AI voice and IVR has the potential to take customer experience to a higher level of customization and personalization, says Jerry Briggs, ApexCX, leader in CX.

IVR technology has evolved over the last four decades into today’s AI Voice Assistance or Enhanced IVR Design, hopefully to improve human to human customer experience, not to replace it. 

Since IVR was widely adopted for answering customer calls by call centers in 1990’s, it has contributed to automatic call routing and queuing, streamlining incoming calls into categories, and cost reduction. Since the 2000s, IVR has become the standard practice for almost all contact centers while “speech recognition software developed and eventually became more affordable, allowing faster processing speed”, per this article. “By 2010, all-inclusive platforms emerged featuring advanced call tracking functions, automatic short message service (SMS), and comprehensive analytics features. This is when the advanced IVR systems we know today began to take shape. Advancements allowed customers to contact companies using various channels, allowing clients to choose their communication method”, stated in this report.

Old-style IVRs can turn frustrated customers away

However, now in the year 2024, as more sophisticated and more advanced AI voice assistance comes of age, “ too many companies still treat IVR as an afterthought, relying on outdated technologies and customer journeys that have changed little since the 1990s. Nowadays, customers want their issues resolved as quickly as possible with very little effort. Old-style IVRs require a lot of effort and don’t always provide a solution. The result: irritated customers, poor performance, and higher costs. Across industries, seven out of ten companies report that their containment rate, a measure of the percentage of calls that remain within the IVR system, is 30 percent or less.” According to a recent McKinsey report. (Emphasis added.)

IVR limitations 

Among many technical limitations such as oversimplified or over-complicated menus, and requiring regular maintenance and updating (not self-trainable like AI), the following are more “fatal” defects that can lead to losing customers:  

  • Lacking nuances for dealing with various inquiries
  • Inflexibility when dealing with customers who prefer a live agent
  • Customer frustration from long hold time, inability to solve their issues
  • The absence of human touch and empathy, emotional disconnection
  • Damages to brand reputation with perceived unresponsiveness to customer sentiment
  • Loss of customers due to perceived lack of respect and care.

IVRs can neither understand complex requests nor the customer’s emotions. The initial benefit of cost cutting for companies is increasingly outweighed by poor customer experience that drives customers away. “[M]ore than half of consumers (51%) have stopped using a business because they’ve reached an IVR”, per 2019 Vonage survey.

The difference between IVR and AI Voice Assistance (or “Enhanced IVR design”)

By leveraging AI’s natural language processing abilities, AI voice assistants can handle customer queries and provide assistance with human-like conversations and personalized CX, where IVR falls short. 

Among other benefits of AI voice assistant answering systems, here are some that take IVR to a higher level:

24/7 services: Customers can ask questions, leave messages, make appointments around the clock, all year round. 

Eliminating call waiting time for customers. AI voice can handle all calls at the same time, and answer calls on the first ring. 

Individualized call transferring and routing: AI voice can custom-match a customer’s particular need with someone with that specialty, thus offering a personalized experience.

Call Analytics: AI can track, analyze, and self improve based on data and call patterns, which shed light on customer preferences. The analytics helps improve employee performance and development, CX, ESAT, CSAT, sales and marketing, and management decisions. 

Natural conversation: “AI-powered voice assistants converse with callers in a natural way, avoiding the frustration of canned automated responses and providing fast answers to caller questions.”

Personalized experience: As AI’s capabilities increase, its understanding of customers’ intricate needs will get better, and so will its ability to meet customers’ expectations with more effective and customized responses.  


Like IVR, AI phone answering can be scaled to handle large call volumes.

“With an intuitive, customizable, and AI-powered IVR solution, businesses can not only improve the customer journey and increase satisfaction scores, they can also boost employee engagement and efficiency, enhance productivity, and reduce operational costs.” This article stated.


The “Three Waves” approach 

The 2023 McKinsey report recommended these three sequential stages to bring an old-style IVR system to an advanced AI system:

Wave 1 uses advanced analytics to determine the ‘break points’ in the current call flow, where customers give up or seek help from an agent. This gives companies a list of potential adjustments to the system and allows them to implement quick design changes to tackle some of the top sources of user frustration.

Wave 2 redesigns customer journeys for the priority call types identified in Wave 1. This wave allows companies to apply user-centric design principles from a clean sheet. It’s also an opportunity to integrate available new technologies, such as call flows that adapt based on context data from customer activity outside the IVR.

Wave 3 applies machine learning and AI technologies to add predictive and conversational capabilities to the IVR system.

Companies that want to move fast can conduct some of these activities in parallel. If the organization already knows which AI and machine learning (ML) platforms it is going to use in Wave 3, for example, it can start their implementation earlier, allowing Wave 2 activities to benefit from more advanced technologies.”

AI is only as good as humans train it to be

HOWEVER, AI voice cannot replace human connection through live agents. Only humans have empathy and EQ. Businesses need to balance AI automation with human interaction, and train AI to act like human-to-human interactions, but not replace them, or worse, demanding customers to comply with AI or be subjugated to AI’s will.  

Contact center management, employees, and business leaders have a lot to do in continuously improving customized AI and IVR systems, to achieve higher levels of customer satisfaction. No matter what technology, IVR or AI, it is paramount for contact centers to prioritize what customers think and prefer, in every aspect of processes, systems, technology, and people. Creating a workplace culture with systemic and relentless focus on improving behaviors, actions, and attitudes is an ongoing journey. 

ApexCX is a leader in the customer experience support services, offering both cutting edge technology to better serve human-centered organizations that provide customer centric products and services.  We assess, diagnose, design AI experience and customer journey, and implement changes to “Apex” your customer experience.  Please contact us for more information. Thank you.