When you set out to build one of the world’s greatest service companies like we have, you can’t help but become a fan of other companies with great service.

That’s why I love BusinessWeek’s annual Customer Service awards for companies with more than $1B annual revenue. It showcases companies that prove that you can build a large, profitable business without abandoning the Golden Rule – treat your customers the way you would want to be treated.This year the list was topped by USAA. We’re pretty excited for them, as they are just down the street from us here in San Antonio. Here are the top five:

1. USAA
2. L.L. Bean
3. Fairmont Hotels and Resorts
4. Lexus
5. Trader Joe’s

You can see the rest of the list here.

We’re not eligible for the BusinessWeek award, but it’s encouraging for us to know that very large businesses can maintain their service-focused cultures even as they have grown over the years

I had to call my cable company last week to sort out an issue with our service. When I called the support number, I was greeted by a machine.

“Thank you for calling ___________. Your call is very important to us. To pay your bill, please press 1. For new service, please press 2. For all other options, please press 3.”

If this sounds familiar, then you have probably experienced an Integrated Voice Response system (or IVR for short). IVRs are primarily used for one reason – they are much cheaper than a human. IVRs are becoming so common that people are often surprised to hear a human voice when they call us.

We think the little bit of cost savings from an IVR are more than offset by an increase in customer defection. Humans are more expensive, but much more reliable and much, much easier to talk to.

(read more…)

Today, I‘m in Los Angeles for the Microsoft launch of Windows Server 2008. With this launch, our Windows customers will now have the option to continue to deploy on Windows Server 2003 or possibly on the new Windows Server 2008. Rackspace is making Windows Server 2008 available on the same day Microsoft launches it to the public, but there are a few limitations until all of our vendors catch up with production drivers. If you’re a customer, you can check with your account team for the specifics.

Windows Server 2008 improves upon so many areas, but the most exciting features for Rackspace are in the new IIS 7.0.

Here are just few of the improvements to IIS: (read more…)

No matter what business you’re in, having the right employees on board in the right seats can mean the difference between being an average company and a great company. We’ve found this to be especially true in a service-delivery business like Rackspace, and finding the right Rackers (Rackspace employees) has been one of our biggest challenges since the early years of the company. 

For the first year of the company, I can think of numerous occasions when we had thought we found the perfect candidate for a role. He’d be extremely technically proficient in his area (whether it is was Linux system administration, tax accounting, or software development) but the person just didn’t seem to work out as a Racker. While the candidate could be a rock star in a lot of companies, he just didn’t seem to fit in our unique environment. It turned out that the entire process was focused purely on making sure that the prospect had the technical skills necessary for the job in question. While that was important, it really only told part of the story.

Without understanding how a candidate collaborates with his peers and subordinates as well as what a candidate is naturally passionate about, it is really impossible to tell if a candidate will fit in your company. And in our case specifically, it was critical for the candidate to be able and WILLING to talk to customers and have a genuine concern about solving their problems…whether it was an external customer or an internal customer. In fact, the candidate really needed to have a value system that was very consistent with the value system of the company. So while our interview process was more than adequate for testing technical knowledge, it was sorely lacking in its ability to uncover the candidate’s value set so we could see if it was consistent with our value set and our culture. 

Once we realized this, of course we set out to change the way we selected Rackers to ensure we learned during the interview process what values really drove a candidate. It turns out, however, that there aren’t 10 simple questions you can ask to discover if some one naturally shares your value system. Think about the dating process. You don’t decide to get married after the first date (at least not usually). You don’t decide after the second date either. In fact it sometimes takes months or years of dating before you decide to get married. The whole dating process is about really getting to know someone. To learn about that person and discover if that person is compatible with you, your family, your friends, and your value system. Interviewing a candidate has many of the same characteristics. The only problem is that you don’t get to have a long courting process…in fact, taking more than two weeks is often too long to successfully win a candidate. (read more…)

When we launched our new brand in January, we proclaimed our category to be IT Hosting. We have gotten several customers asking what we mean by this shift. Do we intend to change our business? Are we getting away from our core offer? What does this mean for customers?

The shift was basically a response to where our customers are taking us. Let me explain.

Hosting as an industry was started due to the simple fact that businesses needed to put their websites near big IP pipes. It was not possible to bring enough reliable bandwidth to your office for your site, so going to the network really created the industry. For the first time, IT shops had applications outside their LAN and outside their property being consumed by people all over the world.

Well, a bunch of things have happened since that time. Applications are becoming web based. The world is more global, meaning employees and suppliers are scattered everywhere. Server and data center needs, even for small companies, have mushroomed. With all this happening, many of our customers have turned to us. “Please run all our servers.” “Take my mail…please.” Customers realize they can buy computing and basic IT as a service much easier than building and operating it themselves.

What does all this mean for our offers to our customers? (read more…)

A new year, a new logo, a new blog…a higher commitment to Fanatical Support! We want to officially welcome everyone to Rackspace’s blog. We’d like to quickly give you our two cents on all the changes this year brings for us, including our shift from Managed Hosting to IT Hosting.

Managed Hosting is still at our core, but we’ve always been about service first. Now we’re being more vocal and visible about our service advantage because we realize companies need more than just a web server; they need managed solutions such as email (that’s where our mail division Mailtrust comes in), utility computing (enter Mosso), virtualization and more; basically anything to lower internal IT costs and heartache, that’s where we come in. Best of all, it’s all backed by our award winning Fanatical Support!

Our hope is that this blog will give you a more in-depth look at the inner workings and thinking of the people we have working at Rackspace. We will cover topics ranging from latest and greatest technologies and industry trends, to unique Rackspace business practices that we hope you’ll find interesting and possibly useful for your business.

Read on and let us know what you think!