Contact Center AI: A Complete Guide

In contact centers, where customer satisfaction and efficiency are vital to your long-term success, AI offers the potential to solve many of your most frustrating problems. Long call times, angry customers, and inefficient agents are all issues AI can help deal with.

In the US alone, an estimated $1.6 trillion is lost every year due to customers switching loyalties because of poor customer service. Where every second wasted and every customer left dissatisfied is money down the drain, AI helps you save significant amounts of time and drive positive customer experiences.

Forget about waiting for AI to evolve any further, it’s already capable of tackling your problems right now. Contact center owners can already utilize AI Agents to alleviate many of the time-consuming processes that frustrate customers, demoralize agents, and hamper growth. 

Got doubts? It’s no surprise – the discussion around AI is littered with misunderstandings and misinformation. Forget about feeding prompts to ChatGPT or creating images via tools like Midjourney – the true value of AI comes from more focused applications designed to assist you in doing what you already do in a more efficient way. 

In this guide, we’ll show you how AI-powered contact centers work and what benefits they bring to your customers, business, agents, and future performance.

Related content:

• A Complete Guide to Generative AI in Contact Centers
• Best Use Cases for AI in Contact Centers

What is an AI contact center?

An AI contact center is a facility that has integrated AI technology into its systems and workflows. How the technology is integrated differs from business to business, but the overall concept is that AI enables large-scale automation to cut down on labor-intensive manual processes and improve favorable outcomes. 

The core functions of an AI in a contact center environment are: 

• Communicating with customers: AI Agents can chat with customers using natural language and will understand context, generate relevant responses, and take action where required. 
• Assisting agents: AI can also assist agents by providing real-time assistance during calls, speeding up resolutions, or directing them to appropriate resources.   
• Anticipating and directing: Communication is only the first step in an AI’s journey. In contact centers, AI is capable of taking a customer's need or request and either intelligently routing it to the right agent or team OR automatically resolving it. 
• Gathering insight: AI can analyze customer call data at scale and produce valuable insights into common customer queries or language patterns, as well as data around important predictive metrics such as CSAT scores. 

The exact ways AI can be used depend on which technology you choose and your business’s needs – so no two integrations are the same. The way AI is used can vary considerably based on what your internal processes look like and what your customer's needs are. 

However, one thing must be made clear for anyone new to the idea – AI contact centers are not fully automated. Despite the robotic connotations of the term ‘AI contact center’, the truth is that human agents are an irreplaceable part of the customer experience journey. 

Contact center AI exists to assist humans, not replace them. Effective AI implementation within a contact center helps improve customer experience, boost agent satisfaction, and drive overall efficiency gains throughout your entire business. 

How Does Contact Center AI Work? 

In its most basic sense, contact center AI works by interpreting user intent and then taking the appropriate action – whether that is to facilitate an immediate resolution if the AI can accomplish the task on its own, or to elevate more complex cases to a human agent. 

In order to understand how AI achieves this, we need to discuss the relationship between Conversational AI and Generative AI.

What is Conversational AI?

Conversational AI is exactly what it sounds like: an AI capable of genuine conversations with customers. It uses natural language processing to understand the context of a user’s query and create a relevant response. 

Conversational AI in a contact center is integrated into backend systems, meaning it can interact with crucial systems such as your CRM or billing platform. This allows it to action user requests and either resolve them where possible or pass them to an agent. 

What is Generative AI?

Where Conversational AI serves as the front-end experience that customers interact with, Generative AI forms the background layer that generates responses and solutions based on real-world data from Language Learning Models (LLM) or a contact center’s own user data. 

Generative AI excels in its ability to create unique, context-driven content in response to user requirements, which improves experiences for both customers and agents. 

Joining AI Technologies Together

AI Agents combine Generative AI and Cognitive AI to give customers seamless experiences that are indistinguishable from human interactions. Not only can AI Agents hold conversations and understand context, they can also automatically resolve mundane processes such as ID&V. 

Most contact centers exist to resolve customer queries as efficiently as possible. To do that, agents will need to access several different software ecosystems during a call, such as a CRM system and billing platform. These systems exist in isolation and must be accessed individually, which eats into a human agent’s time and hampers their productivity. 

Contact center AI helps directly solve this issue. Your technology partner will start by modeling your existing processes and systems, then implementing AI as a structured meta-layer that sits above them but can access and interact with each system required during calls. 

