Loudcloud Tackles Customer Satisfaction


MSP improves flexibility, accessibility, responsiveness


At the end of last year, Loudcloud issued a challenge to its fellow MSPs: Take us on in an independent customer satisfaction survey and you'll lose.

It was a boast that Loudcloud couldn't make back in May 2001 when an independent satisfaction survey of customers conducted by J.D. Power and Associates found that Loudcloud needed to clean up its act, particularly in flexibility, accessibility and responsiveness.

Since Loudcloud's inception, industry observers have commented on its seeming unwillingness to bend for customers. It was more than just a perception, however. Prior to August 2001, for example, customers typically had to buy Loudcloud's infrastructure, operations management and application management services as a single offering. The MSP now slices and dices its services at the application management layer.


Loudcloud's James Dimitriou saw a rise in customers' willingness to renew a contract with the MSP--from 83 percent in May 2001 to 94 percent in Novemeber 2001.

"Some customers had the perception that we had a cookie-cutter approach," said James Dimitriou, executive vice president of worldwide customer operations at Loudcloud. "We weren't saying, 'No, we can't do that', but we needed to be clearer as to what their options were and that we were trying to show them the best way to achieve what they were trying to do."

After implementing new programs, Loudcloud, based here, in just a few months was able to boost customer satisfaction ratings for responsiveness by 5 percent, accessibility by 12 percent and flexibility by 5 percent.

The improvements changed customers' willingness to renew a contract with Loudcloud from 83 percent in May to 94 percent in November, said Dimitriou. When asked if they would recommend Loudcloud to another business, the positive replies increased from 88 percent in May to 95 percent in November.

Responsiveness and accessibility showed the greatest improvement. The main issue was Loudcloud's reliance on outside parties to solve customer issues, which slowed resolution times.

The MSP introduced a new training regimen for call center staff and hired more hands-on experts in such areas as BEA Systems and Art Technology Group technologies to act as the front line,on-hand and on-call at all times,in its network operations center.

With the new staff and training, Loudcloud went from resolving only 40 percent to 45 percent of customers' issues in-house to solving 90 percent of customers' problems with its own staff.

Within six months the staff was responding to problems within 15 seconds and notifying customers of problems within 3.8 minutes.

Responsiveness to issues tied directly to another prickly point with customers,accessibility to Loudcloud's management and engineering team, Dimitriou said.

"We isolated our engineer team from customers because by nature they weren't a sociable group," Dimitriou said. "We needed to change that so we put the same engineers and manager in charge and in front of the customers until a project was brought live."

Loudcloud backed up its customer initiative with employee incentives for achieving certain customer satisfaction levels. Response and resolution times are also now backed by a service level agreement that Tier1 Research claims is one of the best in the industry.

James Cates, CIO of San Jose, Calif.-based Brocade Communications, said he's seen firsthand the improvements put in place by Loudcloud.

"Everyone is very accessible to me, and the service is very reliable," Cates said. "Without them I'd need a lot more head count for testing, but they handle that in a staging area so when something goes live it's reliable."

Cates said he would like to see Loudcloud address preintegration. Much of the integration of eight different application packages,such as the search engine and security engine,landed on his and his staff's shoulders, but he said Loudcloud assisted them throughout the process.