Inside Intuit - Book Report

PART I: What Did You Learn? Writes a summary of what you learned from the book. The summary might include factual information, something learned about people in general, or some self-insight learned.

Inside Intuit - How the Makers of Quicken Beat Microsoft and Revolutionized an Entire Industry, written by Intuit veteran Suzanne Taylor and seasoned business manager Kathy Schroeder, is certainly a boon to new entrepreneurs and business school students. The classic story of a Silicon Valley technology company has a lot to offer to the future generations. Even though, Intuit is a technology company, the challenges it faced and the steps taken to get out of woods are a lesson to companies across industries. I am from a technical background, who is currently managing customer situations and customer relations for my company. I believe in customer loyalty more than customer satisfaction. This book demonstrated how successful a marriage between customer driven innovation and technology companies can be. In 1980s, high technology industry was dominated by giants like IBM, Microsoft, Oracle, etc. None of them emphasized on customer satisfaction as much as Intuit did. I have learnt several valuable lessons from this book, most importantly, innovation driven by customers, followed by market strategy for a known product, having self awareness for CEO and always put employees and customers in the front.

Clear Strategy and Market Positioning

When his wife complained about the drudgery of paying bills and writing checks, Scott Cook sprung up with the idea for new software. It wasn't as if Cook and Proulx, cofounder of Intuit, had come up with an idea no one else had, back in 1983. There were 46 different competitive products already on the market. The problem is that none of them worked particularly well. The real challenge is in reading the pulse of the customers and to provide software that gives more than what the existing players are providing. Instead of triggering off the search for a venture capitalist to fund his ideas, Scott Cook, immediately applied his P&G business principles, cold calling customers. Scott called customers in Palo Alto and Winnetka, IL and other upscale communities, who are likely to buy computers, to find out about their personal finance habits. This bootstrap research yielded a consistent set of problems, most of the customers disliked managing their finances. The key strategy that intuit is built upon are

1. Procter & Gamble consumer products techniques. Our authors have elucidated the fact that a former Crisco seller has turned into a tech entrepreneur. In P&G, the consumers are the most valuable asset to the company. Intuit's strategy was built upon the mission statement given below.

2. Our process for developing software that works the way consumers think. We call this intuitive software design. It improves learning time and speed-in-use by up to 10-fold versus existing software products.

P&G Mission Statement

"We will provide branded products and services of superior quality and value that improve the lives of the world's consumers. As a result, consumers will reward us with leadership sales, profit, and value creation, allowing our people, our shareholders, and the communities in which we live and work to prosper."

Market positioning or segmentation was achieved at a very early stage. In early 1980s, the market was flooded with video games and other personal computer (PC) softwares. The primary domain of computer users are younger demographic and the usage of PCs had no penetrated into the middle aged people (those who pay bills and balance checks). Scott Cook took calculated risks in venturing into the personal finance software market, given that the �home productivity/ home business’ segment is estimated at 26% of the total of $260 million in 1984.(Sources: Creative Strategies International, Future Computing.)

Scott Cook notes that the biggest insights often come in surprising and unexpected ways. These insights can lead to a completely new way of seeing problems. For instance, when Quicken was introduced, its main competition wasn’t the 46 other finance software programs out there, but the pen and checkbook. QuickBooks worked under the assumption that small businesspeople didn’t understand or want to do accounting. TurboTax enabled customers to tackle an overwhelmingly tedious task in small, manageable steps. The Internet radically changed how customers managed their finances. Intuit was quick to adapt to the changes sweeping across the technology industry. In early 1990s, Intuit was fighting a battle with DOJ and Microsoft, but it never failed to respond to the threat of being outmoded from the market place by not being Internet enabled.

Customer Driven Innovation and Customer responsiveness

The most valuable lesson from the Inuit saga is the customer focus, which is inculcated in to all the levels of the organization. The foundation of any company that wants to change its customers’, lives is deep, one-on-one listening and insight into customers’ needs. Intuit has consistently and cleverly used customer insight to build its breakthrough products, customer service, and marketing communications. Intuit pioneered customer research in the software industry with methods borrowed from Scott Cook’s alma mater Procter & Gamble including: follow me home studies, usability research, and customer advisory panels.

Their very first version of finished product, called Kwick-Chek, was then test marketed with a simple goal: Even PC novices should be able to install it on their computers and print a check within 15 minutes. The final test-marketing before the product's launch used one of their employee's connection with the Palo Alto Junior League. Its members were the test group. Relative computer novices, the Junior League members took an average of seven minutes to get the software up and running. Cook and Proulx recorded the average amount of time spent by the users in writing checks and paying bills. Nowadays, this kind of user testing is called "Beta" testing and software companies, hand pick selected users and ask them to test the software and provide their feedback.

Under Promise Over Deliver

Just as the chapter 5 said, Intuit was quick learners. The aggressive pursuit of release goals has compromised the quality of the product. As soon as they start receiving complain calls from the customers, they pulled out all nighters in packaging