Conversational AI gives customers and agents access to a rapid and responsive source of direct support, whereas Generative AI provides relevant solutions via need-driven content. Together, these two AI technologies have many different applications throughout a contact center, including:

• Call qualification: Contact center AI can qualify calls and take customers through the initial verification process without requiring human intervention. This helps cut down on a labor-intensive process that ALL agents resent. 
• Improve self-service: If a customer can quickly solve their own problem via a self-service platform, you’ll avoid the need for a longer call and improve satisfaction. AI can help improve the self-service process by channeling users towards their actions and assisting them where necessary to avoid the need for further escalation. 
• AI voice chat: The power of Conversational AI allows AI Agents to talk directly to customers in hundreds of different languages. It deals with the basic elements of the call and then either helps solve their queries or elevates the call to a human agent. 
• Real-time translation: Some AI contact centers can provide translation that allows you to field calls in any language, translate to text for an agent to interpret, and then translate the agent’s response back to the customer—all in real time. 
• Call insights: Machine learning means AI can analyze calls and build data for future action—or use existing data to identify patterns or trends, such as a negative customer reaction. 
• Intelligent call routing: Your agents are too valuable to waste time on easily automated tasks like call verification. AI takes care of the initial hurdles in a call and then directs it to the appropriate agent or team. It can even elevate cases to managers or other key employees. 
• Agent assistance: AI isn’t just for your customers, it can also help your agents by listening in on calls to provide real-time insights, and prompt the most beneficial solutions, or even create the content necessary to best help the customer. 

So we know what an AI contact center is and how it works – but is it worth the investment for your business? Let’s take a closer look at the benefits of AI for your end-customers, your team and your organization. 

Benefits of AI in Contact Centers

AI is reaching a stage where companies that fail to invest are being left behind. Like CRM systems just a decade ago, AI is already a must-have technology that you can’t afford to ignore in customer service. 

The benefits of AI are compelling. When integrated correctly, AI brings cascading benefits to every KPI a contact center may have. Some of the most valuable benefits include: 

Saves Time

When customer resolutions need to happen fast, every minute wasted in your call-handling process has the potential to cost you money AND frustrate your customers. AI Agents help save time across your entire workforce by automating manual tasks such as data entry and user verification. 

Integrating AI is far faster than hiring and training human employees. Task-specific agents can be brought online in a matter of weeks, rather than the months associated with human recruitment.

In terms of tangible impact on time-related metrics, AI Agents can lead to 99.5% faster response times and reduce your average handling time by approximately 30%. 

Empowers Better Agent Utilization

AI doesn’t replace human agents – it assists them. By taking care of the mundane tasks that clog up a human agent’s workflow, AI Agents give humans more time to focus on complex problems. 

With an AI agent that can detect sentiment and elevate calls where necessary, human agents will be able to better focus on handling queries at Tier 2 and above, which will lead to more satisfactory resolutions and boost agent morale. 

Provide Effective Translation

Agents powered by Generative AI and Conversational AI can understand customer queries in over 100+ languages, whether through text or speech. In tier 1 cases, the agent can generate the appropriate responses to a customer in their chosen language. For cases where a human is required, AI Agents facilitate live translation for both text and voice outputs. 

Ultimately, this means customers feel more supported and are better able to secure their desired resolution regardless of their native language. 

Boosts Customer Satisfaction

The faster a customer’s problem is resolved, the more satisfied they’ll be. AI Agents help to improve satisfactory resolutions by either efficiently taking care of Tier 1 requests like simple changes to customer data OR elevating to an agent, who will also be provided with real-time AI support to help provide context and reach an effective outcome. 

Supports Long Term Growth

Compared to the costs associated with hiring and training human agents, scaling AI is cost-effective and straightforward. In addition, AI Agents create call logs and gather data-driven insights. Using these insights, you can predict future trends in crucial metrics such as workload volumes to help plan your future activities. 

AI doesn’t just help plan for growth – it also increases the revenue used to fuel it. 

Use Cases of AI in Contact Centers

To get a sense of how impactful AI Agents can be in a contact center environment, let’s look at some clear use cases depicting how AI can be applied to the processes commonly encountered in the sector. 

1. Identification & Verification 

Identifying and verifying users is a fundamental part of almost every call. AI Agents can take care of this initial phase without human intervention by accessing all relevant systems and using either text or voice communication to run customers through the ID&V process. 

Using AI for your ID&V allows for faster call resolution. Once the mundane process has been efficiently dealt with by the AI, a human agent is only involved, leading to a more satisfactory outcome for the customer and agent alike. 

2. Self-service

When a customer’s inquiry is straightforward and only requires small changes within pre-defined parameters, providing a self-service option helps reduce call volume and improves customer satisfaction. Order tracking, changing reservation details, or booking an appointment are all examples of tasks that are suited to self-service. 

In fact, as digital technology improves, 67% of customers said they preferred self-service over speaking to an agent. An AI chatbot provides a detailed self-service portal that understands the context of a user’s query. 

If possible, it will facilitate a resolution or direct the user to the correct resource. If there are issues or negative customer sentiment, the chatbot can then alert a human agent to intervene before the customer’s experience is ruined. 

3. Call Routing

Waiting to be transferred to the right agent or being placed on hold can quickly frustrate a customer. AI Agents prevent this by providing intelligent call routing. 

An AI agent is capable of understanding the context of a customer’s request and then automatically routing them to the appropriate resource or agent. The AI will even recognize the most relevant agent for a user’s query based on past call data and other metrics, such as a specific agent’s skills or experience. 

