Category Archives: General

Congratulations to the Winners of 2017 Young Scholar Research Competition

The Arizona State University Center for Services Leadership and the Co-Chairs of the Third Annual Organizational Frontline Symposium (February 2017) are pleased to announce the awards for 2017 Young Scholar Research Competition.

The competition accepted research proposals focused upon ‘frontline’ topics, and the lead author was required to be either a current doctoral student or an assistant professor who is fewer than three years removed from graduation. Twenty submissions were received and evaluated by an expert panel of judges.

The awarded projects include (in alphabetical order):

corinne-kelley

Corinne Kelley, Florida State University, “The Ambassador Effect: A Frontline Tactic to Enhance Customer Commitment, Loyalty, and Prosocial Behavior

Advisors: Maura Scott and Martin Mende

 

blake-runnals

Blake Runnalls, Michigan State University, “The Impact of Social Networks on Sales Training Transfer and Performance

Advisor: Doug Hughes

 

sunil-singh

Sunil Singh, University of Missouri, “Email B2B Sales Negotiation: Dynamic Use of Textual Cues as Influence Strategies

Advisor: Detelina Marinova

 

We congratulate the winners of the 2017 Young Scholar Research Competition and wish the award recipients and all the applicants the best with their research projects!

Join the CSL for our Strategic Service Institute

The Center for Services Leadership is continuing its role as a leader in service education with the announcement of the Strategic Service Institute (SSI), March 13-17, 2017. SSI is the only program that provides an immersive executive education experience that focuses on the delivery of service excellence.  The development of this new format is the next evolution of service education. Two modules are now offered, one that delivers the foundational essentials for the managerial knowledge of service delivery and execution and a second that provides cutting edge toolsets and strategies essential to taking an organization’s service excellence to the next level.  An individual may take either one, or both, of these modules.

Grant OlsenDr. Douglas Olsen, Academic Director of SSI, explains advantages of the new format, “we provide incredibly solid grounding in service excellence during the first module and then, with these foundational principles in place, in the second module we introduce key frameworks for implementing strategies for leading service-centric organizations. Throughout the program we create opportunities for engaged discussion and collaborative learning.” The Institute curriculum is led by academics and business practitioners who are at the vanguard of service, and is delivered in a university environment at McCord Hall, of the W. P. Carey School of Business, Arizona State University.

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If you are interested in learning more about SSI and would like to register, please see our website.

 

Driving Business Value from Digital Transformation

Webinar with Dr. Michael Wade, Professor of Innovation and Strategy and Cisco Chair in Digital Business Transformation, at IMD Business School, located in Lausanne, Switzerland and Director of the Global Center for Digital Business Transformation, an IMD and Cisco Initiative

Author of Digital Vortex: How Today’s Market Leaders Can Beat Disruptive Competitors at Their Own Game

This webinar was hosted by the Center for Services Leadership Community of Practice on Monetizing Data and Analytics

The Digital Landscape has changed over the past decade. While businesses and companies understand the power of digital innovation, many firms struggle with either taking advantage of the opportunities or reducing risks that accompany digital transformation. Automotive industry is a great example that demonstrates the impact of digital transformation. The push for development of autonomous cars affects a wide spectrum of industries: from transportation & logistics to insurance, law & order, healthcare, hotels etc. Similarly, other innovations such as block-chains, machine learning, virtual reality etc. will potentially have an impact on a number of industries.

While leading digital transformation, companies have to address two fundamental questions: “Why” and “How”. ‘Why’ pertains to understanding the opportunities and threats that exist because of a rapid digitization. “How” covers the capabilities and roadmaps traditional companies need to create to sustain competitive advantage. Yet, data suggests that most digital transformations fail – the reason lies in inability to push for organizational transformation alongside technology transformations.

Beyond technology, companies need to change their approach to business strategy. According to conventional thinking, strategies are developed with a clear understanding of where the company currently is and where it wants to be. However, in today’s world, predicting the future has become extremely complex. Instead, to compete in digitally disruptive environments, companies must build multiple strategies backed by core digital business agility. The following capabilities are key to building digital business agility:

  • Hyperawareness
  • Informed Decision-Making
  • Fast Execution

Hyperawareness is being fully alert to the internal & external environments, particularly to changes that spotlight opportunities or risks. Data & information collection are the core for this principle, which can be accessed by humans, IoT machines or sensors. Key metrics to measure hyperawareness include the company’s ability to capture insights about/from its employees, customers, partners internal operating environment, competitors and about new digital technology & business trends.

