February 27, 2024
By strategically partnering with third-party providers, enterprises can fully harness the potential of gen AI in customer experience management. Learn insights from our latest survey on enterprise readiness for gen AI adoption and how collaborating with providers can help overcome the major obstacles.
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Generative Artificial Intelligence (gen AI) is emerging as a game-changer in customer experience management (CXM) by offering the potential to personalize customer interactions, enhance operational efficiency, and provide a competitive edge. As enterprises adopt gen AI, third-party providers have an increasingly vital role. Let’s explore this further.
Current demand for gen AI
Demand for gen AI solutions is skyrocketing among enterprises across industries. According to a recent Everest Group survey of top executives and CXM leaders of 200 enterprises worldwide, nearly 75% believe gen AI will significantly impact their CXM strategies within the next two years.
Enterprises highlighted personalized interactions, cost reduction, and operational efficiency as the top three drivers for gen AI adoption.
- Personalized customer interactions: Gen AI can produce customized content, product recommendations, dynamic pricing, and marketing campaigns tailored to individual customer preferences, enhancing customer satisfaction and loyalty
- Increased efficiencies and automated CXM processes: Gen AI can empower customer support agents with intelligent tools such as agent assist, next-best-action recommendations, language translation, and accent neutralization. These tools enhance productivity, reduce response times, and enable agents to focus on more complex and value-added tasks. Using gen AI to automate routine tasks and repetitive processes can further boost operational efficiency
- Reduced cost: By automating repetitive tasks, streamlining processes, and enabling advanced data and analytics capabilities, gen AI adoption can increase operational efficiency and productivity, optimizing cost
Current enterprise capabilities
Despite growing gen AI demand, the technology is still nascent. Most enterprises and service providers are investigating gen AI operations use cases or piloting solutions to test feasibility. Given the technology’s evolving nature, enterprises currently face or will likely encounter challenges in adopting and implementing it effectively.
Our survey asked enterprises about their readiness to adopt gen AI to identify significant areas where enterprises need specialized support. Below are the results of the preparedness of enterprises across industries and key parameters:
EXHIBIT 1, Enterprise readiness for gen AI by industry, Source: Everest Group (2023)
Challenges in gen AI implementation
Based on the readiness levels and significant challenges identified by enterprises in the survey, the following overarching issues for enterprises emerged:
- 55% of enterprises reported a shortage of the right talent pool, including AI/ML engineers, data scientists, and software developers needed to integrate gen AI with existing tools and create agent interfaces
- 56% of enterprises highlighted the scarcity of high-quality training data required for training and testing models
- Between 45-50% of enterprises expressed concerns about computing power required for gen AI adoption and their ability to scale
- Regulatory compliance concerning the fairness of the output, data security, and privacy, and misuse of the models also stood out as significant issues for enterprises
How can enterprises navigate these challenges?
The gaps in enterprise capabilities identified in our survey underscore the need for strategic partnerships to ensure successful implementation. While executing gen AI in-house offers greater control over the development and implementation process and allows enterprises to tailor solutions to specific needs, it requires significant internal expertise and resources that may be limited. Outsourcing gen AI implementation can provide access to specialized knowledge and resources, accelerating the implementation process and reducing the time to market for these solutions.
Our survey revealed that nearly 89% of the enterprises are looking to either outsource the implementation of gen AI in customer experience management to specialized AI companies or contact center providers or follow a hybrid approach involving in-house and outsourced development.
EXHIBIT 2, Implementation plan for Gen AI solutions within CXM, Source: Everest Group (2023)
The top three areas where enterprises are seeking service providers’ support are:
- Building gen AI solutions and enhancing technical capabilities: Enterprises need partners who can help train gen AI models on enterprise data, customize foundational models to build tailored solutions, and set up necessary computational systems to run these solutions
- Integrating gen AI solutions with existing technologies: Enterprises need partners who can create necessary bridges to integrate gen AI with existing business intelligence tools, providing a more comprehensive view of customer interactions
- Supporting and complimenting in-house teams: Enterprises need partners who can support in-house technical teams, aid in maintenance, troubleshoot activities, and supervise the functioning of gen AI solutions
Future outlook
Gen AI has the potential to revolutionize CXM, enabling enterprises to deliver personalized, efficient, and innovative customer experiences. However, successfully adopting and implementing gen AI requires overcoming expertise, data quality, and change management challenges. Strategic alliances with third-party providers can bridge these gaps, providing enterprises with the necessary industry-specific knowledge, resources, and guidance to unlock the full potential of gen AI.
Third-party providers have a crucial role in helping enterprises translate the perceived potential of gen AI into practical applications. These partners can help enterprises identify specific CXM use cases where gen AI can deliver tangible benefits, develop gen AI strategies, design and implement solutions, and provide ongoing support to ensure successful gen AI adoption.
Read Everest Group’s Generative AI in CXM: Assessing Enterprise Readiness for this Disruptive Transformation to better understand gen AI in Customer Experience Management and how providers can help enterprises adopt gen AI. If you have questions or want to discuss digital CX strategies and solutions, contact Anubhav Das at [email protected] or Mohit Kumar at [email protected].
Don’t miss our LinkedIn Live, How Will Next-gen Technologies Be Financed in CXM Delivery?
While we recognize the huge potential of generative AI (gen AI) in enhancing Customer Experience Management (CXM), the questions on everyone’s mind are: How do we make it work in real-world scenarios, and where do we start?
Where do you start with your gen AI journey for CXM?
