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Aloric, based in Irvine, California, which runs customer-service centers around the world, has introduced an artificial intelligence translation tool that enables its representatives to talk to customers who speak 200 different languages and 75 dialects.
So an Aloric representative who, say, only speaks Spanish could field a complaint about a faulty printer or an incorrect bank statement from someone who speaks Cantonese in Hong Kong. Aloric would not need to hire a Cantonese-speaking representative.
Such is the power of AI. And, potentially, the danger: Maybe companies wouldn’t need as many employees — and some jobs would be cut — if chatbots could handle the workload. But the point is, Aloricia isn’t cutting jobs. It’s still hiring aggressively.
The experience of Alorica and other companies, including furniture retailer IKEA, suggests that AI may not prove to be the job killer that many fear. Instead, the technology may resemble past successes – the steam engine, electricity, the internet: eliminating some jobs while creating others. And possibly making workers more productive in general, ultimately to their benefit, their employers and the economy.
Nick Bunker, an economist at Indeed Hiring Lab, said he thinks AI “will affect a lot of jobs – probably every job to some degree indirectly. But I don’t think it will lead to mass unemployment. We’ve seen other big tech events in our history, and they haven’t led to big increases in unemployment. Technology destroys but it also creates. New jobs will be created.”
At its core, artificial intelligence enables machines to perform tasks that previously required human intelligence. The technology has existed in early versions for decades, emerging in the 1950s with the problem-solving computer program, Logic Theorist, created at what is now Carnegie Mellon University. More recently, think of voice assistants like Siri and Alexa. Or IBM’s chess-playing computer, Deep Blue, which managed to beat world champion Garry Kasparov in 1997.
AI burst into the public consciousness in 2022 when OpenAI introduced ChatGPT. It is a generative AI tool that can hold conversations, write computer code, compose music, write essays, and provide endless streams of information. The advent of generative AI has raised concerns that chatbots will replace freelance writers, editors, coders, telemarketers, customer service representatives, paralegals, and many others.
“AI is going to eliminate a lot of existing jobs, and it’s going to change the way a lot of existing jobs work,” OpenAI CEO Sam Altman said in a talk at the Massachusetts Institute of Technology in May.
Yet the widespread assumption that AI chatbots will inevitably replace service workers, the way physical robots took over many factory and warehouse jobs, is not becoming a reality in any widespread way — at least not yet. And it probably never will.
The White House Council of Economic Advisers said last month that it found “little evidence that AI will have a negative effect on overall employment.” The advisers said history shows that technology typically makes companies more productive, spurs economic growth and creates new types of jobs in unexpected ways.
He cited a study done this year by David Autor, a prominent M.I.T. economist: It concluded that 60% of the jobs Americans hold in 2018 didn’t even exist in 1940, but were created by technologies that emerged later.
Challenger, Gray & Christmas, an outplacement firm that tracks job cuts, said it has yet to see much evidence of layoffs that can be attributed to labor-saving AI.
“I don’t think we’ve started to see companies saying they’ve saved a lot of money or cut jobs they no longer need,” said Andy Challenger, who leads the firm’s sales team. “That may happen in the future. But it hasn’t happened yet.”
At the same time, the fear that AI could pose a serious threat to certain categories of jobs is not unfounded.
Consider Sumit Shah, an Indian entrepreneur who caused a stir last year by claiming he had replaced 90% of his customer support staff with a chatbot called Leena. Shah’s company, Dukaan, which helps customers set up e-commerce sites, said the move reduced response times for inquiries from 1 minute, 44 seconds to “instant.” It also reduced the typical time it takes to resolve problems from two hours to just three minutes.
“It’s all about AI’s ability to handle complex queries with accuracy,” Mr. Shah said via email, adding that the cost of providing customer support has decreased by 85%.
“Difficult? Yes. Necessary? Absolutely,” Mr. Hahn posted on X.
The shop has increased its use of AI for sales and analytics. “These tools are becoming more powerful,” Mr. Shah said.
“It’s like upgrading from a Corolla to a Tesla,” he said. “What used to take hours now takes minutes. And the accuracy is at a whole new level.”
Similarly, a study last year by researchers at Harvard Business School, the German Institute for Economic Research and London’s Imperial College Business School found that job postings for writers, coders and artists plummeted within eight months of ChatGPT’s launch.
A 2023 study by researchers at Princeton University, the University of Pennsylvania, and New York University concluded that telemarketers and teachers of English and foreign languages held the jobs most exposed to ChatGPT-like language models. But exposure to AI doesn’t mean you’ll lose your job. AI can also do the hard work, freeing people to do more creative work.
For example, Swedish furniture retailer IKEA introduced a customer-service chatbot to handle simple inquiries in 2021. Instead of cutting jobs, IKEA retrained 8,500 customer-service employees to handle tasks like advising customers on interior design and answering complex customer calls.
Chatbots can also be used to make employees more efficient, complementing their work rather than taking away from it. A study conducted by Erik Brynjolfsson of Stanford University and Daniel Lee and Lindsay Raymond of MIT tracked 5,200 customer-support agents of a Fortune 500 company who used a generative AI-based assistant. The AI tool offered valuable suggestions for handling customers. It also provided links to relevant internal documents.
The study found that those who used chatbots were 14% more productive than colleagues who didn’t. They handled more calls and completed them faster. The biggest productivity gains – 34% – came from the least experienced, least skilled employees.
A customer-service representative at the Aloric call center in Albuquerque, New Mexico, was struggling to access the information she needed to handle calls quickly. After Aloric trained her to use AI tools, her “handle time” — the time it takes to resolve a customer call — dropped from an average of 14 minutes per call to just seven minutes in four months.
Over a six-month period, AI tools helped a group of 850 Aloric representatives reduce their average handle time from eight minutes to six minutes. They can now handle 10 calls an hour instead of eight – an additional 16 calls in an eight-hour day.
Aloric agents can use AI tools to quickly access information about customers calling in – such as to check their order history, or to find out if they had called before and hung up in frustration.
Say, said Alorica co-CEO Mike Clifton, a customer complains that he received the wrong product. The agent “can click replace, and the product will arrive tomorrow,” he said. “‘Can I help you any further? No?’ Click. Done. In and out in 30 seconds.”
Now the company is starting to use its real-time voice language translation tool, which lets customers and Aloric agents talk and hear each other in their own language.
“This allows (Alorica representatives) to handle every call,” said Rene Paez, vice president of customer service. “I don’t have to hire someone from the outside to find someone who speaks a certain language.”
Yet Aloriccia isn’t cutting jobs. He’s continuing to hire people — especially those who are comfortable with new technology.
“We’re still actively recruiting,” Ms. Paez says. “We still have a lot to do.”
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