The Art of Estimating

By Baselinemag Print this article Print

Tax season's finale brings a thundershower of cash—and it's Block that cleans up. But Intuit is grabbing the future.

The Art of Estimating

Many companies have predictable spikes in Internet traffic—retail companies in the weeks before holiday shopping seasons, news organizations during political elections, broadcasters during big sporting events. None, however, benefits more from such spikes than Intuit, since two-thirds of those visiting TurboTax for the Web are paying customers. (The other third—with incomes under $25,000—are permitted to use the Web product free as part of a public service program.) So it's especially useful to see how Intuit, with its motivation for estimating correctly, goes about the forecasting process.

What Intuit tries to divine—starting each August—is the maximum number of concurrent users who will be trying to access TurboTax for the Web the following April 15. The effort starts with staffers from product management and technical operations looking at the volume of the season gone by and using other data, including PC-penetration figures, to estimate the coming season's peak load. In the past, Intuit has found it takes about three months to buy the necessary hardware, configure it, and eradicate the bugs. "Most of our purchasing is just to accommodate customers for one day or two days out of the entire year," Meighan says. Intuit does in fact do a cost-benefit analysis to determine how many new computers to buy, but the decisions are based more on the lifetime value of a new customer than on the likelihood of a customer's being immediately profitable.

This article was originally published on 2002-05-01
eWeek eWeek

Have the latest technology news and resources emailed to you everyday.