AI revolutionizes call centers; humans are still better at some tasks.

NEW YORK—Armen Kirakosian recalls the frustrations of his first job as a call center agent nearly a decade ago: irritated customers, constantly searching through menus for information, and the notes he had to physically type for every call he handled.

Thanks to artificial intelligence, this 29-year-old from Athens, Greece, no longer types notes or clicks through countless menus. He often has complete customer profiles in front of him when a person calls, and he may already know what problem the customer is having before even saying "hello." He can spend more time actually serving the customer.

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“AI has brought the robot out of us,” says Kirakosian.

Approximately 3 million Americans work in call center jobs, and millions more work in call centers around the world, answering billions of inquiries a year about everything from broken iPhones to shoe orders. Kirakosian works for TTEC, a company that provides third-party customer service lines in 22 countries to companies in industries such as automobiles and banking that need additional capacity or have outsourced their call center operations.

Answering these calls can be a thankless job. Approximately half of all customer service agents leave after a year, according to McKinsey, with stress and monotonous work among the reasons they quit.

Much of what these agents handle is known in the industry as "break/fix," meaning something is broken, wrong, or confusing, and the customer expects the person on the phone to fix the problem. Now, it's a question of who will handle the solution: a human, a computer, or a human assisted by a computer.

Already, artificial intelligence agents have taken over more routine call center tasks. Some jobs have been lost, and there have been alarming predictions about the future of the job market for these individuals, ranging from modest single-digit percentage losses to the disappearance of half of all call center jobs within the next decade. However, the decline is likely to fall far short of the most alarming predictions, as it has become clear that the industry will still need humans, perhaps with even higher levels of learning and training, as some customer service issues become increasingly difficult to resolve.

Some financial companies have already experimented with fully implementing AI for their customer service issues only to encounter the technology's limitations. Klarna, a Swedish lending company, replaced its 700-person customer service department with chatbots and artificial intelligence in 2023. The results were mixed. While the company saved money, overall customer satisfaction rates also declined. Earlier this year, Klarna hired back a handful of customer service employees, recognizing that there were certain issues that AI couldn't handle as well as a real person, such as identity theft.

Gadi Shamia of Replicant, an AI software company that trains chatbots to sound more human, said in an interview with McKinsey consultants: “Our vision of an AI-centric contact center, where AI agents handle most conversations and fewer, better-trained and better-paid human agents support only the most complex tasks, is rapidly becoming a reality.”

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The call center customer experience, although improved, is still far from perfect.

The initial customer service call has long been handled through interactive voice response systems, known in the industry as IVRs. Customers interact with IVRs by being told, “Press 1 for sales, press 2 for support, press 5 for billing.” These rudimentary systems received an upgrade in the 2010s, when customers could activate the system by saying “sales” or “support” or simple phrases like “I’d like to pay a bill” instead of navigating through a maze of menu options.

But customers have little patience for these menus, leading them to "dial zero," which is call center slang for when a customer presses the zero button on their keypad in the hopes of reaching a human. It's also not uncommon for a customer to be put on hold and transferred after "dial zero" because they didn't end up in the right place for their request.

Aware of Americans' collective impatience with IVR, Arizona Democratic Senator Ruben Gallego and West Virginia Republican Jim Justice have introduced the "Keep Call Centers in America Act," which would require clear pathways to a human agent and provide incentives for companies that keep call center jobs in the United States.

Companies are trying to implement phone systems that broadly understand customer service requests and predict where to send a customer without navigating through a menu. OpenAI, the creator of ChatGPT, is launching its “ChatGPT Agent” service for users that can understand phrases like, “I need to find a hotel for a wedding next year. Please give me options for clothes and gifts.”

Bank of America says it has had increasing success integrating such features into “Erica,” its chatbot that debuted in 2018. When Erica can’t handle a request, the agent transfers the customer directly to the correct department. Erica is now also predictive and analytical, knowing, for example, that a customer may repeatedly have a low balance and need better help budgeting, or may have multiple subscriptions to the same service.

Bank of America said this month that Erica has been used 3 billion times since its inception and is increasingly taking on a larger burden of customer service requests. The chatbot's nickname comes from the last five letters of the company's name.

James Bednar, vice president of product and innovation at TTEC, has spent much of his career trying to make customer service calls less painful for both the customer and the company. He said these tools could eventually do away with the IVR altogether, eliminating the need for someone to “dial zero.”

“We're getting to the point where AI will direct you to the right person for your problem without you having to go through those menus,” Bednar said.

By Ken Sweet, The Associated Press.