Gaule’s Question Time: The jewel in the crown

Introduce yourself and McLaren Applied Technologies.

Yes, well basically I am one of the early founders of McLaren Applied Technologies. Happy to say I have been here five years and I am now heading up the new business development, of what Ron Dennis would describe as “the jewel in the crown of McLaren Technology Group”.

Good, and it has been four years since the first interview I did with you for Global Corporate Venturing so the purpose of this is to really give a bit of an update. First of all you have just hinted there: McLaren Group is now known as McLaren Technology Group and you lead Applied Technologies. Can you explain the significance of this group name change and why Applied Technologies is now so important?

Yes absolutely. Originally, McLaren Applied Technologies was set up to recognise that we have years and years of research, intellectual property and hundreds of millions of pounds worth of investment that has gone into racing, that has never been capitalised or exploited elsewhere. But much more than that, the way we tackle problems, the way we fast track working prototypes into new industries, sets the scene for a significant diversification from racing into many new businesses. And now, I would say, since we last interviewed, we have sustained double digit growth and profitability without any external investment over that period. So that gives us the confidence to say, “If we carry on at this pace, why would we not be a global technology business that also goes racing?” And that is our ambition. We think that the technology business will overtake the racing business over the next ten years.

So one example of that – I worked with McLaren years ago in seeding and then developing the joint programme with National Air Traffic services for the ground management. Could you give us an introduction to that venture and how it has developed over the years?

Well it is interesting, from that very early encounter which you might refer to as “managed serendipity”, you filled a room with people who probably had similar challenges but came from completely diverse backgrounds. They saw a learning from the way we do pit stop challenges to how they could do rapid turnaround of planes in airports. This year we are aiming to actually implement, at Heathrow Airport, a system that was inspired by that early conversation, which we expect will deliver improved performance for Heathrow Airport, in terms of getting passengers in and out on schedule.

Another area which has been very much in the public domain is the work you have done with GlaxosmithKline. Can you explain the benefits of the collaboration and how that is working in the health and consumer goods business?

Yes, GlaxoSmithKline (GSK) represents the strategic partnerships we try to cement with McLaren Applied Technologies. It is where we want to work with pioneers and visionaries in those organisations who have the ambition to transform their business and deliver true breakthroughs in performance. So with GSK we have done some significant firsts: we have implemented biotelemetry for use of live monitoring of patients in clinical trials, yielding significant improvements in insight for the clinicians in those trials. Also we have worked in the manufacturing side of GSK where we have delivered substantial savings in non-productive time, in some fast moving consumer health product factories, as well as significant increases in productivity and efficiency, through a combination of engineering, analytics and cultural intervention, yielding millions of pounds worth of new value for GSK. So we have learned, through engaging with a global operator like that, that is striving to achieve new levels of performance, and I think they have benefited from bringing in a completely fresh perspective from people who are fearless about new markets, but also humble enough to engage with their team on the ground.

Developing from that, I understand, you are now scaling that up within your corporate venturing activities and a partnership with KPMG. How is that partnership working to deliver solutions to organisations?

KPMG is also a true pioneer in the sense that our partnership will transform the way they do business, both in the financial sector but also in many other sectors, through our joint go-to-market initiatives around operational excellence. We believe that the combination of our technical skills in data management, analytics and simulation, to deliver high-performance design of processes and operations, with their domain expertise, scale and also financial modelling acumen, the really rare combination of what many people refer to as “asset based consultancy”.

Very much current at the moment, Ron Dennis has recently come out and announced the £300m fund investment and that which goes along with the McLaren Technology Group. What areas can you give us insight on how that is going to be developing at the moment?

Well I think an investment of that magnitude just shows the seriousness and the scale of the ambition for the organisation. I think the first manifest evidence of that investment will be an acceleration of a pipeline of new IP that we develop for future releases of products with partners, plus a new facility to house the ever expanding and growing McLaren Applied Technologies team – so one new building on the technology campus and continued expansion abroad, in Asia and the Americas.

How are you seeing the change in technology and business models now really coming through and where you see what I term “new innovative value chains”?

Well it is interesting, I suppose I am seeing a lot of more true convergence these days, so that it is very hard to distinguish between IT, design, engineering, operations and even economics. I think so many operations now have to be tackled from a holistic point of view; and because we can measure so much of what we are trying to manage, it opens the doors to performance-related business models in a much broader sense. And certainly, as a company, that is something we are hoping to capitalise on, because we specialise in performance management, prediction and optimisation. We are seeing that the ability to measure what we want to manage is becoming more and more pervasive. Sensing and internet of things is more embedded and intrinsic to so much more in our world, whether it is clothing we wear or the buildings we work in or the houses we move around in. The instrumentation is there to inform us on the insights that we are seeking to extract. And that opens up new doors for business models, which are maybe not based on the article itself, but based on the meta-product: the value of the data that the products themselves generate.

When we last spoke I asked “What do you do to relax?” and you talked about sport, but also flamenco guitar playing. In the four years since I last interviewed you, how have your other activities outside of work been developing?

Well, I must admit my guitar playing has plateaued. It has certainly not gotten any better, and certainly I still would never dare play flamenco in public. But I like to think that the sum of your vices should always be a constant, I would like to say my guitar playing has gone down, but my wine consumption has gone up. That helps.

You can listen to this and other interviews on a podcast available at gaulesqt.podomatic.com. Gaule and McGrath will be involved in a “fireside chat” at the Global Corporate Venturing Symposium on June 2 in London: www.gcvsymposium.com.

Gaule leads the GCV Academy developing the capabilities and expertise of organisations leading open innovation, venturing and corporate venturing programmes to drive strategic benefit. Andrew also supports innovation programs and collaborations in new value chains in global organisations.

To contact Andrew Gaule and for future interview ideas email andy@roscahill.com or Toby Lewis tlewis@globalcorporateventuring.com