Somehow, I wound up with a subscription to Business 2.0 magazine several years ago; I’ve kept the subscription going because it usually offers more thoughtful articles than the typical “Great Men — and Carly Fiorina — of Business” drivel one usually finds in such CEO-lebrity glossies as Fortune, Forbes, and Inc.
Biz2 always seemed a little smarter than that: it was the place I first encountered the terrific information graphics produced by Xplane — I think it was a pretty successful symbiotic relationship for the two companies. But then, after a lot of financial troubles, Business 2.0 was purchased by Time Warner/AOL, the publisher of Inc., and Fortune…
So, I shouldn’t have been surprised, but I was more than a little disappointed to read this month’s cover hagiography of Intuit‘s Steve Bennett, entitled, “The Hottest CEO in Tech“. The author spends most of his 3400 words describing how Bennett has made Intuit a much more successful company than it had been. That success is measured in increased profitability, market segmentation, cost-cutting, and — of course — the blessing of Wall Street. All valid indicators of success, but far from the only indicators.
See, Bennett brought with him from his old company, GE, a passion for process excellence and Six Sigma — the Gospel preached by St. Jack Welch. Six Sigma seeks to eliminate defects in business processes: defects being defined as “anything outside the customer’s expectations.” Sounds good, but somehow, the article doesn’t often seem to focus on the customer.
And that’s the big problem. When Scott Cook founded the company, the focus was fanatically on the customer:
As a result, Intuit owned the personal finance software market. And the tax prep software market. And the small business bookkeeping market. It beat Microsoft at every turn, even after the behemoth almost bought Intuit.
But what have they done since Bennett took over? Why they’ve diversified their product line. Say you’re shopping for home finance software. Do you want Quicken for Macintosh? Quicken Deluxe? Quicken Premier? Quicken Premier for Home & Business?
Or maybe you’re doing your taxes. Do you need TurboTax Deluxe? TurboTax Premier? TurboTax Deluxe Investor Edition? TurboTax Deluxe Retirement Planning? TurboTax Premier Home & Business? TurboTax Basic? TurboTax Business? TurboTax for the Web? Macintosh versions? Spanish editions?
Maybe you run a small business. Do you want QuickBooks Online? QuickBooks Basic? QuickBooks Pro? QuickBooks Premier? QuickBooks Enterprise Editions? The specialized versions of QuickBooks for Accounting Firms, Contractors (Construction), Healthcare Practices and Nonprofit Organizations? Or maybe you need the QuickBooks Point of Sale Software for Retailers?
Are you dizzy yet? The niches have expanded, but the software hasn’t. The Six-Sigma acolytes have been so focused on finding and infiltrating every potential market segment, that they’ve seemingly forgotten the core functionality of the product. The checkbook metaphor has been the basis of Quicken’s interface for more than 10 years. It was great when people were weaning themselves away from their paper checkbooks, but in the intervening years, how many people have only ever experienced a checkbook register when using Quicken? The metaphor designed for an easy transition has become frozen as the pinnacle of design. Where is the innovation in anything but marketing? When was the last time a software developer called up a user to ask how his product could be improved? Some engineers aren’t happy; one interviewee reports, “several have talked of resigning once the economy picks up. ‘It stopped being fun working here,’ this programmer said.”
But that ominous statement about the core of the company is quickly followed by Wall Street happy-talk about pricing strategies, add-on services, and the continuing importation of Six-Sigma devotees from GE. All this focus on financial performance led to what has become a major blunder in Intuit’s relationship with its customers: this year’s TurboTax digital-rights management fiasco.
As Bill Machrone reports in his May 27, 2003 PC Magazine column:
Someone — who was most likely computing sigma values and wondering whether there was anyone who would pay for an Esperanto version of TurboTax — didn’t bother to ask customers how they would feel about installing software which produced “Windows File Protection” errors, requiring the user to provide the original WinXP installation CD to remedy the problem. They didn’t think customers would be upset at having software prohibit them from re-installing the software on a different machine. They didn’t think the user would mind having a part of their tax software remain on their machine after installation: logging, monitoring, and slowing the computer down. They didn’t put any value on the incredible word-of-mouth advertising generated by users who passed a disc on to a family member one year, leading that user to purchase the program the next year.
Instead, they’ve pissed off people — like me — who automatically associated “tax season” with “TurboTax purchase.” I’ve been using TurboTax since 1989, but this year I used TaxCut for the first time. My taxes are pretty simple, and TaxCut was able to read my TurboTax data file from last year, so I don’t see myself going back anytime soon. I doubt if I’m alone.
So, while the Biz2 article seems to revere Steve Bennett and his work at Intuit, I wonder if Scott Cook feels the same way when a columnist at ZiffDavis’s ExtremeTech website has to remind Intuit:
