Assessment: Organizational Structure and the Behaviour of People in Ferrari Automobile Corporation
The Ferrari: A Background
The Ferrari S.p.A. is an Italian sports car. The car was manufactured in Maranello and Modena, Italy. It was founded by Ferrari in 1929 as Scuderia Ferrari. The company sponsored drivers and manufactured race cars before1947. Today, the company is producing street legal vehicles as Ferrari S.p.A. and it is the most desirable vehicle to own and drive. It is presumed as the ultimate status symbol of wealth. Its emblem is the prancing horse in front f the automobile.
The company continuously participate in racing specifically in Formula One. The Ferrari reigns supreme from the 1950s to the 70s and the 1990s to 2000s.
After years of financial struggles, Ferrari finally decided to sell the car division to the Fiat group in 1969. The control over the racing division was retained to . He retired in 1988 at the age of 90.
As of 2007, the Fiat group owns 85% of Ferrari. The Mubadala Development Company, a state-owned company in Abu Dhabi, owns 5% and Ferrari, son owns 10% of the total share ( 2007).
The Fiat Chairman and Ferrari President
did , born August 31, 1947, is an Italian businessman, entrepreneur and a graduate of law in in 1971. He was already in Fiat group when, the company bought the car division from Ferrari.
He is also the president of International fair of Bologna and the Luiss or the of the Social Studies. He is a board member of , Pinault/Printemps Redoute (PPR), , Indesit Company, campari and Bologna Soccer. He presided the Maserati company from 1997 to 2005. In May 27, 2003, he was named as the president of Confindustria.
In 1973, the Fiat group moved to Ferrari. He became the assistant of Ferrari and the manager of Scuderia in the following year. The Scuderia Ferrari refers to the division of the Ferrari automobile company concerned with racing. It was also the name for Gestione Sportiva and the racing team (2007).
He was chosen to be the senior manager of Fiat in 1977 after he was promoted out of Ferrari in 1975. He headed all Fiat racing activities. He occupied different position in the Fiat empire in the 1980s. The Fiat Chairman appointed as president of Ferrari in 1991.
After financial struggles of Ferrari from 1970s to 1980s, resurrected the road car business from heavy debts to a more stable profit. He aimed at winning the Formula One World Constructors’ Championship. Under his leadership, the Ferrari Formula One team won in 2000 after 21 years. In 1999, the team also won the constructor’s championship. The last championship of the Ferrari team dated back to 1983 (Refer to Annex 1).
Under a new leadership, the righting to Formula 1 effort materialized, the Schumacher era was triggered and the rivals were turned around. About one-third of Fiat’s worth was the Ferrari/Maserati at approximately .1 billion. The combined Ferrari and Maserati annual production was 8,000 cars and Fiat manufactured approximately 1.7 million vehicles per year.
The Ferrari Today: Design, Structure and Changes
The Ferrari produced vehicles that have maintained its direction. The company had progressively widened its range on a design level and on quality of work produced which will cater to both the customers and the racing team.
The Ferrari President works with as CEO. is responsible for all the major motor sports activities. The position of Director-general is occupied by . The four important positions in Finance and Controlling, Human Resources and General Secretariat, Communication and Global Brand are held by respectively (Refer to Annex 2).
The master plan of the Ferrari company focuses on four major areas which includes the Gestione Industriale, management, offices and services, Gestione Sportiva and circuits. The areas are then subsidivided in specific agendas.
and the Five Personality Factors
In 1991, the Ferrari company encouraged him to go back to the company. He recognized the need of the company for an urgent innovation. He purchased a 348 model and was utterly disappointed with the product. It was the worst product Ferrari had developed.
The product quality improved dramatically. The 348 model became an outstanding car. Under , Ferrari reigned the track from 1999-2004. The winning products were 456 GT, F355, 550 Maranello, 360 Modena, F430 and Enzo.The man’s envisioned a winning team and made it possible. Indeed, was the man behind the Ferrari’s success.
1. Extraversion/Surgency (2006)
has communicated effectively his plans for the company, the people and the future of the cars. His charismatic approach demonstrated by their reputation and status as a leader in racing, manufacturing and car construction.
