Service Excellence Awards 2005: Overall winner and winner, Business to Business - Rackspace Managed Hosting Europe

Among the many wise words posted around the walls at Rackspace is a line attributed to Confucius. 'Get a job you enjoy and never work another day in your life,' it says. For the 65 souls (at the last count) working for Rackspace, it might - just might - be true.

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Last Updated: 31 Aug 2010

If you ask any schoolkids what they want to do when they grow up, it's unlikely they will answer 'deliver great customer service'. Yet such people exist in the adult world, as Rackspace proves. Somehow, it manages to find people for whom giving service is a real buzz, a kick - even a passion.

On the Rackspace packaging, it says 'Fanatical Support' and the people there seem determined to prove that they really do exactly what it says on the tin.

With the company doubling in size every year, finding these individuals is one of its biggest challenges. It's not down to luck. Rackspace's key recruitment tool is the Gallup Strength Finder, which has enabled it to identify the types who make successful Rackers ('achievers' and 'learners', mainly), and to find more of them. Every employee's photograph is posted on a board with a list of their five key strengths. The net is cast wide: employees come from 20 countries and speak 17 languages. Together, they own 80% of the firm; more than half earn over £34,000.

Rackspace is in the business of web hosting. Its target market is companies for which the website is mission-critical.

Uptime really matters to these customers and they need problems dealt with immediately. Rackspace customers know that if they experience downtime, they can call night or day and the phone will be picked up by a level-3 technician. Customer comments include: 'Rackspace gives me peace of mind', 'Rackspace makes me look good', and 'I can recommend them to anyone with confidence'.

This feedback is borne out by the data. In an industry-wide survey canvassing satisfaction with the leading hosting providers (including Colt Telecom, Energis, Pipex, BT Ignite and C&W), Rackspace came head and shoulders above its peers, scoring 9.29 for satisfaction against 7.73 for the runner-up.

Explains Matt Schatz, Rackspace's sales manager: 'Anyone can do what we do from a technical perspective. We buy Dell servers and so do our competitors. The one thing we do that is different is provide Fanatical Support - we know that 90% of our repeat purchase is directly attributable to our support.'

Rapid growth (sales up from £2.5 million to £12 million in two years) means that Rackspace has to evolve constantly. In the past year, it has created the new role of business development consultants, tasked to get closer to customers and anticipate their future needs. It harnesses improvements through a variety of initiatives, such as 'cut the crap' meetings and little black books issued to new employees to record their observations.

Deep-seated changes are driven by a change management organisation committee.

At Rackspace there are no doors, no secretaries and no discernible barriers to communication. Feedback is honest but 'often blunt'; the team spirit is exceptional, but there is no place to hide for those who are not truly committed. The rewards for working in this environment are many and various: from Guinness and oysters on St Patrick's Day to a plasma-screen TV for the employee of the year. But Rackers also want to give something back.

Their own committee raised £5,000 for a charitable trust last year, they visit local schools each week to help with reading and maths, provide e-mentors to local children, free hosting to a number of charity websites, and have set up a 100-day charity workbank.

But the beating heart of Rackspace is service, explains the MD, Dominic Monkhouse. 'My role is serving anyone in the organisation to help them do what they need to do. Everyone here serves everyone else with the ultimate aim of serving the customer.'

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