Informed decision-making pertains to collaborating & empowering people to make quick, evidence-based decisions. Decision making power needs to be pushed to the edge of the network (Intelligence at the Edge) to gain speed & accuracy. Informed decision making is measured by the business’s ability to make decisions quickly & based on analytics, to empower people, to share information across organization and to access & display important data in real-time.

Finally, fast execution is putting decision into practice rapidly, mobilizing resources dynamically and continuously monitoring options and progress against goals. Fast execution is measured by our ability to act quickly based on new information, turn decisions into actions, dynamically acquire & allocate people & resources, continuously learn & adapt.

IMD’s digitization piano is one of the tools to help companies navigate the “how” of digital transformation. This tool breaks down the organization’s value chain into 10 distinct keys, broadly categorized under Digital Strategy, Digital Engagement & Digital Enablers. Companies should play multiple keys simultaneously instead of trying to address one specific area in isolation as they navigate their digital transformation journey.

Finally, at the core of transformation, the critical questions that companies must ask are:

  • How to use digital technologies to improve performance?
  • How to use digital technologies to build a more agile strategy?
  • How do we digitize across organizations?

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ABOUT THE SPEAKER

BACKGmichael_wadeROUND: Michael Wade is a Professor of Innovation and Strategy at IMD and holds the Cisco Chair in Digital Business Transformation. He is the Director of the Global Center for Digital Business Transformation, an IMD and Cisco Initiative. His areas of expertise relate to strategy, innovation, and digital transformation. Previously, he was the Academic Director of the Kellogg-Schulich Executive MBA Program in Canada. Michael has been nominated for teaching awards in the MBA, International MBA, and Executive MBA programs. He obtained HonoursBA, MBA and PhD degrees from the Richard Ivey School of Business, University of Western Ontario, Canada.

CLIENTS & INDUSTRY EXPERIENCE: At IMD, Michael teaches in several open programs and has directed partnership programs related to strategy and digital business transformation with Vodafone, Ooredoo, AXA, Honda, Zurich Financial Services, Credit Suisse, KONE, and Richemont, among others. He co-Directs IMD’s Orchestrating Winning Performance and Leading Digital Business Transformation programs. He provides consulting services, executive education and expert evaluations to several public and private sector organizations. He has lived and worked in Britain, Canada, Japan, Norway, and Costa Rica.

RESEARCH AND THOUGHT LEADERSHIP: Michael has published works on a variety of topics, including digital business transformation, innovation, social media marketing, information systems strategy, eCommerce, and SME performance. He has more than 50 articles and presentations to his credit in leading academic journals such as Strategic Management Journal, MIS Quarterly and the Communications of the ACM. One of his articles was among the top 20 cited articles in business, management and accounting worldwide for five years, according to Scopus (the largest abstract and citation database of peer-reviewed literature). He’s published eight books, more than twenty case studies and appears frequently in the mainstream media. His Latest book is Digital Vortex: How Today’s Market Leaders Can Beat Disruptive Competitors At Their Own Game. He was named one of the top ten digital thought leaders in Switzerland by Bilanzmagazine in October, 2016.

APPROACH “I define digital business transformation as organizational change through the use of digital technologies to materially improve performance. It is a simple definition, yet difficult to master. Certain industries have been on the vanguard of this changes. Other lag behind. Eventually, digital will become the ‘new normal’. I enjoy working with organizations to help them come to terms about what digital transformation means for them, and then to take appropriate action.”

