Interactive voice response, or IVR, is an automated telephone system that combines pre-recorded messages or text-to-speech technology with a dual-tone multi-frequency (DTMF) interface to engage callers, allowing them to provide and access information without a live agent. If the IVR system cannot retrieve the information that the caller is looking for, the programmed menu options can provide assistance in routing callers to the appropriate representative for help. By integrating computer and telephony technologies, IVR software can improve call flow and reduce wait times, leading higher overall customer satisfaction.
Moviefone was one of the most famous and successful uses of IVR technology in the 1990s. Since the internet wasn’t as accessible then as it is today, movie-goers would call in and provide their zip code to get a list of available movie theaters near them with their respective movies and show times. While Moviefone is a product of the past, its underlying technology is still leveraged, primarily within call centers, to provide customer support and reduced call volume for customer service representatives.
Today, IVR software is also evolving. The development of natural language processing technology expands the range of ways that callers can now interact with computers on the phone. Instead of using a touch tone system, more advanced IVR software enables callers to verbalize their needs on the phone. Then, through speech recognition, IVR system can understand and respond to their inquiries in real-time.
IVR systems improve the customer experience by providing a self-service method for customers to access the information that they need without the assistance of customer support. It also reduces the call volume for contact centers, lowering wait times and operational costs for businesses.
Interactive voice response phone system typically consists of the following components:
From here, one of three types of IVR systems is typically constructed.
IVR technology offers competitive advantages to businesses and advances their automation efforts. Some key benefits include:
While interactive voice response can offer benefits to businesses, the technology still has limitations that it needs to resolve and optimize for.
Poorly deployed IVR systems can lead to high call abandonment rates and negative customer sentiment. Since low customer service satisfaction can harm a brand via negative reviews and public social media complaints, businesses should be thoughtful in their deployment of IVR solutions.
IVR solutions have been utilized across a variety of industries, including banking, healthcare, education, and retail. Below we’ll delve more deeply into these use cases:
Healthcare: IVR technology has a number of practical uses within healthcare, such as pre-treatment questionnaires, patient satisfaction surveys, lab and appointment scheduling, post-discharge follow-up, lab results and patient monitoring. This research (link resides outside of ibm.com) also highlights how it can increase overall patient satisfaction by reminding patients to adhere to their medication schedule.
Education: Research (link resides outside of ibm.com) has shown that educational institutions can implement IVR to assist parents in retrieving a status update on their child's performance and attendance in school. Parents can register with the system and then input a username and password to access key information on future calls.
Customer Service: Customer service call centers straddle across multiple industries. These centers are set up to handle a high volume of inbound calls using automated menus and pre-recorded to handle customer queries and complaints.
Finance: IVR can also be leveraged for a variety of tasks within banking and finance. They can provide account information, like account balances and loan application statuses, as well as enable changes to investment portfolios.
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