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Would You Recommend Us?

That simple query to customers is shaking up planning and executive pay

It wasn't exactly Thomas Edison and the lightbulb, but for Peter McCabe, it was a eureka moment all the same. In the fall of 2004, McCabe, chief quality officer for General Electric Co.'s (GE ) health-care business, read a Harvard Business Review article recommended by a colleague. It suggested companies measure customer loyalty by asking one simple question rather than relying on lengthy satisfaction surveys: "On a scale of zero to 10, how likely is it that you would recommend us to your friends or colleagues?"

The article showed that "net promoter scores," which measure the difference between the percentage of customers who give high responses ("promoters") and those who give low ones ("detractors"), correlate closely with a company's revenue growth. Promoters are defined as customers who give the company 9 or 10, while detractors hand out "0" through 6. Customers who log 7 or 8 are deemed "passively satisfied" and aren't calculated in the final score. The article's finding stopped McCabe in his tracks. "Wow, this is kind of perfect," he thought.