How Intuit Revolutionized Financial Software by Observing What Customers Couldn't Articulate

A real-time example of an organization that successfully utilized observational research techniques to gain innovative insights and achieve significant benefits is Intuit with their development of the QuickBooks and TurboTax software.

The Challenge:

Intuit, a financial software company, was looking to innovate its products for small businesses and individual taxpayers. While customer surveys and focus groups provided useful feedback, they primarily resulted in requests for incremental improvements, such as enhanced features or better pricing. These traditional methods did not uncover the deeper, unarticulated needs of their users, particularly those related to the frustrations and challenges they faced while managing finances.

The Approach:

To move beyond incremental improvements, Intuit adopted an observational research approach, known as "Follow Me Home." This involved product managers, engineers, and designers visiting customers' homes and offices to watch them use Intuit's products in their real environments. Instead of asking customers directly what they wanted, Intuit’s team observed how users interacted with the software, noted where they struggled, and identified pain points that customers didn’t even realize they had.

The Insight:

During these observational sessions, Intuit discovered that many small business owners and individual taxpayers found financial management and tax preparation to be overwhelming and confusing. The tools available at the time were either too complex or did not address specific needs effectively. For example, customers struggled with data entry and understanding tax forms, which led to frustration and errors.

The Innovation:

Using the insights gained from these observations, Intuit developed more user-friendly, intuitive software solutions like QuickBooks for small business accounting and TurboTax for personal tax preparation. These products were designed to simplify the processes, automate tedious tasks, and provide clear guidance to users, making financial management and tax filing much easier.

The Outcome:

QuickBooks and TurboTax became enormously successful products, revolutionizing the way small businesses and individuals manage their finances. They dominate their respective markets, generating billions in revenue for Intuit. The success of these products is largely attributed to the deep understanding of customer needs that Intuit gained through its observational research approach.

The Benefit:

By shifting from traditional customer feedback methods to a more observational and empathetic approach, Intuit was able to identify and solve problems that customers themselves couldn’t articulate. This approach led to the creation of groundbreaking products that not only met customers’ needs but also exceeded their expectations, establishing Intuit as a leader in financial software innovation.

This example illustrates how companies can use observational research to uncover insights that lead to major innovations, rather than just incremental improvements, by understanding customers' unspoken needs and challenges.