In the course of a NASCAR race, drivers scoot their cars into the pits at regular intervals to have their tires replaced, whether they need it or not. A blowout on the track would be a competitive detriment and could result in serious injury or fatality. Getting new rubber on the wheels before the previous tires wear out simply makes good sense.
Sixty years after its founding and now in its third generation of family leadership, the country's largest sanctioning body of motor sports likewise prefers to engineer changes before problems become apparent. In particular, since Brian Z. France, the grandson of NASCAR founder William H.G. “Big Bill” France, took over from his father as chairman and CEO five years ago, the organization has embarked upon a steady stream of changes in its operations both on and off the track.
“It's a tough dilemma for us,” says Brian France, 45. “Expansion and format changes and other things can affect the core audience. We try to give our core customer the central things that they love about NASCAR, which is close, competitive racing, access to the drivers, great broadcasts and great competition on the track. Those are all hard things to deliver week in and week out. We try to make sure to never lose sight of that. And then every other thing that we might look at or consider must complement that.”
At least one family business observer thinks France and his family have tinkered with NASCAR's formula very well. “One of the old clichés floating around family businesses is ‘If it ain't broke, don't fix it.' That's some of the worst business advice anybody ever uttered, and it's terrible advice for family businesses,” says Wayne Rivers, president and cofounder of the Family Business Institute in Raleigh, N.C. “[NASCAR's] racing teams practice the ‘If it ain't broke, fix it anyway' philosophy, especially when you think about pit stops. In a sense they reinvent the car every 45 or 50 laps or whatever it is. The France family does the same thing.”
Rivers interviewed France a couple of years ago for his weekly radio show and recalls the NASCAR head saying that he and his family spent 85% of their time in self-reflection and self-criticism.
“They're always looking for ways to reinvent themselves,” Rivers says. “They view themselves as the underdog. They try not to read their press clips too often. That's a tremendous philosophy that a lot of family businesses don't subscribe to.”
Big Bill France spearheaded the founding of the National Association for Stock Car Auto Racing during a series of meetings with racers and promoters in Daytona Beach, Fla., in late 1947 and early 1948. Legend has it that the first points system was scrawled on a cocktail napkin. From those humble beginnings grew one of the country's most popular sports.
Big Bill standardized the sport's rules, organized a regular schedule and implemented a formal championship series, and stock car racing quickly began to grow. He built a pair of seminal racetracks, in Daytona and Talladega, Ala., and founded the International Speedway Corporation, a motorsports entertainment company, before handing the reins to his son, William C. France, in 1972. During the younger France's 31-year tenure, NASCAR made huge inroads into television broadcasting and corporate sponsorships. It evolved into a multibillion-dollar operation, one that stages 17 of the top 20 attended sporting events in the U.S. and whose TV ratings trail only those of the National Football League.
NASCAR, citing its status as a private company, declined to provide specific dollar figures. Last July Forbes reported that its new eight-year TV deal with ABC, ESPN, Fox and TNT would pour $4.4 billion into the firm's coffers; in 2005 a Fortune story, which NASCAR does not dispute, noted that during the previous year the company raked in $56 million through sales of merchandise, $189 million in sponsorships, $54 from television and other media outlets and $80 million in sanction fees. “The privately held company gets the smallest cut of revenues but has lower costs,” the magazine noted. “It has made billions for the France family.”
In 2003 Bill C. France stepped aside in favor of his son, Brian, who had spent years with NASCAR managing its marketing department and touring divisions, heading its Los Angeles office, running racetracks, negotiating new TV deals and co-founding the Craftsman Truck Series. Brian France quickly set about putting his own imprimatur on NASCAR. He transitioned sponsorship of its top racing series from R.J. Reynolds to NEXTEL, implemented a new championship points system and reached out to international drivers, luring many of them from open-wheeled racing to stock cars. Spurred by the death of Dale Earnhardt Sr., in a crash during the final lap of the 2001 Daytona 500, France launched a series of safety initiatives, including the development of a safer racecar known as the Car of Tomorrow.
France's aggressive moves earned him an admiring nod from The Sporting News, which named him one of the five most powerful sports executives in 2005. They also attracted slings and arrows from racing fans who were very happy with the way things were, thank you very much.
“You just can't worry about it,” France says of the criticism. “You have to go on. It was a great opportunity is how I certainly looked at it, and if you run into anything of importance, you ought to have some professional pride and accomplish some things on your own, not just sort of hanging on to what was done in the past.”
Big Bill France died in 1992; lung cancer claimed Bill C. France in 2007. In contrast to his father and grandfather, Brian France is an understated man, who seems content to let the outsized personalities of his predecessors rest in peace. Rivers believes Brian France's willingness to be his own leader has been a tremendous asset for NASCAR.
“He made a decision early on which I think was very perceptive,” says Rivers. “He realized that following in the footsteps of legends could be a tall order. He decided early on to focus on his leadership on a few key values he and the family business subscribe to. Instead of developing his own individual larger-than-life management persona, he lives and manages by that sort of core principles.”
