TREND: Uptick in automation deals may hit customer support business

TREND: Uptick in automation deals may hit customer support business

Informist, Thursday, Apr 13, 2023


By Reshab Shaw


MUMBAI - A recent trend showing increased demand for automation deals points to upcoming disruptions in customer service and support businesses, warn experts. Some of the sectors that may see large-scale disruption from automation are manufacturing, logistics and warehousing, banking and financial services, healthcare, and retail.


The shift towards greater automation will help the industry avoid or streamline repetitive and time-consuming tasks, reduce human error, improve productivity and cut costs.

The emergence of artificial intelligence chatbots like ChatGPT has shone the spotlight on newer technologies that can revolutionise business processes across various industry segments. GPT, or Generative Pre-Trained Transformers, is a language model which can generate human-like texts when fed with text-based input. It can create coherent information extracting from publicly available datasets.


Kunal Purohit, chief digital services officer at information technology services exporter Tech Mahindra Ltd, expects these technologies to cause significant disruption. "One of the major disruptions is in the field of customer service and support," he says.


While IT services firms like Tech Mahindra may smell an opportunity in deploying such cost-saving software for clients, providers of business process outsourcing, or BPOs, may find their entire business model overturned. BPO players, such as Hinduja Global Solutions, get most of their revenue from services such as customer support and outsourced marketing.


In light of this, Natarajan Radhakrishnan, president and global chief innovation officer at Hinduja Global Solutions, had set a very keen set of eyes on this technology for years.


"Tasks like customer support… may be automated, reducing the need for human workers in these areas," Radhakrishnan said. "One of the key benefits of such large-language models is the ability to understand natural language and generate human-like responses, which can help automate tasks that previously required human intervention." 


Even those who are either hesitant or unwilling to adapt to these AI-based solutions will sooner or later be forced to fall in line, experts said. Moreover, according to Srikumar Ramanathan, chief solutions officer at mid-tier IT services provider Mphasis, automation is not just about saving costs, it can be a clear service differentiator as well.


It is helping tech-savvy start-ups challenge larger incumbent players, forcing these companies to realise that automation is not just about improving efficiency but is also a differentiator and a way to delight the customers.


"Now with the emergence of GPT, we are working on ways to offer enterprise solutions to our clients," Ramanathan said.



Emerging technologies and automation tools like GPT have enabled Mphasis to identify several potential use cases for large language models in enterprise solutions, Mphasis' Ramanathan said.


Businesses have realised more and more use cases for these language models over time. For example, firms can use the technology to summarise internal documents, simplifying access to key information for employees.


Another potential use case is extracting structured data from unstructured sources such as emails, which can help businesses gain valuable insights and improve decision-making. 


Businesses can even leverage it to enhance access to knowledge repositories by verifying search-generated results against trusted documents. Besides, virtual assistants are already being deployed by countless firms on their websites, which have cut down on both jobs and cost. Purohit of Tech Mahindra said these tools can even handle complex queries without the need for human intervention, helping enterprises save cost and provide faster response to customers.


For instance, Tech Mahindra has reduced the average query handling time by 49% with 100% call audit and over 85% accuracy for a large education technology company by using its voice data analytics solution.


Suraj Nangia, managing director of business consultant firm Nangia Andersen LLP, says automation can be used for customer service to reduce the need for human representatives. "(It will) thereby result in significant cost savings for businesses," he said. Nonetheless, Nangia warned that these natural language processing tools have limitations, such as biases or inaccuracies. And it cannot be a replacement for human interaction and expertise in many areas as of now.



As seen in previous industrial revolutions, experts believe that automation of previously non-automatable tasks will free up human resources for newer, more creative jobs and pursuits. The industrial revolution of the 19th century led to the burgeoning of new service sector jobs as it reduced the need for repetitive manual jobs, particularly in the manufacture of goods such as clothes and automobiles.


The emergence of AI systems, too, will lead to the elimination of some jobs, but unlike the industrial revolution, this will mostly affect the service sector. At the same time, it will also create new roles, particularly those focused on managing or collaborating with AI systems.


All this means that the kind of skills that will be in demand will undergo a change.


"As such older jobs will be impacted but at the same time (it) will be replaced by new technologies and new jobs for skilled and specially trained workers," says Rishi Agrawal, chief executive officer and co-founder of IT services and consulting firm TeamLease Regtech. 



While most say automation will impact jobs in the customer support business, some experts believe it might not be true. The World Economic Forum's Global Risks Report 2023 says around 85 mln jobs are expected to be displaced by the rise of generative AI models such as ChatGPT. Albeit, 97 mln jobs are expected to be created by AI and technology by 2025.


"It's important to note that the technology is not designed to replace human workers entirely but to augment their capabilities and improve efficiency," Purohit told Informist.


While the continued trend of AI-related technologies will undoubtedly impact jobs, the key for workers will be to adapt to these changes by acquiring relevant skills and staying informed about advancements, experts say.


Nevertheless, adoption of generative AI has the potential to impact jobs across industries, particularly those involving repetitive and routine tasks, displace human workers in creative fields, or automate tasks in fields such as customer service and data analysis, Tech Mahindra said.  End


Edited by Tanima Banerjee


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