Transcript bp executives used a few key levers to install t

Intuit Case Discussion
Managing in Information-Intensive Companies
August 27, 2009
Intuit created profitable
growth 2002 onwards
Intuit 1992-2004
2,500
8
6
2,000
4
2
1,500
in $ millions
0
1,000
-2
-4
500
-6
-8
0
1992
1993
1994
1995
1996
1997
1998
1999
2000
-500
2001
2002
2003
2004
2005
-10
-12
Net Sales
Net Income
EPS (Diluted)
Intuit stock price
outperformed 2002-2004
Four design parameters

Formal groupings


Location of decision rights


Which decisions at what level
Processes


By (mix of) functions, business units, geography, project
teams
Sequence of activities to organize work
Management responsibilities

Balance between unit and cross-unit focus
Step 1. Formally group into sharply
defined business units that have
important decision rights
Intuit: organically grew from one to 5+ product-markets
CEO
Bennett
Small Business
and Personal
Finance
Norrington
Business Unit
Primary Product
Professional
Accounting
Solutions
Manack
Consumer
Tax
Allanson
Personal
Finance
Supplies
Employer
Services
Accounting
Professional
Tax
Consumer
Tax
Quicken
Checks, Forms
Payroll
QuickBooks
ProTax
TurboTax
Push decisions “down,” give units freedom,
hold them accountable, reward performance
Vertical
Businesses
(Acquisitions)
Various
Businesses
and Products
Step 2. Develop a strong set of “service
minded” functions



Bennett put new senior people in charge of technology,
process excellence, IT, procurement
Doubled spending in HR
Allocated decisions into three buckets: corporate function
only, BU only, BU with corporate function guidance
Step 3. Develop processes to get work
done
Intuit example of e-store:
BUs
BU
- Product Marketing
- Direct Marketing
Hold Online
Strategy Meeting
with eStore
(design, timing)
Hold Online
Kickoff
Meeting
with eStore
Create
FRD for
eStore
Launch
Preliminary
Fulfillment
Matrix
Review
TRD
Corporate Operations
Begin
BOM
Setup
- Manufacturing
Review
& OK
Project
Plan
Corporate Marketing
- COM/CIS
Functions
Review
& OK
Project
Plan
Corporate Marketing
- Order Flow
Corporate Marketing
- eStore
Review
& OK
Project
Plan
Develop eStore
Resource and
Project Plan
FRD = Functional Requirements Document
TRD = Technical Requirements Document
BOM = Bill of Materials
Review
FRD and
Approve
Project
Set up
Schedule
and
HomePage
Create
TRD
Response
Incorporate
TRD
Feedback from
Stakeholders
Engineering
Creates
Project Plan
QA
Develops
Test Plan
Step 4. People: Develop joint
responsibilities—”T-shaped”
T-shaped managers excel in the dual task of delivering performance for their own
unit (the vertical part of the T) and contributing to other units by helping, sharing
knowledge, and coordinating work (the horizontal part of the T)
Management levers to
develop effective
collaboration
• E.g., processes
Management levers to
create unit performance
• Clear responsibilities and targets
• Accountability
Cross unit collaboration
Unit
focus
Levers emphasizing
duality
• E.g., evaluation and
promotion criteria
including both
dimensions