2. Agreeableness ( 2006)
possesses self-knowledge and pursues lifelong learning. He never stops to educate himself and apply all learnings he acquired. In 2000, he took a mechanical engineering course in U. He then studied Integrated management of Enterprise in foundation CUOA in Vicenza in 2003. He has a managerial engineering from and another in Industrial design from the . Through his learnings, he was able to move from a position to a position from one company to another. He displayed integrity ( 2000) in his works and his colleagues respected him. His subordinates were confident that he is going to make sound decisions for the people of Ferrari and the company itself.
3. Conscientiousness (2006)
was equally active in the operations of the Ferrari’s competition. He realized the efforts of the people behind the winning team aside from himself. He even orchestrated the signing of . The right team dominated the Formula 1 for almost a decade now through his motivations and he never lost his faith in his racers and the team from the smallest to the big bosses.
4. Neuroticism/Emotional Stability ( 2006)
motivated his people and his team. He helped others to succeed. He frequently paid visits to races but he always sat down with the team and discussed matters like what mistakes had been made, what plans are needed and what strategies will make the team more efficient. He constantly reminded the racers of strategies while at foot and the team leaders while on track.
5. Openness to Experience/Intellectual Imaging (2006)
has a vision and he never stopped believing in his team. He made decisions which proved to be providential for the company in the long run. He conceptualized the “Formula Uomo”. The concept transformed the company and its working environment. The facilities was made even better and bigger, ecologically-smart that served as a workshop and ground for constructing cars of the highest technology and quality.
His being risk-taker at heart and his high-spirits had influenced and inspired the people around him to strive more for the company that they lived for and worked so hard for. He was known as the person who never takes his back on challenges. is man of vision and a picture of true leader and a multi-faceted businessman.
Almost a month ago, despite the silly speculations, he said that Ferrari will remain a profitable division of Fiat and that there is no need for developing a cheaper and smaller Ferrari (2007).
His respect for the Ferrari cars, the people behind, the racers and his workers and his co-executives never seized. He did not forget the people who idolize the racers and the cars this is why he conceptualized a synergism between the solid fanbase and the products. The company offered different car accessories and other merchandise. Thus, producing more work for the people of Italy. Experts say that the future of Italian business is in his hand ( 2004).
He was admired by many because of the way that he helped other people succeed just like what he did to racing career. Ferrari and his motor-racing team dominated the Grad Prix seasons since 1999.
Ferrari observed that every dimensions regarding Ferrari broadens under administration. The once family business is not just a large company today but an industry on its own.
Understanding Organizational Behavior
“Perceptions are important because we act base on our interpretation of events. It is a cognitive process which helps individuals select, organize, store, and interpret the stimuli into a meaningful and coherent picture” (Sims, 2002). Such perception influences behaviour within the organization.
always perceives their racers as prized-possessions and treats them with highest respects and this reflects to all his employees. When made a mistake in Australian Grand Prix in 2006, he lent his back on him and appreciated his honesty. He made no secret in his desire to keep and said “he is the biggest champion ( 2006).
“Attitudes are determinants of behaviour since they link with perception, personality and motivation. Experiences are the results of attitudes that influence a person’s response towards other people, objects and situations” ( 2002).
In 2006, despite Schumacher’s engine failure in Japanese Grand Prix, refused to give up the fight even the Ferrari team was ten-point behind with one round remaining in F1. He said “Ferrari knows how to accept being defeated, just as they know how to celebrate victory and it is a day like this that gives us even more determination for the future” (2006).
“Personality may be defined as set of traits, characteristics and predispositions or stable pattern of behaviour, thoughts and emotions. In either way, personality means ways which any person differs from other person and it is very important when it comes to organizational behaviour” (2002).
dedicated the Hungarian Grand prix 2004’s success to Italy’s greatness. He also paid tribute to jean . The team, that he is so proud of, won the Constructors’ championship in six consecutive years (2004).
