A Forrester Consulting

Thought Leadership Paper

Commissioned By NICE inContact

July 2019

AI-Infused Contact Centers

Optimize Customer
Experience
Develop A Road Map Now For A Cognitive
Contact Center
 Table Of Contents
1 Executive Summary
2 Contact Centers Are The
Cornerstone Of Customer
Experience
4 Contact Center Challenges Hinder
Business Success
5 Contact Center Leaders: Look
Beyond AI Hype To Its Value-Add
8 Act Now To Lay The Groundwork
For AI
9 Key Recommendations
10 Appendix

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 Executive Summary
Contact centers have long been a touchstone for organizations’
customer experience (CX). As often one of the first interactions, contact
centers play an integral role in shaping how customers view and interact
with a brand.
But evolving customer expectations and technologies have caused
organizations to rethink certain aspects of their contact centers; many
have integrated cloud, omnichannel, and artificial intelligence (AI)
capabilities into their approach. While omnichannel and cloud have
long been more straightforward to implement, many aspects of AI
For AI to deliver at remain unexplored territory. For AI to deliver at its highest potential,
its highest potential, organizations must carefully craft an AI strategy to optimize customer
organizations must journeys, agent experience, and, ultimately, customer satisfaction.
In March 2019, NICE inContact commissioned Forrester Consulting
carefully craft to evaluate drivers of AI adoption in contact center applications. With
an AI strategy to all the industry focus on AI enabling enhanced self-service, what
optimize customer gets lost is where it will lay the groundwork for the evolution to the
cognitive contact center. To explore this topic, Forrester conducted an
journeys, agent online survey with 307 contact center technology decision makers at
experience, and, global companies. We found that while most companies are currently
implementing or planning to implement AI-infused applications to
ultimately, customer augment contact center capabilities, they experience a variety of
satisfaction. challenges in doing so. However, the perceived benefits far outweigh
the risks posed by these challenges, and firms should look beyond
chatbots to get the most out of AI for their contact centers.

KEY FINDINGS
›› Contact centers are key to achieving business goals. Almost all
firms agree that their contact centers are instrumental in achieving
their business priorities, including improving CX (98%), increasing use
of data insights (87%), and improving products and services (83%).
›› However, challenges in the contact center are detrimental to
business performance. Ninety-five percent of contact center
decision makers report experiencing multiple challenges, including
meeting growing customer expectations for frictionless, fast service.
These challenges prevent companies from maximizing the value
contact centers can deliver to the business.
›› AI boosts contact center capabilities but requires a thoughtful
road map for implementation. Sixty-four percent of respondents
say their firms are planning to increase their investments in AI for their
contact centers over the next year. While the list of benefits spans
customer, agent, and business benefits, companies must caution
against getting caught in the hype around AI. To get the most out of
their investments, companies need a concrete strategy and road map
for implementing AI.

1 | AI-Infused Contact Centers Optimize Customer Experience

Contact Centers Are The Cornerstone
Of Customer Experience
When customers connect directly with a business, they often do so
through a contact center. And how that contact center manages those
frontline interactions shapes customers’ experiences and impressions
of that business.
To ensure those interactions deliver positive results for the business
and its customers, companies need to make contact centers the
1
foundation of their CX strategy. CX teams and contact center
leaders must collaborate closely to develop a contact center road
map that integrates into the overall CX strategy and includes support
for omnichannel, cloud, and artificial intelligence. Just as moving
to the cloud and adding omnichannel capabilities are essential to
modernizing the contact center for the digital world, adding AI is Most companies
essential to elevating the customer and agent experience. An AI- agree that their
infused cognitive contact center can help personalize agent/customer
matching, augment agent capabilities, and offload management tasks, contact centers
enabling firms to focus more on their business strategies to strengthen have a significant or
customer loyalty, differentiate themselves from the competition, and
reduce their costs.
2 substantial impact on
While AI can boost self-service and help businesses deliver a more
their ability to achieve
personalized experience, it can also create concerns over potential business priorities for
job loss, require additional agent training, and result in longer call
handle times as agents are reserved to handle the more difficult
the coming year.
and challenging interactions. Despite these concerns, the value that
AI delivers makes it a critical component of any modern, cognitive
contact center that needs to improve performance, productivity, CX,
and business results.
Our study with 307 contact center technology decision makers
confirms the strong correlation between contact centers and achieving
business goals, including (see Figure 1):
›› Improving customer experience. For most industries, a large
3
percentage of customers need support from contact center agents.
The quality of service from agents can determine the customer’s
loyalty, how much of their wallet they share, and the ability to attract
or discourage new customers through word of mouth. Virtually all
(98%) companies in our study agree that their contact centers have
a significant or substantial impact on their ability to improve CX.
›› Increasing data insights in business decisions. Contact centers
are rich with customer data. In our study, 87% of respondents
believe that harnessing this data for insights would enable their
companies to deliver timely and contextually relevant customer
experiences, identify new revenue streams, or dynamically respond
to market changes.