The Moment of Truth: A Co-creation Perspective

The term “moment of truth” (MOT) is not new to me and I was happy to learn it was an integral part of the customer-experience community vocabulary.  As I have visited with many in the community, I’ve discovered there are various definitions for MOTs in relation to the customer journey. It is generally agreed that customer interactions are called “touchpoints,” and MOTs are the more significant touchpoints. However, the criteria for what’s “significant” depends on who you talk to. Some say the MOT is at the beginning when the customer decides to accept (or reject) the firm’s offer, while others point to the end of the transaction when they determine whether the whole experience was good or bad. Some identify various touchpoints where significant value is or is not realized. Yet another criteria is a touchpoint that shows the greatest likelihood the customer will “fall off”, or is most likely to end the business relationship. I contend there is too much ambiguity for the term to be useful in the context of a professional discussion.  At a minimum, the customer-experience community needs to agree on a more unified definition. I would go as far as to suggest a slightly different definition – one I think was intended by the first person to use the idiom in these contexts.

Richard Normann (1943-2003) is credited with the first use of the idiom “moment of truth” in a business context. Using the MOT concept, Normann was highly instrumental in the turnaround of Scandinavian Airlines (SAS) in the early 1980s. Jan Carlzon, SAS’s CEO during that time, recounts the turnaround in his book titled Moments of Truth (1987), attesting to the powerful perspective the MOT provides and Normann’s more significant contribution to the effort. By removing MOTs which provided little or no value to their customers, and enabling employees to deliver the best experience possible in those that remained, SAS became profitable again by more than three times the first year target.  They also earned the rank of “top Airline” the same year, and held that distinction for many years.

Normann’s book Service Management: Strategy and Leadership in Service Business, Third edition (2002) gives us the greatest insight to his thought process regarding MOTs. I find it fascinating and affirming that his first reference to MOTs is directly preceded by a discussion about co-creation. Normann says:

“…the customer is often more than just a customer – he is also a participant in the production of the service. A haircut, the cashing of a cheque, education – none of these can conceivably be produced without the participation of the consumer. Thus the service company not only has to get in contact with the consumers and to interact with them socially; it is also necessary to ‘manage’ them as part of the production force.”

Normann is clearly stating that a customer is integral to the value creation process. This is co-creation – the customer and the organization working together to create desired value.  If the customer is not involved, no value is ever created.  No customer, no value.

With this backdrop, Normann introduces the concept of MOTs. He states:

“Most services are the result of social acts which take place in direct contact between the customer and representatives of the service company. To take a metaphor from bullfighting, we could say that the perceived quality is realized at the moment of truth, when the service provider and the service customer confront one another in the arena. At that moment they are very much their own. What happens then can no longer be directly influenced by the company. It is the skill, the motivation and the tools employed by the firm’s representative and the expectations and behavior of the client which together will create the service delivery process. A large service company may well experience tens of thousands of ‘moments of truth’ every day.”

From the very first mention, Normann is clear that when a customer comes into contact with the organization, it is a MOT. The two have come together to accomplish something in relation to creating the value the customer seeks – their job-to-be-done. We know from experience there are often many interactions per customer journey depending on the size of the job-to-be-done.

We also know customers judge the experience of each and every interaction as to perceived quality in relation to its part of accomplishing “the service delivery process”.  Customers have some idea of how much time and effort they should be expending. They have some expectation of how they should feel at a particular point in the process, and they judge the interaction based on whether their expectations were met. The quality of each and every interaction is determined and (either consciously or subconsciously) scored in the mind of the customer. Think of this as a “running score.”

When Normann first introduced the MOT concept, most interactions were face-to-face; but don’t take this too literally.  As technology emerged and matured, Normann realized the potential for applying technology to MOTs.  He says, “…new communication and information technology clearly increase the possibilities to ‘store services’, and to make person-to-person interaction in their provision unnecessary.” Customers understand that automation is still designed and implemented by “faces” in the organization.

Normann also talked about the cumulative and/or knock-on effects of MOTs:

“There is a well-known dynamic in interpersonal interactions whereby positive action creates positive reactions, which in turn leads to mutually positive feelings which in turn leads to mutually positive interaction. Or the reverse can apply. A positive attitude and efficient action on the part of the service supplier will encourage the client to participate more, and more effectively, which in turn encourages the service supplier, and so on. A ‘virtuous circle’ has started.”

Normann continues at length to point out when the interactions are positive and customers feel the experience is valuable, a “virtuous circle” ensues.  Furthermore, the outcome of each interaction or MOT sets up the likelihood of a similar outcome at the next interaction. Good interactions tend to foster more good interactions, while poor interactions tend to lead to yet poorer interactions.

