Compliance in pole position: the parallels between procurement and Formula 1

At first glance, construction procurement and Formula 1 may appear to be worlds apart. One centres around the acquisition of services or materials for building projects, while the other is a high-speed, high-stakes sport.

Dig a little deeper, however, and you will find striking similarities between the two – with both focusing on adherence to regulations and finding the “formula” to get the very best out of rules while ensuring all-important compliance.

Both construction procurement and F1 operate in high-pressure environments, where timing, precision and adherence to strict regulations are unbending. In F1, every gram of a car’s weight counts. Similarly, in construction, every penny spent should translate into optimal project outcomes. In both worlds, delays, missteps or misinterpretation of the rules can result in significant penalties.

The needle moves in both spaces every few years. Next year will see F1 adopting hybrid engines with greater focus on electric power and 100% sustainable fuel, while the Procurement Act, which comes into force today (24 February) is set to completely overhaul how public bodies buy goods and services from this year. These changes mean that  innovation, problem-solving under pressure and collaboration will be the key to success in both fields.

Playing within the rules while breaking new ground

Whether procuring and building a skyscraper or winning a race, success comes down to an ability to navigate a complex web of challenges while staying within the confines of strict rules.

In F1, teams must comply with complex regulations and work within tight budgets to remain competitive. Every gram of weight, every aerodynamic tweak, and every penny spent must comply – building the very best car for that season or set of regulations.

Unlocking prime performance within the regulations can make or break an F1 team’s performance year to year. A prime example is the 2024 season. At the outset, it looked certain that Red Bull would be leading the field following the most dominant season for any team in history in 2023. However, advances in design took McLaren from back-of-the-grid mediocrity to winning the world constructors’ championship for the first time since 1998.

Procurement demands rigorous compliance with legal standards, but there is the opportunity to work in the same way to make the most out of the rules while keeping compliance. Lots is changing with this reform, such as the length of standstill periods, procedures and notices required throughout the process, and introduction of new terminology – the latter moving away from familiar EU language that many are used to.

A further synergy can be seen in the importance of data for performance in both construction and F1 – but the difference here is where each is at in its technology adoption. The construction sector has a notorious reputation for slow adoption of technology, while F1 is well-known for its impeccable use of data, with advances in simulation and data analysis continuing to push the boundaries of what is possible on track.

But this is somewhere we can learn from – with less siloed data, and more centralised systems we can continuously improve not just within organisations or project teams, but across the entire industry.

We are seeing a move in this direction, and indeed the Procurement Act will see a new central procurement platform created into which all e-procurement systems will feed into – pushing the transparency agenda, along with better adoption of digital tools for data-sharing. Ultimately, this is a space construction could make huge strides in, with more and more practices and legislation pushing towards better leveraging of data analytics to predict, identify, and optimise processes.

Getting it right – a fine art

Balancing pushing the boundaries to just the right point is a balancing act that requires creativity and precision.

F1’s history is littered with examples that have fallen on either side of the fence. Brawn GP’s hotly contested but ultimately legal double diffuser innovation in 2008 secured both driver and team titles that year after an innovative head start on other teams.

On the other hands, Mercedes’ DAS (Dual Axis Steering) system was banned in 2021 for providing an “unfair advantage” – but does demonstrate the power of lateral thinking within regulatory frameworks, which is a mindset construction and procurement teams can adopt to supercharge innovation.

The rewards and risks are clear in motorsport – but for procurement, the risks of not getting things completely and compliantly within the regulations haven’t been as clear cut. Procurement reform in 2025 changes this, with more stringent rules and the introduction of a debarment list that seeks to protect investments from suppliers that pose risk – though while the Act widens the grounds for excluding suppliers, there is a strong risk it remains under-used.

There is also a swing towards “value” – aka what absolute maximum benefit can be created from any action. It is not just about the bottom line. There is a clear shift from most economically advantageous tender (MEAT) to most advantageous tender (MAT), indicating that focus on the bigger picture and finding the right formula for optimum performance – aligning procurement processes with broad economic and social goals.

But whenever changes come forwards, having experienced teams that have proper understanding of the regulations – along with the skills to unlock performance under them – will be central to success. That is why one of the biggest stories from F1 in 2024 was legendary designer Adrian Newey leaving Red Bull to join Aston Martin.

With 13 winning cars to his name, having him on your team is seen as the winning formula to maximising car design under regulations – aka getting the best value by getting the absolute most out of the design.

For procurement, frameworks will continue to hold a valuable role in the construction sector into the future. They will allow client teams to access the skills of the Adrian Neweys of procurement – those professionals with a track record of compliance and success in delivering value from public sector investments.

Preparing for the future

At their core, both Formula 1 and construction procurement routes are about more than just speed or materials – they are about strategy, efficiency and excellence.

By staying ahead of regulatory changes and leveraging emerging technologies, both sectors can turn challenges into opportunities. Just like with F1 teams looking to get ahead by understanding the next step of regulations well ahead of their introduction in 2026, procurement teams will succeed by getting ahead of the game as the new regulations kick in this week.

Both industries rely on efficient sourcing, meticulous planning and a laser focus on compliance to achieve success. Through prioritising outcomes that combine cost-efficiency, sustainability, and social impact, procurement teams can achieve “best value” in a manner akin to F1’s pursuit of podium finishes.

Simon Toplass is group chief executive at Pagabo