Making the Case for an Intelligent Virtual Agent
June 27, 2022
By Donna Fluss
Self-service has become the preferred form of customer support for many consumers, so long as it works. So it should be simple for enterprises to give customers what they want, particularly because it’s also highly beneficial for employees and the bottom line. The challenge is that many companies successfully using interactive voice response (IVR) solutions to displace a large percentage of contact center calls don’t yet appreciate the greater potential value of intelligent virtual agents (IVAs).
IVAs are not next-generation IVRs. Referred to as conversational artificial intelligence (AI), an IVA is a system that uses AI, machine learning, advanced speech technologies, deep neural networks, and predictive analytics to simulate live and unstructured cognitive conversations for voice, text, or digital interactions, generally via a digital persona. One of the many advantages of IVAs is that they can learn continuously based on data inputs from each new interaction, assimilating the acquired knowledge and leveraging it in future interactions. These external-facing self-service solutions invite customers to speak or write their requests using natural language, just like we speak or write to human agents, as opposed to requiring customers to select or speak the options they want from a limited menu, spoken by an IVR.
It’s Time to Replace Your IVR with an IVA
IVRs have done a magnificent job of automating from 20 percent to 85 percent of customer phone calls for many contact centers during the past four decades, but the time has come for these menu-driven solutions to be retired. Today’s customers want to find answers and complete transactions on their own in digital and voice channels, and they expect it to be easy. Enterprises need self-service solutions to do more for them as their call volumes grow and finding and retaining qualified agents and customer service reps becomes more difficult and expensive. Contact centers want low-code/no-code self-service solutions that enable service, sales, and collections organizations to build, maintain, and enhance their solutions without relying on IT. And companies are looking for self-service solutions that can be designed once and rolled out across a variety of voice and digital channels, including calls, chat, messaging apps, short message service (SMS)/text, and more.
Building a Business Case for an IVA
The most effective way to get approval for an AI-enabled IVA is to build a business case that shows a payback of 12 months or less from the date of implementation. It costs approximately $3.50 to $6 for a three-minute call handled by a live agent (and this cost is rising along with agent salaries), so when a company that handles 200,000 live calls a day can increase its displacement rate by as little as 2 percent, it can see savings of $14,000 to $24,000 per day or $280,000 to $480,000 per month. As IVAs can and should be implemented in digital channels, something that most companies are not doing today, the additional savings should be significant for organizations of all sizes.
IVAs contribute to both “hard” (quantifiable) and “soft” (qualitative) savings categories, but chief financial officers are typically willing to accept only hard benefits, so these are what should be used when building the business case—things like greater volume of calls displaced, automated handling of digital inquiries, and reduced average handling time. The financial justification is based on reducing the number of live agents, but this doesn’t mean having to fire agents or other employees. Given the agent attrition and hiring challenges that most contact centers and customer service departments are experiencing due to the Great Resignation, employing IVAs may provide the best chance of meeting service-level objectives. And these solutions deliver many soft benefits to operating environments, as they build agent engagement and improve retention by automating basic (and to agents, unfulfilling) tasks such as verifying orders, activating products, and scheduling appointments.
IVR solutions have had an amazing run, but it’s time to retire them. The vast majority of IVRs are using outdated scripts and/or voice user interfaces, many of which have been in place for close to a decade because it is time-consuming and costly to update them. IVAs enable customers and prospects to help themselves, and in doing so, they reduce operating expenses while enhancing the employee experience. These conversational, AI-enabled solutions are essential for the success of contact centers and service organizations of all sizes.