Perhaps Normann is the clearest in defining the MOT when he said:

“The quality experienced by the customer is created at the moment of truth, when the service provider and the client meet in a face-to-face interaction. The most perfectly designed and engineered service delivery system will fail until things work out then. Thus, any enquiry into quality must start from the microsituation of client interaction, the moment of truth (emphasis mine). The important question is: what mechanisms lead to and reinforce the client’s experience of quality and good value in that microsituation?”

In defining what Normann meant by the ‘moment of truth’, focus on the most consistent and defining vocabulary he used throughout: the words “interaction” (used consistently) and “microsituation” (used specifically), and more importantly, the juxtaposition of the two – “microsituation of client interaction.” From my reading of Normann, MOTs are each individual interaction with the customer – not high-value interactions, not high-risk interactions, not just the buy/no-buy interaction, and not the last interaction, which are all macrosituations.

The organization typically dictates the customer’s journey, and therefore, determines the time and effort required from customers. Unfortunately many organizations tend to think of some interactions as trivial and inconsequential. All too often, what the organization considers innocuous, the customer perceives as a waste of time and resources. Furthermore, the cumulative or knock-on effects of multiple or poorly executed interactions could culminate at a relatively innocuous one – the proverbial straw that broke the camel’s back.

From a co-creation perspective, each interaction either increases or reduces value to the customer. In other words, that running score really matters. Is every interaction equal to another? Absolutely not, but they are all weighty! We need to consider each and every interaction and what it contributes to customer value in relation to all other interactions.

Therefore, a co-creation perspective takes into account the value exchange of each and every interaction with a customer.  As the customers navigate their journey, moment by moment they are sizing up how they feel about the potential of achieving overall success, and with a few exceptions, they can drop out at any interaction in the journey. Though the organization may identify a particular interaction in which customers typically drop out of the journey, this doesn’t necessarily indicate that interaction is the culprit. The root problem is just as likely to be poor execution of one or more upstream interactions. The customer journey is part of the co-creation ecosystem and systems thinking needs to be applied.

Please keep in mind my purpose is first: to create a better and more common understanding in our terminology, and second: help us leverage the brilliance of Normann’s work. I’m not necessarily suggesting the customer-experience community change its vocabulary. However, I do recommend we at least apply Normann’s research and concepts to whatever the corresponding vocabulary is. Every organization’s success depends on creating Normann’s “virtuous circles”, yet these are only possible when we acknowledge the full significance of what he called the MOT with their cumulative, knock-on effect in the co-creation ecosystem. Call them what you will, interactions, touchpoints or MOTs, but for the good of the customer give every single one their due consideration.

Compete Through Service Symposium 2016: Recap in Pictures

Thank you to everyone who attend this year’s CTS Symposium! Save the date for next year’s symposium: October 25 – October 27, 2017. We hope to see you next year!

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Customer Success: The Next Evolution of Customer Service

By James “Alex” Alexander

Whether you are a traditional on-premise supplier or a cloud-based subscription business, “customer success” is where the big dogs play.

What is customer success?

“Customer success” is a term bantered about in boardrooms and breakrooms in different ways. It has been perceived as a business model, a company-wide priority, an organization, a profession, or a technology.[1]

Research for my recent study, “Customer Success: Managing the Customer Experience for Loyalty and Profit,” [2] confirmed this disparity—the definitions given regarding customer success and customer success management were as varied as Mexican chilies at Santa Fe’s Saturday farmers’ market.

Customer success is a strategy and a philosophy. It is a way of approaching how you interact with your customers and your marketplace. But an important understanding is that customer success is personal. Just as kids in a candy store might prefer different treats, each customer may value certain outcomes more highly than others at a given point in time, and hence, customer success varies from person to person. So I prefer a concrete, actionable definition.