The Ferrari Culture
The culture of the company is enriched with experiences on active experimentation and research. The car’s engineering and styling meet and create an overall performance of the highest standard. Ferrari always succeeds and that is because of the clients, fans and enthusiasts. It is more than just cars, engines, chassis and victories — it is a legend (, 2007)
The Ferrari wins a place in history and the legend of racing. The Ferrari circulates in eyeing for talent and the ability to exploit such talent like that of . They bring the car’s components into a greater sophistication. The Ferrari organization is ‘very neat and has a clear division between the road and the racing cars’. Even in the competition department, there is an evident division between Formula cars and sports cars.
The people in Ferrari, practically, talks about cars and discuss ideas. The knowledge, brilliance and intelligence of Enzo Ferrari still linger within the company. The employees live under the fear of making a mistake for it will ruin 64 years of name and reputation. They are unsparing especially for the slightest errors which might damage the drivability of their road cars ( 2007).
The Ferrari and his people are still the masters of their craft. The people pay attention to details from the drawing board to the race cars on the circuits. As such, no other automobile has surpasses the achievement of Ferrari and
However, feudal approach is a direct opposite of charismatic one. During time, engineers and other workers had walked-out and department heads were ousted but his abilities in picking talent and motivating it endured. and similarity is their ability to encourage their people to work harder for the company’s sake.
The Ferrari still lives under legacy but is the one who really push the efforts.
Ferrari and its Organizational Changes: Mechanistic or Organic?
vision extended beyond roads and race tracks. He created an entirely new working environment where the “people is at the centre of innovation”. The firm began to use architecture as a source of brand identity. Then, came a new machining department, a paint shop, a product-development centre and other structures. Each department was created distinctly in effort to provide its employees an ideal working environment.
The Gestione Industriale is compose of foundry, Nuova Officina Meccanica, engine mounting, new paintshop, experience, car servicing, galerria del vento and chassis and aluminun assembly. The foundry is the place where the engines were built and processed. The services of the foundry include the fusion and thermal treatments. The Nuova Meccanica (the new plant) manufactures cars for Maserati and Ferrari. The plant deals with the innovation of the engine parts of the cars produced. In the engine department, the engines are run and tested, mounted on the cars and provides a detailed issue of assembly certificate. The Nuova Verniciatura is a technologically-advanced site where gran turismo cars’ body are painted. The Reparto Esperienze apportions the construction of prototypes and new cars. The department also performs tests on the function of groups and components of the chassis, engine, body and transmission. The job of he servicing department is to check and recheck the cars before it was delivered to the customer to make sure that the car is in perfect condition after the test drives. The Galleria del vento protects the wide range of wind tunnels and its disposal for testing road-going cars. The second Ferrari production plant houses the construction of chassis and the body works (Ferrari World).
A component of the management, offices and services agenda is the Presidenza or the President’s Building. The latest building constructed is the Centre for Product Development serves as a ground for designing and rationalizing production processes. The offices are not found n a single-site so that it can service the people from different places at the same time. The Galleria Ferrari is an extension of service of the company where the history and the exhibition of the rarest but existing Prancing Horse cars can be viewed publicly. The plan is to add 800 square metres for a two-storey structure (Ferrari World).
The Gestione Sportiva is sectioned into three main buildings where different departments reside. The central building maintains the department works regarding Formula 1. These departments are General management, Direzione Sportiva, Logistica, Controllo di Gestione, Human Resources, Sponsor Board, Purchasing Office and Information Systems. The Chassis and Engine Departments are also in the building along with the planning offices and technical staff. On the second building, the residents are the Engine Assembly, Transmission Department and the Hydraulics and Car Mounting Departments. The engines underdevelopment and the testing of the newly-assembled cars can be found on the third building. The composites area constructs the monococque, the bodywork, the production of carbon fire components and the creation of new aerodynamics. The GES Meccanica team produces all the mechanical parts of chassis and engine for race cars. The New Logistica manages the transfers of the Formula 1 cars and equipment trucks and the GES team’s needs for the race competitions. The F1 Wind Tunnel simulates the conditions of the F1 cars on the track. It is equipped with the most modern systems of data collection (Ferrari World).
