From Harvard Business Review.
During last fall’s America’s Cup, Oracle Team USA staged the greatest comeback in modern sports history. On September 18, Skipper Jimmy Spithill’s crew was behind 8-1 in the best of 17 series. In just over a week, they rattled off eight straight victories to defeat Team New Zealand, 9-8. New Zealand didn’t get slower; Oracle got that much faster.
Hoping to find some generalizable lessons from the spectacular turnaround, we spent time learning about what happened that week from one of the crew, grinder Gilberto Nobili. What we heard suggested six pieces of advice that leaders of land-based businesses might do just as well to heed.
CrossFit your company. This Cup was a departure from previous ones in various respects. For one thing, to attract a wider audience, it was held within the confines of San Francisco Bay. And to amp up the spectator experience, the AC 72 – a boat that sails faster than the wind powering it – was introduced. Both put new demands on crews. On a traditional ocean course, a great deal of activity would go into tacking and setting a course, followed by a long period of relative inactivity. On an AC 72 in a bay, there is no such thing as inactivity. The boats require nearly constant maneuvering – and a crew continually in motion.
Nobili credits a CrossFit training regimen for helping the team prepare, not just physically but also psychologically: “A key element of the CrossFit approach is that every day presents a different challenge. It got us used to thinking and doing different things together every day.” It’s that mental exercise that carries over as a lesson for businesses. Companies tend to creating rigid routines for specialized tasks to achieve productivity, but they pay for that in reduced agility and resilience. They, too, need to build the “connective tissue” that will allow people to make smart, spontaneous moves to create customer value, in coordination with others.
Learn quickly from disruption. This Cup also featured a disruptive innovation: the practice of “foiling.” Sailboats have always sailed through the water; the new speed possible with the AC 72 allowed them to rise above the water. But it’s no small matter to control a foiling boat – and the reigning champion Oracle saw no reason to take the risk. As Nobili explained, “We designed our boat for displacement sailing. We didn’t think about foiling. New Zealand approached the race differently. They designed a 33-foot foiling boat years ago and then built their AC 72 with those lessons in mind.” As Oracle’s losses mounted, the new reality became clear: “We wouldn’t win if we couldn’t foil; New Zealand had a head start of many months.”
To Oracle’s credit, it responded fast. Designers reworked the boat itself, reshaping and repositioning foils and wings and redistributing weight; meanwhile the crew practiced the techniques. The stunning outcome underscores the lesson for any business: When disruption hits your business, recognize it, and start making your own transformation instantly.
Make your luck. Both teams assumed foiling was a downwind technique. Downwind legs are essentially straight (and thus don’t require lateral resistance from the underwater foils) and the angle to the wind (wind from “behind” the boat) offers enough boat speed to lift the boat from the water. So the first thing Oracle set out to learn was how to foil downwind.
But San Francisco Bay is a relatively small area. Oracle couldn’t sail downwind for a long distance to practice. They would quickly run out of Bay and need to work their way back upwind to try foiling again. The crew could have used the time sailing upwind to recover. Instead they tried foiling upwind – and discovered a winning strategy. Our study of the race interval data makes it clear that it was Oracle’s upwind foiling that drove their comeback.
The generalizable point here is that what began as an irritating constraint turned into a piece of luck – but only because Oracle approached it with curiosity. If the race had been held on a traditional ocean course, the ideal conditions would have prevented the discovery. Likewise, managers make their own luck when they look with fresh eyes at conditions they are facing and refuse to be limited by assumptions.
Gather resolve from your setbacks. Race preparation presented a number of challenges to Oracle. Nobili recalled, “We broke a foil the second or third day we had with the first boat. That stopped us for a month.” When the boat was repaired, they sailed for five days before crashing it. As a result, “we had to commit to the design of the second boat without enough time sailing the first to learn what worked and what didn’t.”
But the team found an upside. The setbacks, Nobili said, “put our team in a situation where we realized: we need to stand up.” The benefit – which has just as much application to business settings – was to instill a rough-and-ready mindset that they could call on later. “It ended up serving as something that made us a little bit stronger in spirit and changed how we reacted to the situation of falling behind.”
Keep the focus on “How could we do better?” In the early days of the Cup, as Oracle’s losses mounted, there were many opportunities to second-guess and point fingers. Instead, Oracle kept the focus on the only thing that mattered: getting faster in the next outing. Nobili told us, “After each race, crew members did their best to offer ideas on how to improve performance. When someone offered an idea, others would quickly try to build on it.”
The race format doesn’t provide a chance to test ideas before committing to them. Each evening the sailors needed rest. Overnight, technicians made adjustments to the boat. The next morning, the crew would be sailing a boat rather different from the one they raced the previous day. How could Oracle decide which risks to take?
The answer is contained in an example Nobili recalled: “When we were down 6-1 or 6-0, I began talking with the guy in front of me about an idea and he said, ‘Let’s try it – it won’t be worse.’ Elaborating on a point we think managers should take to heart, he explained: “If a change could slow the boat down, you don’t even try. But if an experienced crew and skipper agree it might make the boat faster, you must try.”
Respect the data. Sailors pride themselves on their ability to feel when their boat is in a groove, performing at its peak. But the AC 72, as the most “wired” race boat ever built, produces data that sometimes counters that gut feel in challenging ways. As Nobili said, “In the AC 72, sometimes you have to trust the number more than your feeling – and that works only if you have good numbers and good tools.”
Of course, the same is true for businesses where executives are often inclined to ignore data that doesn’t match what a trusted manager or important customer said in some recent conversation. Better metrics often produce surprises – by revealing, for instance, the loyal customers who are actually unprofitable to serve – and the disloyal ones who are profitable. But if sailors with their feet planted on a deck can learn to rely on data, then managers surely can, too – and whichever type of helm they stand at, they might stand to win.
More blog posts by Nathan Bennett and Dave Forquer