Why Can an Owner Take a Longer Bet Than a Hired Boss?

Toto Wolff says an owner can make a call and keep the job, while a hired boss who skips the hierarchy can lose the job for the same decision.

He runs Mercedes like a 20-person organization. The decisions are quick, taken in the interest of the team, and still checked against the consequences for the brand. At Ferrari the team principal is one of 10 direct reports to the CEO, so a marketing person in the racing team can sit at the same level. Red Bull has an employed team principal reporting to a group of shareholders. Audi hires people from the car group and from Formula 1, on a salary and maybe a bonus. Wolff was handed a long leash, and he says there is no leash now because they are partners. Until he badly screws up, the decisions are his and he cannot be fired. A manager on a three-year or five-year contract, paid partly in stock options, is pushed to maximize that payout and is afraid of looking bad to the people grading the work. His own horizon is 10 years, not one year. Dietrich Mateschitz, the founder of Red Bull, told him an entrepreneur needs to ski downhill and also be able to stop and walk back up the hill.