7. Rational Software

The offices at Rational Software have many of the trappings of a New Economy company.

The offices at Rational Software have many of the trappings of a New Economy company. There are pool tables, pingpong tables and video games for the code-slinging employees to use anytime.

Work hours are flexible, based on what the company calls "implied" core work hours of 10 a.m. to 3 p.m. Telecommuting is encouraged, and the company even pays for each employees personal high-speed Internet access.

While those things make Rational a good place to work, Matt Drazhel, director of Rationals Target Suites group, insists they arent what drive the companys 4,200 employees. Instead, "its having a great team of people to work with, and having work that makes an impact," he says.

"We understand what the mission of the company is," Drazhel says. "We know what we believe in, and we act upon it."

Rational makes tools for software developers, including software design and testing tools. The company also provides consulting services. "We are helping software developers in different industries develop software at higher levels, and do it faster and with better time to market," says Michael Messier, the companys vice president of human resources.

Founded in 1981, the publicly traded company has two main campuses, one in Cupertino, Calif., and the other in Lexington, Mass., plus three satellite offices. Since 1996, the companys annual revenue has more than tripled, and its headcount has been soaring. Over the last year, the number of employees has risen by 50 percent.

Despite its rapid growth, the company appears to be quite stable. Rationals co-founders Paul D. Levy and Michael T. Devlin are still with the company as chairman and CEO, respectively, and are the largest individual shareholders, controlling more than 3 percent of the outstanding stock.

Rationals stability has become a major selling point, particularly now that many dot-coms are imploding. With 13 consecutive quarters of record earnings, "people here feel they are working for a winner," Messier says. "All of them feel they are doing interesting work. People are charged up about what they do here."