participant satisfaction score. After every cohort participants’ reflections and feedback are assessed, content is redesigned, and a review of the selection criteria for new consortium participants is done.
This initiative has at its core been about partnership and allowing those previously outside to tap into the brainpower of consortium learning. As Ferrari’s De Munck concludes: “We are all incredibly engaged and proud of the initiative. The impact it is having not just on learning outcomes but also measurable commercial innovation is beyond our expectations.”