Bots: What They Are, Why We Need Them, and How They Can Help Customers

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“Bots” are making a lot of noise on social media and other fronts. These automated conversational applications/programs act like humans, but can they replace humans? The short answer is “no,” but they can add a great deal of value to your company and your customers.

Bots (short for “robots”) are programs designed to perform automated tasks. Bots can be thought of as a form of artificial intelligence software, which I discussed in my recent post on cognitive computing.

While the bots concept might seem new, the technology has been around for decades. Think about it:  You have likely had dozens if not hundreds or even thousands of experiences with IVR (interactive voice responses), where your phone communicates with a computer through the tones generated by each key on the phone keypad. IVR works for tasks like getting bank account or credit-card account details, but the process can be annoying, especially if you need to speak to a human being. You often have to work through an IVR system for several minutes just to get to a person who can help you.

Let’s go one step further and extend this idea to automating response through text messaging. I am not a big fan of chats and text messaging, but I am a fan of the technology that enables these “chats and bots.”

For example, I have long been able to text just three letters to get the cooking gas for my home refilled. I get an instant reply with a booking reference and confirmation details. I use the same method to get the account balance and latest credits to my retirement fund account.

Now imagine using texting services to order food or book a taxi or buy movie tickets, making shopping easier. These and a growing number of tasks are made possible through the use of automated conversational applications, or bots.

At their core, bots are a basic form of artificial intelligence software, designed to enable conversations with humans in which questions can be answered in a simple and quick manner. That said, bots vary in complexity and ease of use, and the success of a bot depends on how well it meets a predefined business goal.

Although bots have been in use for many years, interest in the technology increased when it was highlighted at Facebook’s April developer conference. Facebook demonstrated chatbots as a new way to interact with businesses over the company’s popular messaging service. Other tech companies, including no less than Microsoft and Google, are also making big investments in chatbot technology, which means that buzz is building and that every techie and app developer will want to build one—if they aren’t already doing so.

Technically speaking, bots use a combination of AI, NLP (Natural Language Processing), semantic database technology, and a rule engine. As with any software application, the data storage model is the key, and the success of a “bot” depends on the semantic data model.

How bots can help customers

How can bots help you and your customers in a practical way? Conversation comes naturally to consumers, and these conversational messaging apps provide a straight line of communication for opportunistic and personalized interactions. Chatting with a bot rather than speaking with a representative by phone can save customers time. Yes, there are situations when only a real person will do, but bots can handle just about any issue that requires simple human interaction.

In the retail industry, for example, bots can be leveraged for things like exchanging or returning goods. In the banking and financial services sectors, chatbots can be used to engage customers in conversations that lead to a more engaged and personal experience.

Singapore bank DBS bank, for instance, is looking to roll out a “conversational banking” strategy in which chatbot technology is integrated into its mobile messaging app. Unlike the SMS services DBS and many other banks have had in place, bots process natural language conversations, so customers don’t have to memorize SMS codes or use perfect syntax for things to work. So, instead of texting something like "BALANCE 1234,” you can simply ask, "How much money do I have in account number 1234?"

Chatbots can be leveraged in many other industries, including health care, hospitality, insurance, and human resources.

Analysts are mixed on the potential scope of bots and the timeframe in which they will move into the mainstream. Some analysts say that bots have a long way to go; others say bots will replace humans.

Time will tell, but it’s important for companies to remember that customers sometimes want to have a dialog with a real human, not a robot. Think about a scenario in which customers try bots, and bots fail to impress them. There’s a good chance businesses won’t get another chance to win back the confidence of these customers in the future. So look for the right algorithm to program bots.

We all know automation is the buzz word for the IT industry today. Indeed, we want automation in every part of our lives. We will certainly see more and more bots in our smart phones to help move automation along, but, in my opinion, chatbots still have long way to go for a meaningful business conversation with customers/consumers. We’re just not there yet, and we may never be—at least, not in the way people imagine.

Post Date: 10/5/2016

Prakash Mishra - NTT DATA Prakash Mishra

About the author

Prakash Mishra leads NTT DATA’s Data Architecture and Management Practice. A solutions-driven, results-oriented, self-motivated leader, Prakash has a proven record of extensive data architecture leadership in a complex environment. Prakash has been involved in developing and leading the implementation of traditional and innovative big data strategies and solutions, data modernization and master data management solutions for small to large organizations. He holds a master’s degree in computer science, with two decades of experience specialized in enterprise data architecture and management.