Since artificial intelligence (AI) has taken over every industry in recent years, businesses have had to quickly adapt in order to enhance and optimize operations and communications. This has allowed them to close the gap with their clients, particularly in the customer service sector where AI chatbots have proven to be quite successful.
Most likely, you have previously heard of AI applications like ChatGPT. While some may believe artificial intelligence to be some sort of gigantic robotic structure like to that of the Transformers, the truth is that AI is present everywhere, even in unexpected locations. In the modern world, using AI chatbot solutions has become so commonplace that we frequently fail to recognize that the devices we use and converse with are driven by artificial intelligence.
In this case, if companies keep implementing AI chatbot solutions into their operations, where does that position real human workers on the map? Is it possible to strike the correct balance between AI and human agents, particularly in the customer service sector where both effectiveness and a human touch are valued equally? Continue reading to learn more.
The rise of AI
When did artificial intelligence begin to truly take over people’s life on a regular basis, and where did it begin?
AI as a concept is not new. In reality, the idea of machines thinking and making decisions like humans was originally illustrated in a paper titled Computing Machinery and Intelligence by a young British polymath named Alan Turing in the 1950s.
AI had great success in machine learning and problem-solving from the 1950s to the 1970s. In the 1980s, the idea of “deep learning” was introduced into computers, enabling them to learn through experience.
When IBM’s Deep Blue, a chess-playing machine, defeated global chess champion Gary Kasparov in 1997, artificial intelligence was on a literal winning streak.
In 2006, social media platforms like Facebook, Twitter (now known as X), and Netflix began utilizing AI to curate material based on user behavior as a marketing and user experience (UX) tool. This marked the beginning of AI’s gradual integration into human life and business. The first widely used virtual assistant was developed by Apple in 2011 and is currently known as Siri.
By 2016, more and more organizations had created AI to replicate human interactions and behavior. The first robot citizen, Sophia, was developed by Hanson Robotics and had human-like features, the capacity to mimic emotions and speech. In a Stanford reading and comprehension test in 2018, an AI system developed by the Chinese internet company Alibaba outperformed humans in language processing.
Since the release of GPT-3 and other generative AI programs in 2020, as well as deep learning models that can produce any type of content that is identical to, superior to, or indistinguishable from human invention, artificial intelligence has gained widespread acceptance and adaptation. The efficiency that AI chatbots and virtual client representatives — also known as virtual consumer representatives — bring to the customer care industry has also helped businesses tremendously in recent years.
What does the customer service industry look like today?
Until just recently, businesses had no alternative to human agents for offering services, resolving complaints, processing orders, and providing necessary information about their products and services.
While many businesses assume those human agents are a cost center, quality customer service can often generate revenue. A study by SalesForce supports this statement, wherein 91% of respondents say that a positive customer service experience will incline them to make another purchase.
A company with good customer service can:
1. Improve customer retention and loyalty
2. Increase sales
3. Strengthen brand and identity
4. Attract new customers
Customer service plays a crucial role in being the face of the business. According to Fortune Business Insights, the customer experience management market size is valued at $14.95 billion in 2022 and is projected to increase to $52.54 billion by 2030. This projection was made based on the value of incorporating AI and Augmented Reality to enhance customer experience solutions.
The role of AI and chatbots in customer service
According to the U.S. Bureau of Labor Statistics, the U.S. had approximately 2,982,200 customer service representatives in 2022, which is projected to decline by 5% in the next 10 years.
Customer service is the world’s 5th most stressful job, leading to high levels of turnover and burnout. That, combined with the automation of AI customer service tasks, contributes to the continuous decline in human agents worldwide.
In the past, customers’ only option was to call human agents by phone for every minor and major inconvenience or information and patiently wait for a resolution — or end the call with no resolution at all. Aside from phone calls, customers can also email companies, which would take days, if not weeks, to receive a response.
Now with the rise of chatbots, businesses can provide better and more efficient customer service, especially regarding repetitive tasks and questions.
Chatbots serve as the initial interaction between a customer and the business, eliminating wasted time and enhancing customer satisfaction with instant support. As a replacement for human agents, chatbots are meant to communicate with customers at any time of the day.
Some of the types of chatbots include:
1. Button-based chatbots. Chatbots you can communicate with by pressing a predetermined set of buttons from a scripted menu that best fits your queries. This type simply operates like a decision tree and is most helpful for repetitive questions.
2. Rule-based chatbots. Chatbots operate based on a certain set of rules or keywords typed by the customer, much like a predefined Q&A.
3. AI-powered chatbots. AI-powered chatbots are a much more advanced version of rule-based chatbots. It is powered by NLP or natural language processing, machine learning, and deep learning to derive ideas from contextual information from the customer. AI chatbots have more flowy and human-like conversations than rule-based chatbots.
There’s no one-size-fits-all solution for businesses to use chatbot services. The type of chatbot a business needs depends on its scale, capacity, and the extent of customer support it wants to extend to its consumers,” says Jim Pendergast, Senior Vice President at altLINE Sobanco.
Will AI completely replace human agents?
According to a BBC report by investment bank Goldman Sachs, AI could replace 300 million full-time jobs, and the customer service industry is no exception. However, does this really spell the end for human agents?
The straightforward answer is No.
Despite all the automation and efficiency features of AI, an industry like customer service that thrives on effective and humanistic communication with its customers can never rule out real human agents.
