Most people think competition is something to avoid.
A threat.
A frustration.
A problem to solve.
But some of the greatest breakthroughs in business only happen because someone pushes back hard enough to force improvement.
Comfort rarely creates innovation.
Rivalry often does.
WHAT FORMULA ONE CAN TEACH ENTREPRENEURS
The Business Deal That Created One of the Greatest Rivalries in Motorsport
One of the things I’ve always loved about the world of cars is that behind many of the great machines there are even better stories. Sitting at the Melbourne Grand Prix recently, watching the Ferraris flash past with that distinctive red blur, I found myself thinking about one of the most famous stories in automotive history. It is a story that begins not with racing, but with a business negotiation that went spectacularly wrong.
Back in the early 1960s, Ford was facing a problem. The company was hugely successful selling cars to everyday drivers, but its image felt a little uninspiring compared with the glamorous European manufacturers. Executives at Ford believed the fastest way to change that perception was to win one of the most prestigious races in the world, the 24 Hours of Le Mans. The difficulty was that Ferrari had been dominating that race for years.
Rather than trying to beat Ferrari, Ford initially decided it might be easier to buy them.
Negotiations began in 1963. Ford executives travelled to Italy, lawyers drafted contracts, & for a while it seemed that a deal was very close. The agreement would have given Ford ownership of Ferrari while allowing Enzo Ferrari to continue running the racing team. For Ford it would have been a shortcut into the glamorous world of European motorsport.
Then something unexpected happened.
At the last moment, Enzo Ferrari walked away from the deal.
The reason, according to most accounts, was that he discovered the agreement would give Ford the final say over the racing programme. For Enzo Ferrari, racing was the heart of the company. The idea that someone else could control that part of the business was simply unacceptable.
The negotiations collapsed instantly.
Ford executives were furious.
Henry Ford II reportedly felt personally insulted by the way the deal had fallen apart. Instead of walking away quietly, he decided Ford would build a car capable of beating Ferrari on the track.
What followed became one of the most famous rivalries in motorsport history.
Ford invested enormous resources into developing a new racing car. Engineers worked relentlessly to create a machine that could compete with Ferrari at Le Mans. The result was the Ford GT40, a car designed specifically to challenge Ferrari’s dominance.
The first attempts were not particularly successful. The GT40 struggled with reliability problems & early races ended in disappointment. But Ford continued investing in development, learning from each failure & refining the car.
Finally, in 1966, the effort paid off.
At the 24 Hours of Le Mans that year, Ford achieved a remarkable victory. Three Ford GT40s crossed the finish line together, defeating Ferrari in the race they had dominated for years.
It was more than just a race win.
It was the result of a determination to prove something after a business deal collapsed.
Watching this story unfold from a business perspective is fascinating because it shows how competition can transform organisations. Ford could easily have abandoned the idea of challenging Ferrari after the failed negotiations. Instead, the company chose to respond by pushing its engineering capabilities further than it ever had before.
The rivalry forced both companies to innovate.
Ferrari responded by developing faster & more advanced racing cars. Ford continued improving the GT40 to maintain its competitiveness. The competition between them pushed the technology of racing forward in ways that probably would not have happened otherwise.
Business competition often works in exactly the same way.
It can be uncomfortable to face a strong competitor. Sometimes another company enters the market with a better product or a more compelling offer. It can feel frustrating, even unfair, when someone else seems to be gaining momentum.
But competition can also be incredibly energising.
When organisations face a serious challenger, they are often forced to rethink how they operate. They improve products, strengthen systems & push themselves to levels of performance that might never have been reached in a comfortable environment.
Some of the most innovative breakthroughs in business have emerged because a competitor raised the bar.
The Ford versus Ferrari story illustrates this beautifully. A failed acquisition turned into one of the most famous rivalries in automotive history, & the result was extraordinary innovation on both sides.
Sitting beside the track in Melbourne, watching those modern Formula One cars race past, it is remarkable to think how many technological advancements in motorsport were driven by rivalries like that one.
Competition can be uncomfortable.
But sometimes it is exactly what pushes organisations to achieve things they never thought possible.
Written by Debra Chantry-Taylor, FBA Accredited Family Business Advisor, Certified EOS Implementer & Founder of Business Action.
Business Action is focused on helping Entrepreneurs lead better lives, through creating a better business. We have a small team of accredited family business advisors, EOS Implementers & Leadership coaches, as well as access to a huge range of advisors through our Trusted Partners Network.
