How AI Is Shifting an Employee Market to an Employer Market

Klarna, a Swedish-based company that offers a “buy now pay later” option, allowing customers to purchase merchandise from retailers on layaway, recently shared its mind-blowing financial results in an article on Forbes.com.

Klarna reported having more than 150 million active users purchasing from more than 500,000 vendors. Daily, its website handles upwards of 2 million transactions. The company itself has 5,000 employees.

For the past couple of years, Klarna has been crafting its own artificial intelligence tool called the AI Assistant, which targets the automation of a large portion of its customer service operations. Earlier this year, Klarna shared that their AI Assistant now adeptly manages inquiries concerning refunds, returns, payment issues, cancellations, disputes, and correcting invoice errors. The tool offers instant updates on pending balances and payment plans and offers advice on spending limits and alternative purchasing strategies in more than 35 languages around the clock.

Customer resolution goes from 11 minutes to less than 2

Over the recent year, AI Assistant has engaged in 2.3 million conversations, accounting for two-thirds of all customer service interactions. Effectively, it’s replacing employees, performing the duties of 700 full-time customer service representatives. More significantly, it matches the customer satisfaction levels of human agents. It boasts enhanced accuracy in resolving tickets, leading to a 25% reduction in follow-up inquiries. Tickets are now resolved in under 2 minutes, significantly improved from the previous 11 minutes. This tool is operational in 23 markets.

Klarna says AI Assistant is saving them more than $40 million annually. “This AI breakthrough in customer interaction means superior experiences for our customers at better prices. It also means more interesting challenges for our employees, and better returns for our investors,” said Sebastian Siemiatkowski, co-founder and CEO of Klarna, in a press release.

The future of human employees

The impact of Klarna’s AI-fueled customer service offering on its workforce serves as a cautionary note, signaling changes ahead. “Good customer service agents will keep their jobs because they will be able to provide a higher level of service to more customers than ever before,” according to Gene Marks, who wrote the Forbes article. “Mediocre performers that can be replaced by a bot will be replaced by a bot.”

If productivity, customer experience, and profitability improve using an AI tool instead of human beings, marginal employees will be in danger. Today, small and medium-sized businesses cannot afford such a significant investment in advanced AI solutions, but the landscape is changing. As larger corporations continue to invest in AI, the technology will become more accessible and affordable. Whether we want to admit it, we see that AI is replacing employees.

How do you feel about ai replacing employees?

A CEO who replaced 90% of his customer service team last year says it was the right move. Find out why.

John R. DiJulius III, author of The Customer Service Revolution, is president of The DiJulius Group, a customer service consulting firm that works with companies including Starbucks, Chick-fil-A, Ritz-Carlton, Nestle, PwC, Lexus, and many more. Contact him at 216-839-1430 or [email protected].