Speech-Enabled IVR: Money Maker or Money Pit?

Speech-enabled interactive voice response (IVR) can reinforce your company’s brand. But Art Hall, the vice president of sales and customer care operations for Alpharetta, GA-based financial services firm NetBank, says it still has several hurdles to clear before it becomes a mainstream application. Hall outlined the pros and cons during the National Conference on Operations & Fulfillment held earlier this month.

IVR makes it possible for customers to use a single telephone number to reach an entire organization and then self-direct to the work group they need by following instructions given in the initial welcoming message. The challenge of IVR is to configure the menus and script the messages clearly and simply enough so that it’s easy for customers to use accurately. IVR also allows catalogers to design messages to be played for callers on hold or in a queue. Automated messaging can be used to give customers immediate information about waiting time;

A recent study by research firm Gartner indicated that 61% of speech-enabled IVR callers were highly satisfied with their most recent interactions. In fact, 56% of users indicated that they would definitely or probably use the system. Only 7% stated they wouldn’t use speech recognition again.

Though callers always have the option of transferring to a live operator, the IVR system can handle many common questions and requests. For instance, customers can trace orders and shipments and even request a catalog via the system without talking to a live agent.

The net effect, Hall says, is two-fold: First, the contact center can handle a greater volume of calls, and your CSRs could spend more time with the customers who really need it. Second, the contact center could hire fewer agents. So a company theoretically could justify an IVR expenditure by calculating its labor savings.

But there are drawbacks. For starters, installing a speech enabled IVR system is expensive. Typically installations start at $250,000 and can run into the millions of dollars. What’s more, many callers still prefer to talk with a live person.

And as with any other technology, a failed implementation can dilute earnings and drive customers away. So you must start slow. Critical factors for a successful speech-enabled IVR implementation, says Hall, include using customer focus groups and usability studies to evaluate if your customers would welcome the technology. Also, be sure to integrate speech-enabled IVRs as part of an overall CRM strategy, offloading “non-value-add” contacts, such as a catalog request.

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