The highlight of last week for me was a conference call with the managers of a small specialty retail chain. These stores (which are actually owned by a much larger corporation) are attempting to completely reinvent how business is done in their space.

I don’t know what tickles me more; The vigor with which these guys are approaching this mission or the fact that they’re acting like a scrappy start-up even though they’re a part of a billion dollar organization.

One thing I do know is that everyone on that team has their game face on. They’re trying new things and working really hard at dialing-in a formula for a successful new business. On this week’s call we heard energy, commitment and a little bit of swagger there I didn’t mind hearing at all.

Customerville has had the pleasure of working with this company to measure the customer experience in these exciting new stores. The reason for our call this week was to try and divine from their customer grades what’s working in their new store format and what is not.

Just a few minutes into the call we realized that there was something missing. These managers all knew what their grades were, but they didn’t know what they meant. Put another way, in an area of the business where they were receiving a 4 out of 5, for instance, they thought this was good.

What hadn’t been communicated to the guys on last week’s call was a clear definition of what a good grade really is. The fact is, anything below a 4.5 on a five-point scale is flat unacceptable.

The grades a company’s customers will give it are a very good predictor of sales growth. Companies which get nearly perfect grades on a consistent basis are highly likely to have strong same-store sales numbers. Conversely, companies with low grades tend to struggle to even make last year’s numbers. Their marketing dollars are wasted just replacing attrition, rather than building the business.

The good news is that improvements on customer grades over about a 4.5 tend to have a magnifying effect on sales. These organizations create loyal customers who return consistently and bring their friends with them. Any company’s objective should be to measure their performance on the things that count and not quit until they’re in the high 4’s on a five-point scale.

Once the guys on the call all clearly understood that their goal was to get grades of 4.5 or better — and why this was important — everything changed. They’ll carry this understanding into the coming weeks by using this knowledge to fire up their own store teams to perform with customers in a way that really moves the needle. We look forward to seeing those sales follow.