Customer success is a customer state of mind in which a specific customer (let’s call her a key player) feels that she has achieved her desires (business outcomes and personal wins) while undergoing brilliant customer experiences. Here are definitions of the three requirements of customer success:

  • Business outcomes. The results that a key player hopes her organization will get from purchasing and using a supplier’s offerings such as increased revenue, lowered downtime or enhanced productivity.
  • Personal wins. The results that a key player hopes will happen directly to her from purchasing, using a supplier’s offerings or both. This could be job security, personal recognition or less job hassle.
  • Customer experience. The customer’s perception of a supplier’s performance, including activities that do not directly touch the customer but that affect the customer’s overall view of the supplier. Brilliant customer experience occurs when the seven things that customers want, expect and deserve are met.[3]

Figure 1: Brilliant Customer Experiences Enable Customer Success

figure-1

 

The Brilliant Customer Success Performance Chain

For those of you serious about delivering success, I recommend using the Brilliant Customer Success Performance Chain as a guide, as Figure 2 shows. It is a robust model applicable to almost all organizations for planning, building, implementing, monitoring, diagnosing, and enhancing customer success results. I will start our discussion on the far right side of the chain and work backward.

Figure 2: Brilliant Customer Success Performance Chain

figure-2

 

Business Results

This is your reward for doing customer success right. Selfishly, your desired outcome as the supplier is business results. Yes, there can be a multitude of preferable outcomes, but for most organizations, there are two vital business results that trump all others: new streams of profitable growth to fund the future of the business, and brand dominance based on a reputation superior to your rivals’.

Customer Impact

Customer loyalty drives business results. Loads of research over the last several years show that the loyalty of your customers is a prime driver of the business results discussed above and outlined in Figure 3. There is a direct relationship. Loyal customers buy more and more, again and again, rarely quibbling over price.[4]

 

Figure 3: Customer Impact Drives Supplier Business Results

figure-3

 

Emotionally, loyal customers tout your attributes far and wide and gladly provide testimonials to woo your prospects for you. Loyal customers are the crown jewels of your resources and should be guarded as a miser would a strongbox. If we embrace the eminent management consultant Peter Drucker’s declaration in Management: Tasks, Responsibilities, Practices that the purpose of a business is to get and grow customers, customer loyalty is the secret sauce of the recipe.[5]

Customer success drives customer loyalty. As discussed, to earn that loyalty, you must deliver customer success as each key player in the customer account defines it.

Brilliant customer experiences enable customer success. The promise of customer success requires brilliant customer experiences. Like the catalyst in a chemical reaction, a brilliant customer experience releases the full potential of a supplier-customer relationship. Customer experience is shaped at every touchpoint—every encounter or contact the customer has with your organization.

Touchpoint Management

Brilliant employee performances drive brilliant customer experiences. The more closely your people give the customer what they need, want, and expect at each step in the decision-making process, the more powerful the moment of truth, and the more likely the customer will invite you to participate in the next decision step. Figure 4 shows the progress from touchpoint management to business results.

Figure 4: Touchpoint Management Effects on Business Results

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Capable and loyal employees are required to deliver brilliant employee performances. Your frontline personnel must have the capabilities needed to interact with the customer the right way at the right time.

Figure 5 shows how performance systems provide the information and tools required to help your capable and loyal employees in their moments of truth.

Figure 5: How Performance Systems Affect Business Results

figure-5

 

Leadership drives the bus in creating a culture of success and in building and implementing a compelling blueprint to guide implementation, as shown in Figure 6. As we all know, if the big dogs don’t get off the porch, the pack doesn’t hunt.

Figure 6: How Leadership Can Build a Culture of Success

figure-6

 

Leading the Pack

Customer success is much more than the latest marketing mantra…it is a strategy, a philosophy, a way of doing business. It can make your customer more successful, your company more successful, and hopefully, you will be more successful. Act like the big dog you are and lead the customer success pack!

 

Note: This article was adapted from Alex’s new book Brilliant Customer Success: Managing the Customer Experience for Profitable Growth and Brand Dominance, due to be released in November 2016.

 

References

[1] “An Executive Primer to Customer Success Management.” April 2014. Thought Leadership Paper. Forrester.

[2] Alexander, James A., EdD. 2016. Customer Success: Managing the Customer Experience for Loyalty and Profit. Alexander Consulting and Service Strategies Corporation.

