Will QuickBooks Be Your Accounting Software Next Year?

Larry Myler for Forbes writes:  I just got back from QuickBooks Connect, the first ever Intuit conference for the entire QuickBooks ecosystem , including small business owners, accountants and app developers. I attended the conference because I wanted to assess the relevance of this 30-year-old company in the age of the cloud. Given the current wave of disruption in the small business accounting space, the big question many are asking is: Will QuickBooks continue to be the dominant accounting software for the SMB market? Here’s what I found.

Desktop vs. Cloud and Mobile

Much of the recent disruption that has resulted in the overthrow of market leaders is generally due to a dominant player’s lack of ability, desire or urgency to disrupt itself before competitors can. The tech company graveyard is littered with the corpses of companies whose complacent and even clueless leaders stood idly by while hungry upstarts ate their lunch with cloud-based, mobile replacements of legacy applications. But Intuit has not been guilty of this kind of sluggish response to the SaaS phenomenon. It first launched the online version of QuickBooks in 2000, after a two-year development cycle. While the level of functionality was initially not on par with the desktop version, those discrepancies are almost all resolved, and several aspects of the online version now surpass desktop function. In 2009, Intuit doubled its online product investment, followed closely by heavy investments to make QuickBooks Online accessible on mobile devices.

Intuit’s Achilles’ heel in its transition from desktop to cloud is the inherent disadvantage of being the long-established leader. New competitors start with a clean slate while Intuit migrates from an older platform to a newer one. But Intuit has been here before—moving from DOS to Windows to IOS to mobile. Platform shifts should be a routine part of a technology company’s long-term strategy. So far, Intuit has managed these transitions well.

Many current and new users will be happy with the desktop version of QuickBooks for some time to come, and others will start with or migrate to the cloud. Intuit supports either choice. Tayloe Stansbury, Intuit’s CTO, is clear about his dedication to both current and future customers. “We will continue to offer desktop as long as there are users who want it—and we’ll continue to invest in it. That said, we’re committed to the enhanced collaboration, better workflow, and more frequent upgrades we can deliver to QuickBooks Online users.”

Earlier this year QuickBooks Online sales surpassed desktop sales for the first time, marking a new and probably permanent trend. Intuit has brand recognition, access to capital, and a sense of urgency, so it may be difficult to beat at the game it has played so well for so long.

While attending the conference in San Jose I observed other factors that may prove to be even more important to Intuit customers and prospects than the question of cloud or mobile access.

Customer-Centricity

Customer focus is paramount in the decision to buy from and stay with any vendor. Intuit CEO Brad Smith is quite passionate about why his company does what it does, and for him it’s all about the customer. He has a vision of customer outcomes that would transform the larger economy if realized, and he’s suggesting that QuickBooks can be a catalyst for that change. “If the average small business could raise their profit margin by just 2.5%, that would generate an extra $500 a month for every small business, and that would add over $300B directly to all of our local economies,” declares Smith. “If one out of three small businesses could hire just one more employee we would totally eliminate unemployment in the United States. And if we could increase the survival rate of small companies by 5% over the next decade we would see another quarter-million small businesses create 5M new jobs, and that’s more jobs than have been created in the entire economy over the last several years.”

Hmm. Making more money, growing, and staying in business…all outcomes entrepreneurs want , and Smith is wise to sell the hole and not the drill. Small business owners enjoy getting paid quickly, but don’t want to be bothered with the complexities of creating, sending and collecting invoices. They want to have a record year of sales without having to spend days documenting those activities for accountants. In short, owners want the benefits of entrepreneurship without the attendant accounting hassles. “Our goal is to make accounting invisible and painless for small business owners,” vows Smith. “And as a thirty-year-old startup, we’re just beginning.”  [snip]/ the article continues @ Forbes.com, click here to continue reading....