The Fiorano circuit features the closed-circuit television system, telemetry and chronograph. It is used in testing Ferrari F1 single-seater cars, GT cars and Maserati since 1972 with a total length of 2, 976.41 metres. The range of curves in Fiorano circuit is a severe factor in testing the capability of car chassis. The Mugello circuit serves as an ideal testing ground for racers and is one of the finest circuits in the world. The Ferrari Scuderia adopted and renovated the track field. They updated the buildings, the track and the test and racing facilities.
The Ferrari company is an example of a mechanistic organisation. Its structure is rather complicated because it deals with a lot of departments. Though, the activities are group-specific but still practically impossible to determine its hierarchy. The differentiation of tasks and departmentalisation are given the highest regards but will still create confusion to those people who are outside the company. However, this kind of structure works well for Ferrari for the specialisation and distinction of its department are recognized. The strategic grouping proves to be very efficient for the company. The roles of each are clearly identified and detailed which shows a practice-driven organization (Galbraith, 1973).
On the other hand, the location of authority may blur within the perception of its workers and employees. The position of is clear but the department heads’ are not. The knowledge is centred at the top of the hierarchy which tends to produce a vertical interaction between superior and subordinates. The communication contents are more directive and orders, though, the loyalty is for the organisation a as whole. The orientation of the members is conducted through means but the prestige is from organisational position (1973).
Ferrari and its Top Competitors
There is a total of 9 competitors for Ferrari, The top three competitors for Ferrari are BMW (), Lamborghini and Porshe. The BMW is one of Europe’s top automakers. BMW’s car offerings are sedans, coupes, convertibles and sport wagons. It is a public corporation with fiscal year-end as December. In 2006, BMW sales reached , 644.4 million and net income reported with ,791.7 million. Its sales grew at 17.015. It has a total employee of 106, 575 with 0.7% growth (Hoovers, Inc., 2007).
The Automobili Lambhorghini Holding S.p.A. is a subsidiary company. It is famous for making sleek and expensive cars since it cater to elite consumers. It has a top speed of over 200 mph. On the other hand, the Porsche AG is a public company which specializes in designing autos. Its line-up includes the Boxter, the 911models, the Cayenne SUV and the new Cayman S two-seater coupe. It also offers watches, luggages and tennis rackets. The company also offers consulting services regarding auto and furniture manufacturing, mechanical and electronic engineering and construction (2007).
The Ferrari is offering a lot of services that are being offered by its competitors. Though, the number of employees is relatively small compared to that of BMWs. However, the company is also engaged in synergism. The Ferrari offers books, notebooks, pens and other merchandise to complement the needs and desires of its fan, clients and customers. The company offers a wide array of choice road-cars that are tested and guaranteed high standards and quality. Aside from this, the Ferrari has a gallery, a store, a club and a website among others. Such added features can not be found in a competitor or the competitor’s features combined. This serves as an asset for the company.
Conclusion
Ferrari: Yesterday, Today and Tomorrow
Ferrari’s approach created an environment of intrigue because of , wife. The feudal factory was altercated and loyalties were divided. Ferrari fired everybody at one point but the situation did not weaken the man’s perception. The golden years were yet to come.
The Ferrari won victories in sports-racing machines and various construction competitions between 1962 and 1965. The production doubled over four years and the cars were gradually establishing their status as the world’s best high performance sports. In the early 1960s, the international racing success was equated with Ferrari.
Basically, the success story of the company faced with different challenges. The debt-lade, struggling Ferrari was eventually sold to the Fiat group. They sought the need of a specialist. In di Montezemolo hands, the company was saved and regained its stature. Then the solid and stable success followed.
The newly-posted CEO welcomed in 2006, while, the Ferrari completed the renovation of its road-car portfolio. The cars were unaltered but it retained the different shock-absorber features of the cars.
In 2005, Ferrari sold 5, 409 road cars worldwide. The most important market was, and still is, the North America. Exactly 1,550 cars were retailed and marked the 13th consecutive year-end sales. The leading car models were a Spider version of F430 and the 612 Scaglieti. The Ferrari earned 0 million for calendar year 2005. In 2006, the company sold a total of 5, 671 road-cars with a profit of 8 million. The year-end employment reached to 2,870.