4. Agent Assistance 

In an AI contact center, an agent should only have to focus on customer problems that the AI can’t automatically resolve. These are more complex and individual, so the agent has to talk to the customer and work out the best resolution. Traditionally, this can take a long time as the agent may have to access various systems and resources as they troubleshoot the issue. 

Using an AI instead means the agent will get real-time support during the call, with the appropriate resources presented to them in one workspace. In a Zendesk report, 70% of customers said they expected anyone they interact with to have full context over their problems – which an AI can facilitate by providing contextual information directly to the agent and creating/suggesting relevant solutions. 

5. Call Wrap-Up & Analysis

Human agents often spend too much time wrapping up calls because they have to manually create a detailed log and file it in the right place. Contact center AI will automatically transcribe customer calls and either create a summary in the relevant case log or open a new case. 

Call monitoring also means that contact center AI can collect detailed information about customer behavior and call data, which is then used to provide detailed insights used in reporting and performance monitoring. 

Best Practices for Implementing AI in Call Centers

Like all technology, AI’s effectiveness depends on how well it is implemented in your business. To have the biggest impact, it must be configured around your specific requirements and embraced by your team. If you’re interested in trying contact center AI, follow these best practices to maximize the benefits: 

• Set specific objectives: Before engaging with AI, create a defined list of objectives based on common issues and challenges within your business, such as reducing agent churn rates or improving customer satisfaction. 
• Audit existing systems and processes: Map out each core process for calls to your contact center to determine which systems are involved and what relationship exists between them. For example, a customer product query might involve your CRM system, inventory management system, and third-party tracking – all of which an agent might have to access individually.   
• Identify a trial use case: After setting your objectives and mapping out which systems are involved in customer interactions, you should identify a narrow use case to serve as your first test for AI. This should be a process that is low complexity but high volume, such as caller identification. Monitor the results of this initial use case and then scale it out to other similar basic processes before moving on to more complex ones. 
• Prioritize agent engagement: Human agents needn’t feel threatened by AI. You should provide training sessions that show them how to get the most benefit from AI systems and demonstrate why AI assistance is a valuable tool that will lead to greater job satisfaction. 
• Consider AI as a long-term pillar, not a short-term solution: The nature of AI means it continues to learn, adapt and grow over time. AI integration will drive some immediate benefits, but these will continue to improve the more the AI collects data and engages in customer interactions. Consider AI as a fundamental pillar that helps you protect agent productivity, improve customer satisfaction, and reduce call volumes in an increasingly demanding world.  

The Future of AI Contact Centers

Offering the most cost-effective way to deal with the increased volume and complexity of customer queries, AI contact centers are a non-negotiable part of the industry’s future. 

86% of call center agents say customer expectations are higher than ever. The indispensable nature of AI is directly aligned with the needs of consumers, whose digital-first lifestyles have shaped a clear set of expectations that AI is well-positioned to assist.

According to this PwC study, speed, convenience, knowledgeable help, and friendly service were the four main factors contributing to positive customer experiences. Compared to a traditional contact center, an AI-powered one is better able to achieve all of these elements in a more cost-efficient manner, which can be scaled for future growth. 

Considering one in three customers will stop doing business with a brand after just one bad experience, you can’t afford to ignore AI – especially when competitors are embracing it and consumers are growing accustomed to intelligent chatbots and personalized, instantaneous support. 

As you look towards the future, AI must form a crucial part of your business strategy. Not only will it improve customer experience by providing faster support with more satisfactory outcomes, but it will also establish more self-service opportunities, save valuable time, and improve agent satisfaction to reduce employee turnover. 

Get involved in AI now to capitalize on the benefits and start outpacing your competitors. Book a demo of the world-leading Cognigy.AI platform to see the dramatic impact AI can bring to your contact center.

AI Contact Center FAQS

How Does AI Integrate With Our Contact Center Systems?

The way an AI integrates with existing systems depends on your organization – but in general, it acts as a meta layer that sits above them and can facilitate interaction between them all from your CCaaS or on-prem system, to CRM, ITSM tool, Knowledge Management, Case Management system and more. 

Your AI provider will discuss your existing processes and help design and deploy the AI to support key tasks. This meta layer effectively prevents the ‘siloing’ of information that can too commonly occur in a contact center and leads to massive efficiency gains. 

How Does AI Improve Customer Service?

AI improves customer service by providing intelligent support to customers and agents alike. From automating simple tasks like call identification to free up agent time to improving customer satisfaction by offering tailored self-service solutions in real time, AI is capable of understanding user needs and finding the best solution. 

AI improves customer service at all levels – from the end customer to your agents and even at an organizational level. 

How Do I Know if My Call Center Needs AI?

Most call centers should explore the benefits of AI as customer expectations grow more and more demanding. However, the centers that need it most are those that face high call volumes and staff churn rates. AI is best focused on alleviating the burden of tier 1 tasks, which improves agent satisfaction and saves enormous amounts of time.