The tech secret weapon that sent customer-service satisfaction soaring

New IBM research reported 99% of organizations increased customer satisfaction and 96% exceeded, achieved, or expected to receive anticipated ROI, from a survey of 1,000+ organizations.

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Image: iStock/Panuwat Dangsungnoen

No matter how graciously good customer service is rendered, online reviews are more likely to cite "bad customer service," than the opposite. Problematic service will dominate reviews. People are more likely to angrily pen a disgruntled review than they are a positive one, and the latter acknowledgement can boost a business' morale and bring more people to their business. The coronavirus pandemic caused stress and anxiety among those who were overwhelmed as they faced unprecedented challenges, and sought help in navigating the technology necessitated by social distancing and isolation. Yet, there's a bright light at the end of the tunnel: Issues have been resolved by the judicious use of artificial intelligence (AI)-enabled chatbots and virtual agents, according to a new IBM report, "The value of virtual technology." 

SEE: COVID-19 workplace policy (TechRepublic Premium)

A survey of more than 1,005 respondents from 12 industries and 33 countries--conducted by IBM's Institute for Business Value (IBV) and Oxford Economics--discovered that 99% of organizations saw increased customer satisfaction, thanks to virtual agents; their human counterparts, customer-service agents' satisfaction with their jobs increased 20% on average. The success of virtual-agent technology (VAT) is reflected in the number of organizations that have exceeded, achieved, or expected to achieve its anticipated return on investment (ROI). Businesses that have deployed VAT reported an average revenue increase of 3%.

"The COVID-19 pandemic has rocketed virtual agent technology into hyperdrive," said Glenn Finch, global managing partner, cognitive business decision support, IBM Services.

The report explains that "Virtual agent technology refers to the deployment of automation that uses a combination of artificial intelligence (AI) technologies or capabilities like machine learning, natural language processing, natural language generation, sentiment analysis, language translation, speech-to-text, robotic process automation (RPA), and optical character

recognition (OCR) to automate dialogue, and in some cases, backend process steps, to serve end users." For a chatbot to qualify as VAT it must incorporate machine learning in addition to natural-language processing. Integrated voice response (IVR) systems only qualify as VAT when AI powers a conversational experience and the user is not limited to uttering a set of specific keywords."

IBM surveyed "more than 1,000 companies, spanning 12 industries and 33 countries, that have used virtual agents for just six months to over four years," Finch explained. "The study was vendor and technology agnostic, and focused on virtual agent technology performance, its impact on customers, employees and organizational financial results, and the factors that influence that performance and impact."

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Image: IBM

Get some satisfaction

Poor customer service produces decidedly different results, and the numbers on customers' satisfaction are negatively impacted. In other words, bad customer experiences are ranked high. But many in the enterprise hope that a closer examination of AI and advancements in natural language-processing will greatly help them and reduce negative perceptions of their business, based on encounters with customer service departments.

IBM has been a leader in the field, and since the beginning of the pandemic, Watson Assistant, IBM's AI-powered VAT has been adopted by organizations in 25 or more countries worldwide. Between February and August of this year, it has increased 65%. 

Companies using VAT now, Finch said, are Vodafone, RBS, and TSB.

The goal for businesses is to use AI to assist employees and for customers to gain secure and quick access to trusted information.

VAT assessment had been limited to individual case studies, which was too challenging for organizations "to derive meaningful comparisons," the report stated. Respondents were asked the following key questions:

  • How efficient is AI-enabled VAT?
  • What are the key attributes and practices that drive value from VAT?
  • What is the impact of AI-enabled VAT on customers, end users, and human agents?
  • What impact does VAT have on organizations' financial performance? 

The data the company gathered found VAT was a positive influence "on nearly every measure, including customer satisfaction, employee satisfaction, and revenue."

VAT pioneers classified three different critical attributes directly influenced by leaders: Early adoption of VAT, large proportion of inbound contacts within the scope of VAT, and a high-degree of integration between VAT and backend systems. VAT leaders outperform peers in three areas: Intent recognition (80% vs. 66%), containment (75% vs. 62%), and first-contact resolution (74% vs. 63%).

Conversely, human agents, supported by agent-assist VAT revealed a median of 65% and a 75% benchmark; for in-scope segment, the median is 62% and the benchmark is 70%.

Key takeaways from the data: Significant customer, agent, and financial benefits; meeting and beating expectations; rising to the challenge in the time of COVID-19.

Reasons to implement VAT

The study looked at the most important reasons and "all reasons" for leaders and "others," to adopt VAT. 

Percentages were broken down as customer experience, improve brand differentiation, improve human agent experience, reduce cost, and increase revenue.

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Image: IBM

VAT showed a big impact on customer satisfaction: 73% of leaders said it had a "significantly positive impact," 25% said a "somewhat positive impact" and only 2% said "neutral." 

VAT deployment

One of the world's first telecommunications companies to adopt VAT for customer service is the Vodafone Group, and the company's AI-based digital assistant is TOBi, available throughout the UK, Europe, Africa, and the Middle East. 

TOBi is a central, modular platform to connect channels, SMS, the My Vodafone app, local Vodafone homepages, Facebook, WhatsApp, and Amazon Alexa. Vodafone customers messaging-versus-calling the call center has almost doubled. In Italy, two-thirds of customer contacts are contained through TOBi.

The revenue impact of using VAT

Revenue has increased 3%, cost has been reduced by 18%, customer satisfaction has increased 12%, human agent handling time has been reduced by 15%, first-contact resolution is up 14%, full-time employees (FTEs) handling inbound contacts has been reduced 18%, and net promoter score (NPS) is up five points, the report said.

Leaders who invested in VAT prior to and during the COVID-19 crisis were able to leverage the benefits of VAT, as well as reap the benefits, the report said. Almost half of the leaders who focused on VAT expansion and enhancement during the pandemic reported a "significant" increase for intent recognition, compared with 23% of "others." Leaders also saw significant bumps in agent satisfaction, as well as 70% customer satisfaction.

How to get started with VAT

Getting started with VAT, the report recommended: Go with your eyes wide open, conduct a business value assessment, establish a center of excellence; for those mid-journey, it said: Work to provide a consistently excellent experience, stay the course, and establish a governance program.

Finch explained that IBM took what it learned from the "105 VAT pioneers" and applied it to deploying VAT:

  • Maximize your business value
  • Consider the services required to support the change
  • Stay the course and prepare
  • Start with the end in mind

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