The Hindu Business Line : Starting with the 47th mover advantage

“The key was to reduce the time spent on three main activities: paying bills, maintaining a cheque register, and periodically totalling and reviewing expenditures.”

D.Murali

Ranking first in the ‘computer software’ category, among Fortune’s ‘America’s most admired companies 2007’, is Intuit ( www.intuit.com). Though ranking fourth in ‘financial soundness’ the company is No. 1 in many other parameters such as people management, use of corporate assets, social responsibility, quality of management and quality of products/services.

“We started small in 1983 with Quicken personal finance software, simplifying a common household dilemma: balancing the family chequebook. More than two decades later, our revenue tops $2 billion,” says the company site.

Back in 1983, the co-founders of the company, Scott Cook and Tom Proulx, used to meet “at Cook’s house or in Proulx’s dorm room,” write Suzanne Taylor and Kathy Schroeder in Inside Intuit ( www.HBSPress.org). “Talking directly to prospective customers had helped Cook build a deep understanding of exactly what people hated about their finances.”

He had commissioned his wife’s sister “to call hundreds of people about their personal financial habits, what they liked and what they disliked.” This was an approach Cook had learned from P&G, narrate the authors: “Understand potential customers’ behaviours and needs so thoroughly that the product will completely satisfy those needs and, at best, exceed them, ‘wowing’ customers.” A phone survey revealed that four out of five people hated dealing with personal finances. An incredible market opportunity, this was, for Cook. “The key was to reduce the time spent on three main activities: paying bills, maintaining a cheque register, and periodically totalling and reviewing expenditures.”

The financial software program had a working name: Kwik-Chek. Proulx worked on coding, and Cook went about learning “more about building a software company by interviewing anyone successful who might have something to teach him,” be it about “fund-raising, retail and channel marketing, competitive products, and launch practices.”

Cook and Proulx analysed 46 rival products already on the market. The duo would joke later that they had “the forty-seventh mover advantage.” Yet, a key finding in the analysis was that the competitors poorly met fundamental customer needs. Cook could see that the competitors were missing the mark “because software engineers focused on features, not on customers. They seemingly lacked input from marketing or customer research.” Thus, Kwik-Chek’s biggest potential competitor was the humble “pen and pencil”.

It didn’t take too long for the founders to decide a name for their venture. “Instincts” was an early possibility, informs the book. “But Cook observed that it sounded too much like ‘It stinks.’ ‘Intuit,’ on the other hand, expressed the overarching goal of making software so easy to use that it required almost no thought. ‘Intuitive’ became the watchword for the company’s product development for years to come.”

The product got a new name, ‘Quicken’, before its launch in 1984. To Cook the word “captured the time saving at the product’s core,” but Proulx wondered, “Er — isn’t that when a pregnant woman starts to feel her baby move?” Cook stuck to the name, and snapped back: “Yeah, Tom, that’s one meaning, but another is to speed up and to give life. That’s what our product is going to do, speed up people’s finances, give them back a part of their life…”

Lively read, even if a search for ‘Kwik-Chek’ on Intuit’s site were to show the message, “We’re sorry. No search results were found matching your keyword or question…”

“The big Indian companies and multinationals have fled from overcrowded Delhi to Gurgaon, which is about twenty miles away.”

Three potential futures for India

To Mark Tully, Gurgaon is one more example of a worldwide tendency — of prosperous individuals and organisations relocating to new areas and thus increasing the divide between private affluence and public squalor.

“The big Indian companies and multinationals have fled from overcrowded Delhi to Gurgaon, which is about twenty miles away,” he writes in India’s Unending Journey ( www. crosswordbookstores.com). “There, they have built a city of skyscrapers in what used to be a small town, once just the headquarters of a rural district administration.”

Tully finds Microsoft India’s office in Gurgaon to be more egalitarian than many older Indian companies. “There was no directors’ dining room and I could see that Ravi Venkatesan didn’t expect or receive the VIP treatment that most company chairmen in India regard as their right.”

Post lunch, Ravi opens his laptop and brings up “a diagram illustrating three potential futures for India.” There were three arrows pointing away from a crossroads, recounts Tully. “In one direction was an arrow with an elephant on it labelled ‘Bolly World’. The arrow rose sharply and then bent downwards. Bolly World, Ravi explained, was the future if India continued on its present path, with rapid economic development only benefiting a minority of the population.”

Then? “On the other side of the diagram, an arrow pointed straight into the sunrise. There was another elephant on the arrow, but her tail was up and she was balancing the globe on her trunk. This elephant was labelled ‘Pahle Bharat’, or ‘India First’. She symbolised an India in which everyone puts the nation first, determined that the entire country should benefit from its development.”

What about the third? “The third arrow shot straight down into the darkness and the elephant sliding down it was called ‘Atakta Bharat’, or ‘India Getting Stuck’. That dismal elephant warned of the possibility that the entire global economy might slow down, offering far fewer opportunities for the export of Indian goods and services that is fuelling the current rapid GDP growth, while within the country itself there would be little development and the little there was would be uneven.”

Recommended addition to your bookshelf, for the fresh perspective Tully offers to what we may often take for granted.

Tailpiece

“We could save on apartment maintenance by leasing out our terrace to a mobile operator’s tower but…”

“Your signals are still erratic?”

“No, signals are so clear that we talk more these days only to end up with fatter mobile phone bills that offset any saving we made on maintenance charges!”

dmurali@thehindu.co.in