Technology is still technology and is limited to whatever information its users, humans, feed it. What AI cannot do is build rapport or empathize with customers on a deeper level, which is a necessity in this industry.
Businesses can leverage both AI and human agents to create a more efficient yet still human-centered approach to customer service, targeting business pain points with a specific function for each, says Jesse Hanson, Content Manager at Online Solitaire & World of Card Games.
AI vs. human agents: A comparison
Now that we know that AI cannot completely replace human agents, it’s time we introduce how AI in customer service and human agents differ based on certain factors and situations:
AI Chatbots vs. Human Agents: A Side-by-Side Comparison
1. Response Time
AI Chatbots: Because they are designed to respond to basic questions right away, these chatbots are available around the clock.
Agents Humans: Unless shifts are scheduled, usually reply during business hours. This may cause delays for inquiries made outside of regular business hours.
2. Cost
AI Chatbots: Usually become more affordable with time. Monthly payments for plans vary from $1,000 to $10,000, contingent on plan intricacy.
Agents Humans: The average annual income is $37,780, plus extra for perks, education, and employee turnover.
3. Flexibility
Chatbots powered by AI: easily scalable, depending on business requirements, from simple rule-based models to fully customized AI systems.
Agents Humans: Scalability is more gradual and calls for ongoing skill development, training, and seminars.
4. Client-Side Method
AI Chatbots: Purport to offer direct, prompt responses, yet they are devoid of true compassion and emotional intelligence.
Human Agents: Possess a strong sense of empathy, a grasp of context, and a relatable, human-centered methodology.
5. Effectiveness
AI Chatbots: Constantly and without interruptions operate to offer service.
Agents Humans: may experience burnout and reduced productivity as a result of lengthy shifts and difficult client encounters.
Equilibrium Method:
There are specific responsibilities for both AI and human agents in customer support. According to Stephan Baldwin, the founder of assisted living, while AI chatbots are great for rapid, automated responses, human agents are necessary for intricate, compassionate exchanges.
Striking a balance between AI vs. human agents
It is important to acknowledge that in the customer service representative industry, where human agents are often stressed and overworked, AI is not a replacement for human agents but rather an augmentation for better employee productivity and efficient business operations, says the Head of Marketing.
IBM research, in particular, focuses on a discipline called Human-Centered AI (HCAI), emphasizing how AI should ‘amplify and augment’ rather than displace human agents. Rather than being replacements, there is a need for equitable collaboration between humans and AI to keep up with the modern world while also acknowledging the indispensability of human touch.
In this context, AI in the customer industry can augment business operations by:
1. Focusing on repetitive tasks like simple data pulling while leaving complex problem-solving tasks to human agents
2. Creating trend reports based on massive historical data, while human agents offer effective solutions based on data
3. Screening calls, emails, and queries and sending them to the best human agent for the concern
4. Helping in training human agents by simulating various customer scenarios
5. Accomplishing repetitive tasks that are the most stressful for human agents, to allow human agents to focus on core responsibilities and problem-solving tasks
Simply put, AI will be in charge of mundane tasks, sorting through massive amounts of information to draw results, graphs, and relevant data, and offer quick and easy solutions. On the other hand, human agents are tasked with complex decision-making involving nuanced understanding and emotional intelligence.
The synergy between AI and human agents can be compared to sociotechnical systems theory, wherein people and technology, infrastructure, goals, processes, and culture work together seamlessly for businesses to succeed.
The future of customer service
It is safe to say that the future of a good customer service team lies in the effective synergy between AI and human agents or the synergy between automation and human touch.
In particular, here are the possible futures of augmenting AI with human agents in the customer service industry:
Generative AI
We know of generative AI as ChatGPT, or image, sound, video, and content-producing platforms using AI.
With generative AI, businesses can incorporate conversational tools like ChatGPT into their customer service platforms. At the same time, generative AI can also generate personalized recommendations based on customer data and previous interactions to tailor to each customer’s concern.
Financial services
The role of AI and chatbots in the financial services industry is critical as they involve a lot of sensitive customer data.
One should not undermine how important privacy protection is when it comes to online transactions, says Volodymyr Shchegel, VP of Engineering at MacKeeper. Efficiency is necessary, but businesses and AI implementers need to see to it that no important information is compromised in the process.
Today, the financial sector is working towards better AI and chatbot customer service when it comes to:
.Checking of account balances
.Opening of new accounts
.Examining transaction history
.Bill reminders
.Make financial advice based on historical data
.Instant loan approvals
.Handle insurance claims
.Tax assistance
.Identifying fraudulent activities
Most chatbots’ and human agents’ role in the customer service industry today mainly revolves around handling transaction queries.
With several exceptions, most financing sectors are still reluctant to allow financial transactions through online conversations because of the rampant cases of online fraud and security breaches — -making it a challenge for the technology industry to work seamlessly with the finance sector on how to address such matters in the future.
Conclusion
Businesses need to recognize the major role of effective customer support in keeping customers engaged and loyal and attracting potential new markets. An effective customer service strategy should serve the best interests of its market, prevent potential bad PR, and strengthen its brand image while integrating modern technology and employee satisfaction.
In the same breath, we encourage businesses not to treat customer service as an either-or-matter between AI and human agents, as the role of each plays a crucial role in effective customer service strategy. Finding the right balance between technology and human touch is just as important as finding the balance between profit and expenses — both contributing to the overall performance of an organization.
Comments