You’ve probably encountered a small chat box at the lower corner of your service provider’s website with the image of a good-looking man or woman, saying “Hi, I’m Danny, how may I help you?”; and you probably know by now that the “person” chatting with you is not a real person, but a chatbot.
A chatbot is a computer program or an artificial intelligence which conducts a conversation via auditory or textual methods, according to Techtarget.com. It is powered by rules and sometimes artificial intelligence that you interact with via a chat interface. Some chatbots use sophisticated natural language processing systems, but many simpler ones scan for keywords within the input, then pull a reply with the most matching keywords, or the most similar wording patter, from a database.
The term “ChatterBot” was originally coined in 1994 by Michael Mauldin, a computer scientist, inventor of the Lycos web search engine, and creator of the first Verbot, Julia, to describe these conversational programs. Today, most chatbots are accessed via virtual assistants such as Google Assistant and Amazon Alexa, via messaging apps such as Facebook Messenger or WeChat, or via individual organizations’ apps and websites.
Chatbots can be classified into usage categories such as conversational commerce (e-commerce via chat), analytics, communication, customer support, design, developer tools, education, entertainment, finance, food, games, health, HR, marketing, news, personal, productivity, shopping, social, sports, travel and utilities.
Customer service is a use case where chatbots can make a strong impact. We have seen how chatbots are capable of handling first customer contact or even handling complete cases. According to Gartner, the customer engagement domain will continue to dominate in the coming years, with 34 percent of the cases using chatbots.
While many consumers still prefer human agents to chatbots for their customer service engagements, its use will only continue to grow. In fact, a global Oracle research revealed that 80 percent of businesses want chatbots by 2020. As they become more inexpensive to create and deploy, companies will grow its use in internal employee support activities such as policy inquiries and HR-related concerns.
The adoption of chatbots is primarily driven by millennials, and even so the coming generation Z into the workforce. According to a study conducted by CARAVAN, about 2 of 5 millennials think that chatbots provide better service than humans. About 70 percent of the millennials who have used chatbots have reported it to be a positive experience.
Because millennials value speed and efficiency more than their previous generations do, they are gravitating towards using self-service options like chatbots, instead of engaging with people. Being the first generation to experience the smartphone era, millennials want instant solutions and are not used to waiting. A chatbot caters very well to this need by interacting with multiple people at the same time which wasn’t possible in the traditional method,
Increasingly, chatbots are now being used by the human resource department to provide faster service to employees such as filing and inquiries on leaves, benefits administrations, and others. With companies having more than 50 precent millennials now in their stable, there is more pressure and business case to use chatbots internally.
But the rise of chatbots will definitely affect the call center industry which employs close to one million agents. We are already seeing the growing use of artificial intelligence and chatbots in the business process outsourcing industry, affecting employees through job reassignments or at worse, lay-offs.
Hence, there is an urgent need to retrain customer service agents to handle more complex problems and issues of customers, and leave chatbots to do the menial tasks; because in the coming decade, we’re sure that chatbots will evolve to a more advanced artificial intelligence.
We have to take advantage of chatbots now while preparing our workforce for the future.
The author is President & CEO of Hungry Workhorse Consulting, a digital and culture transformation firm. He is the Chairman of the Information and Communications Technology Committee of the Financial Executives Institute of the Philippines. He teaches strategic management in the MBA Program of De La Salle University. The author may be emailed at firstname.lastname@example.org.