France says that when he assumed the mantle of command five years ago, his father was clear in explaining to his family that leadership truly was changing hands.
“Getting the understanding between my father and the rest of the family members as to exactly what the role was going be and exactly the autonomy you have to have to be able to be able to lead the company was the central part of taking over,” he says. “Getting those ground rules carefully understood so that you can do your job the best that you can and they can support you and measure you.”
The other family members involved in NASCAR are James C. France, Brian's uncle, who is vice chairman and executive vice president; Betty Jane France, Brian's mother, who is assistant secretary; and Lesa France Kennedy, Brian's sister, who is the organization's vice president and assistant treasurer and president of International Speedway Corp. A February 2004 article in Business Week alluded to rivalry between Brian and his sister, whose husband, plastic surgeon Bruce Kennedy, was killed in a July 2007 plane crash. “We do run into heavy competitive situations,” Lesa France Kennedy told Business Week. (James C. France, Betty Jane France and Lesa France Kennedy either declined comment through a NASCAR spokesman or did not respond to requests for comment for this article.)
“You have to, like anything else, be very considerate of their views,” Brian France says. “They own the company with you, and whatever else [happens,] they have a big stake in it.”
According to France, while the family controls the company, it also has put into place a management team that it tries to empower “in a very professional way” so that roles are clearly defined and business matters don't get tied up in family matters.
“We've tried to formalize the family relationship with the business relationship, because … with family businesses … it can sometimes be confusing,” France says. “Is it a lifestyle? Is it a family? Is it a business? Do they go together? Sometimes or often? You have to come back to, ‘What are the performance goals of the company, and how do you reach them fast?' And if that's a family member, because they know the business better and they're qualified and they want to do it, that's great; if that's not the case, then you have to look at another way to do it, and that's how we look at it.”
When family members disagree, says France, it is important to have the formalized structures and independent management team in place so that he can make dispassionate decisions that most benefit the organization.
“You try to be direct, you try to take them back to the merits of what you're trying to get done,” he says. “The management team has a pretty defined set of goals and objectives, and either we're meeting them or not, and you can debate sometimes on how you get there, but most of the time you have to defer to your management team anyway. You can't ask them to deliver at a high level and be second-guessing them all the time. You try to just work things in a very professional way. We've been pretty effective at that as a family in recent years.”
By virtually any standard nascar has been a stunning success, yet as Brian France shepherds it into the 21st century, challenges have sprung up. Television ratings are down, some drivers have complained about the new safety measures that have been mandated for their cars, and France firmly believes that, despite racing's popularity, his sport is “undercovered” by sports talk radio and daily newspapers.
“I say ‘undercovered' for the size audience we have in just about every market,” says France, who adds that NASCAR considers the situation an opportunity: “That's all upside for us…. We look at that as a chance to educate editors and programmers and so on that traditionally have given space and time to other sports because that's historically how they did it, not based on what the audience wants to hear, read or see.”
For an organization that places considerable emphasis on its family aspect—France calls it “a defining characteristic of the sport”—NASCAR had to deal with a very visible family spat in 2007, when Dale Earnhardt Jr. left the team his late father had founded and signed with a new team. At issue was ownership of the team, with Earnhardt seeking a larger share than his stepmother—Dale Sr.'s widow, Teresa—was willing to give.
“I was disappointed that they weren't able to resolve that,” France says. “That is a classic example of kind of getting your goals and objectives not lined up the way you thought they should be, and not being able to have a strategy to work through it. I wish they would have been able to, but they didn't.”
For two years NASCAR fought a federal antitrust lawsuit, filed in 2005, alleging that it illegally favors tracks owned by International Speedway Corp. The suit was dismissed in January 2008; the plaintiff is appealing the decision.
France says that over the next few years he hopes to continue growing NASCAR, but he acknowledges that trying to keep his drivers safe, his races competitive, his costs down and his revenues up presents perhaps his most pressing challenge.
“Those are hard things to do in our business that are different than most sports, [which] that don't have the rules … that are so impactful as to what you do,” he says. “We're trying to get those things done first, and then we'll look at international opportunities and some other things that will be available to us. We've got our hands full just doing our core business.”
On top of all that, France must juggle the combined responsibilities of business and family (he is married, with twins) while simultaneously performing in a spotlight shone on him by a large and vocal fan base. NASCAR is more than a sports sanctioning organization—it is a brand.
“If you think about branding, the visibility of drivers, and the loyal base of fans, other than maybe Harley Davidson, there's not many companies that have branded themselves more successfully than NASCAR,” the Family Business Institute's Rivers says. “They were a little late coming to the safety game, but the Dale Earnhardt situation rectified that, and since then their safety has been great.”
“We have a lot of stakeholders that are counting on us to do the right thing as much as possible, and shareholders, of course, that are demanding that we perform at a high level,” France says. “So, yeah, I think you obviously take all that into consideration. You know you're going to get second-guessed more so than in sort of a quieter industry that somebody might be running. We run a very public industry.”
Thomas W. Durso is a freelance writer based in Glenside, Pa.