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The Decline of IVR
The always-connected customer prefers self-service smartphone applications.
Posted Oct 29, 2010
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All technologies follow the same life cycle: an ascent leads to a peak, which is followed by decline. Every technology serves a purpose, but most face that inevitable decline due to competition and rapid innovation. Interactive voice response (IVR) systems are no exception.

To understand how far we've come, we need to go back to where it all began. In the 1970s, IVRs were useful because companies needed a cost-effective way to automate simple services on the most ubiquitous communication network of the time: the telephone.

Today is a very different world, with a dramatic shift underway that is changing how people communicate — with each other and the companies they do business with. Over the last few years, for example, we have witnessed the mobile Web go mainstream. Recent reports show that 22.7 percent of households in the United States have abandoned their landline phones, relying instead on a mobile phone as their only telecommunications channel. The increase of mobile devices, particularly smartphones, has more and more consumers equipped with fast wireless Internet connections, demanding connectivity and continuity at all times. This evolution is ushering in a new age of the always-connected customer, which is transforming the way companies interact with and service their customers.

The always-connected customer does not want to talk to an IVR when she can have self-service applications on her smartphone capable of highly intuitive touch, text, and talk interactions to get the answers she needs, when she needs them. More and more consumers prefer to launch an application via a touch screen and use voice search to discover and access the kind of services that a live agent might provide. If a live person is needed, a smartphone user can just touch the "live agent" icon to "launch" a connection to a person who will continue right where self-service leaves off.

The habits and demands of the always-connected customer raise the bar for customer self-service to a level that IVRs are not equipped to meet. This requirement for a rich experience has had a direct impact on the way companies prepare to interact with their customers, leading to the decline of the IVR and the emergence of the next generation of customer self-service solutions — rich phone applications (RPAs).

RPAs create exceptional customer experiences driven by the same applications that live agents access today when they speak to a customer, including systems for CRM, business process management, and knowledge management. RPAs are not only equipped with voice-search capabilities for even greater ease of use and efficiency, but also take advantage of the multimodal capabilities available on a new generation of smartphones.

As an example, consider a customer who is concerned about an abnormally high monthly bill. He launches a branded customer-care application on his smartphone, taps the "speak" button, and says, "This month's bill is too high." The application responds, "Analyzing your current bill." In the background, the current bill is compared with past bills, and after a few seconds the application has a response for the customer: "I see that the difference is because you sent 30 extra SMS messages than your plan allows." The application then suggests a different plan. At this point, the user has the opportunity to change his plan or connect to a representative by touching a "talk to agent" button.

As another example, a customer of a broadband service provider has trouble accessing the Internet. He launches a branded customer-care application on his smartphone, taps on the "speak" button, and says, "I can't access the Internet." The application responds, "Hold on while I check your Internet connection." A few seconds later, the application has an additional message: "I was able to confirm that we are experiencing a service issue in your area. Would you like me to notify you when the issue has been cleared?" The customer taps or says "yes," and later receives a notification that the problem has been resolved and the Internet should be working again. The notification also includes instructions for the customer to reboot the modem and router.

The always-connected customer demands connectivity and continuity in every place, device, and relationship. To meet these new standards, companies need to re-evaluate their technology spending and their allocation of resources. Rather than investing in improving their IVR systems, companies should be thinking about replacing those systems with rich phone applications. An RPA responds to evolving customer habits by empowering customers to get service when, where, and how they need it. RPAs also provide the great customer experience needed to build lasting and profitable customer relationships.

What company doesn't need to do that?

Reference: http://www.ctia.org/media/industry_info/index.cfm/AID/10323

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About the Author
The strategic focus and leadership of Chief Executive Officer Zor Gorelov (zor@speechcycle.com) has built SpeechCycle into one of the fastest-growing technology companies in North America. For more information, please visit www.speechcycle.com.

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Please note that the Viewpoints listed in CRM magazine and appearing on destinationCRM.com represent the perspective of the authors, and not necessarily those of the magazine or its editors

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For the rest of the October 2010 issue of CRM magazine, please click here.

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