[3] Alexander, James A., EdD. January 26, 2015. “Brilliant CX: The 7 Things Your Customers Want, Expect, and Deserve.” LinkedIn Blog.

[4] Mehta, Nick. October 18, 2015. “The 5 Kinds of Customer Success.” Gainsight, Venturebeat.

[5] Drucker, Peter F., 1974. Management: Tasks, Responsibilities, Practices. New York: Harper & Row.

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Join the Center for Services Leadership at Compete Through Services Symposium on October 27th, 2016, to hear James “Alex” Alexander, Alexander Consulting, speak on Customer Success Management: The Marvelous Opportunity to Grow Your Services Business.

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alexalexander

James “Alex” Alexander is founder of Alexander Consulting, a management consultancy that helps product companies build brilliant services. Contact him at 239-671-0740, alex@alexanderstrategists.com or visit www.brilliantcustomersuccess.com for information and valuable resources to speed your journey to brilliant customer success.

alex-book

 

Check out my new book!

BRILLIANT CUSTOMER SUCCESS

MANAGING THE CUSTOMER EXPERIENCE FOR PROFITABLE GROWTH AND BRAND DOMINANCE

by James “Alex” Alexander

 

Delivering an Effortless Customer Experience

In early September, I traveled with friends along the Dalmatian coast, enjoying the sunshine and lingering over cappuccinos late into the night. One evening at dinner, I couldn’t help but remark about the wonderful service at the restaurant. While it was the end of the busy tourist season, our waiter was amazingly attentive. He made it easy for us to order the right amount and variety of fish for the table, tailoring the offering to meet individual preferences. I suggested to my friend that I was surprised that although he knew he’d never see us again, he delivered exceptional service. A native, she told me that the customer was an integral part of the dining experience. For the business, ensuring customer satisfaction was as important as ensuring the quality of the food.

So how can companies everywhere deliver effortless, memorable experiences for its customers? How can they ensure that the service they deliver lives up to its brand promise?

It’s simple. The best companies deliver straightforward, reliable experiences that meet real needs. People want to interact with companies where doing business is personalized, easy and hassle free. Consider Starbucks, where you get a consistent experience and your morning jo customized for you no matter what city you are located in. Or Nordstrom, where you can link directly from Pinterest to their store to order the latest products that catch your eye.

Delivering an effortless experience begins with listening to your customers. It’s important to take the time to look at your business through the lens of your customers. This involves setting up multiple listening posts to capture different viewpoints. Most importantly, you need a robust system to capture and categorize that feedback in a manner in which your organization can easily act on it. At Verizon, we have a social media team that monitors posts across a wide variety of sites. The data they collect is analyzed using Clarabridge, a data analytics platform, that lets practitioners quickly identify trends.

Once you understand what matters to your customers, leveraging tools like Six Sigma makes it easy to effectively eliminate pain points. The goal of your process reengineering effort should be to create a simple and intuitive process for your customer. To coin an old phrase, “eliminate the small print”. If you have to explain the offer, it probably isn’t pain free.

Structured, data centric decision making is not only a powerful way to drive problem solving, it also helps align your stakeholders. Verizon found that it was easier to align its leaders when data formed the basis for the conversation.

Finally, successful businesses need alignment throughout their organizations. If the customer service organization isn’t prepared for the latest product offer, it can’t provide the training necessary for a successful launch. If the sales organization isn’t aware of what the marketing team is putting out into the market, it isn’t going to present a consistent message. So, in short, align your brand message internally before you take it external.

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Join the Center for Services Leadership at Compete Through Services Symposium on October 26th, 2016, to hear Carol Fink, Director of Executive Relations at Verizon, speak on Branding Your Customer Experience.

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carol-finkCarol Fink is Director of Executive Relations at Verizon.  In her current role, she has responsibility for voice of the customer analytics and process improvements across Verizon’s major businesses.  She holds a bachelor’s degree from the University of Michigan and a Master’s degree in Business from the University of South Florida.  She is a certified six sigma black belt, a certified work out planner and a “Playing to Win” strategy facilitator.  She leverages voice of the customer, employee engagement and six sigma principles to improve the customer experience.   Carol is based in Basking Ridge, NJ at Verizon’s corporate headquarters.  She is a member of the CXPA.