Experts and car enthusiast believed that the Ferrari company will produced more cars and increase their profits only better. Their complete facilities and the knowledge of the people will still be their strength. They even believed that without an Ferrari and a , all of these would have not been possible.
Recommendations
No Ferrari was ever purchased because of its reliability instead, the ownership is a fulfilment of a dream. The sentiment is recognized by the people behind Ferrari even more by . The relationship marketing must be extended to the owner, fans, workers and enthusiasts that it is more than just a car. It is a car that you can use in any condition in any kind of weather. The product itself has a promise and you don’t have really to splurge onto something just for a show.
Internally, the organizational flow must be clear and we-delegated to avoid confusion.
The company has long-standing programs for its clients and fans. There is Corse Clienti or the owner-driver competitions, the FXX program in a factory designation where state-of-arts components can be found and the Carrozzeria Scaglieti Personalization Program for car customization.
Since, the company is already serving the fans and clients, it is high time that they serve the community. With their high profits, they can build training centres and schools which will specialize in car manufacturing, car engineering and production and assembly. They can even offer short courses like car painting, under chassis development, managing race tracks among others. They can also try to train future racers adept in the Ferrari culture. They company must engage in cultivating youthful audience and exploit their talents and potentials.
It is within the company’s capacity to acquire small companies that are manufacturing raw materials for car production. If the Ferrari company is going to do this, they will be able to create more jobs and thus, help diminish the unemployment rate in Italy.
The company must realize the importance of social responsibility. Their interests must lead to the public’s good and welfare.
Bibliography
Reference List
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Annex 2
FERRARI’S ORGANIZATIONAL CHART
Annex 3
TIMELINEOF FERRARI’S TECHNOLOGICAL SUCCESS
1945 Five-speed transmission for production cars
1946 Hairpin valve springs
1947 1.5 litre V12 engine
1950 Parallelogram-link de Dion rear axle location
1951 Central-pivoting drum-brake shoes
1952 Roller-faced self-sprung cam followers
1953 Three-eared knock-off wheel spinners
1955 Twin-cylinder formula engine
1956 65” Dino V6 engine
1959 The 854 “Ferrarina” engine
1961 The 120” V6 engine
1962 Gearbox between engine and differential of a mid-engined racing car
1963 Direct fuel injection applied to small displacement engines
1964 Flat-12 racing engines
1966 United front engine and rear transaxle
1967 Transverse-mounted Dino V6
1968 Aerodynamic wings to generate downforce
1969 The Pininfarina/Ferrari Sigma Grand Prix project
1971 Flat-12 engines for road cars
1972 The ‘Spazzaneve’ – a Formula 1 laboratory
1975 Shrouded wheels for improved aerodynamic
1981 Comprex super charger
1983 Auxiliary wings to provide downforce
1984 Rear-mounted radiators for a road-going car
1987 Experimental vehicle for advanced materials and components
1988 Semi-automatic Formula 1 gerabox
1991 Ceramic components for Formula 1 engines
1994 Downforce on production cars
1995 Underbody aerodynamics on the F50
1996 Material advances in the fabrication of brake callipers
1997 Digital indicators on Formula 1 steering wheels
1999 All-aluminium car
2002 The steering wheel as a command instrument on production cars
2004 The F430 inaugurates a new season of high technology, the fruit of F1 success
2005 Ferrari Superamerica is the first production car to use an innovative mechanism for rotating roof movement combined with electrochromic technology
2006 Numerous innovative components are fitted in the 599 GTB Fiorano, the new 12-cylinder Berlinetta from Ferrari
Annex 4
OUTLINE OF MASTER PLAN
1) Gestione Industriale
a) Foundry
b) Nuova Officina Meccanica
c) Engine mounting
d) New paintshop
e) Experience
f) Car servicing
g) Galleria del vento
h) Chassis and Aluminium assembly
2) Management, offices and services
a) Presidenza
b) Product and development centre
c) Offices and services
d) Galleria Ferrari
3) Gestione Sportiva
a) Offices and workshops
b) Compositi
c) Meccanica
d) Logistics
e) Galeria del vento F1
4) Circuits
a) Fiorano and Mugello
Credit:ivythesis.typepad.com
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