2
 ›› Improving innovation. Whether revolutionizing products or services,
contact centers can be a wedge into innovation as a service
differentiator. And 83% of respondents tell us that their contact
centers have a substantial or significant impact in doing just that. Companies struggle to
›› Growing revenue. Positive customer experiences drive loyalty. Firms maximize the value of
can see their increased CX efforts translate into an enhanced bottom
4
their contact centers.
line. In this study, 82% of respondents confirm that their companies’
contact centers improve their ability to grow revenue.
The positive impact of the contact center on business success is well-
acknowledged, but companies lack a clear strategy for maximizing the
value of their contact centers.

Figure 1
“What impact does your contact center have in achieving each business
goal?”
Substantial impact Significant impact

Improve customer experience 34% 62%

Increase use of data insights in 98% believe their

44% 43%
business decisions contact centers have
Improve our products and services 44% 39% a significant or
substantial impact on
Improve our ability to innovate 41% 42%
their ability to
Grow revenue 41% 41%
improve CX.

Other 40% 20%

Base: 307 contact center technology decision makers at global companies with
contact centers
Source: A commissioned study conducted by Forrester Consulting on behalf of
NICE, March 2019

3
Contact Center Challenges Hinder
Business Success
Despite recognizing the contact center’s ability to deliver on business
objectives, the performance of the contact center continues to decline.
We found that companies grapple with (see Figure 2):
›› Rising pressure on agents. The age of the customer has brought an
avalanche of new interaction channels to serve customers how, when, and
where they want. Agents not only need training on these new channels,
but on any AI solutions that are deployed to augment their capabilities.
The vast majority — 88% — of contact center technology decision
makers in our study agree or strongly agree that consumers increasingly
engage with customer service across channels and devices. With this
increase in interactions and interfaces, contact center agents are left to
handle snowballing requests for service from a myriad of channels.
The proliferation of service across channels demands more
knowledgeable agents who can seamlessly serve customers
regardless of the interaction point. To meet growing customer
expectations, 87% of respondents tell us that contact center agents
need to be highly skilled in interacting across not just voice but also
digital channels.

Figure 2

Rising agent pressure Inefficient tools Operational hurdles

PEOPLE

88% agree that

consumers
55% The tools we use are outdated. • Hiring/retaining
agents
increasingly • Balancing resources
engage with 50% We have not gained agent
to meet service-level
customer service efficiency/productivity.
goals
across channels PROCESS
40% The tools we use don’t add value
and devices. • Difficulty forecasting
to customer experience/service.
• Poor visibility into
40% We’re not seeing the benefits we operations
were expecting.
87% agree that contact
center agents need 38% The tools we use were more TECHNOLOGY
to be highly skilled expensive than we budgeted for. • Lack of integration
in interacting between apps
across not just 38% We are unable to meet customer • Outdated/unstable
voice but also needs in real time. technology
digital channels.
35% We don’t understand how to use • Too many apps or
our current tools effectively. data sources

Base: 307 contact center technology Base: 40 contact center technology Base: 307 contact center technology
decision makers at global companies with decision makers who are not satisfied with decision makers at global companies with
contact centers their current tools/capabilities contact centers

Source: A commissioned study conducted by Forrester Consulting on behalf of NICE, March 2019

4 | AI-Infused Contact Centers Optimize Customer Experience

›› Inefficient tools and capabilities. “The contact center technology
ecosystem has grown more complex as new communication channels
and touchpoints have become available, making good service hard to
5
deliver.” Only 31% report complete satisfaction with the tools in their
contact centers. The unprepared majority blame outdated tools that don’t
deliver on expectations for their business, their customers, or their agents.
›› Operational hurdles. Regardless of firmographics, 95% of companies
across the globe face challenges in the contact center with people
(hiring and retaining agents, balancing resources to meet service-level
goals), process (difficulty forecasting, poor visibility into operations), and
technology (lack of integration between applications, outdated/unstable
technology, too many applications or data sources).
As challenges in the contact center persist, they hinder companies from
extending and maximizing the value contact centers can deliver to the
business.

Contact Center Leaders: Look Beyond

AI Hype To Its Value-Add
Our research demonstrates that disparate and underperforming
technologies adversely affect customer satisfaction and impede business
success. Companies must not only modernize their contact centers, but do
so in a way that protects their investments over time and that delivers the
greatest qualifiable benefits. Incorporating AI into the contact center is one
way to achieve these goals.
This approach is evident in our research as most companies in our study are
actively planning or currently implementing AI in contact center applications
to (see Figure 3):
›› Personalize agent and customer matching. Almost 60% of contact
center technology decision makers tell us their companies are planning or
currently implementing automatic call distribution (ACD), matching agents
to customers through their profiles to improve CX.
›› Augment agent capabilities. Whether it’s agent desktop automation/
after-call work (robotic process automation) or bots (chat and voice), over
60% of companies are actively planning or currently undergoing these
implementations to enhance agent productivity.
›› Augment management tasks. To support quality assurance and
workforce management teams, companies also show high activity in
embedding AI in workforce management (57%), quality monitoring (50%),
and customer feedback (49%) applications.
Unsurprisingly, interest in AI is strong. Companies have implemented AI to
augment the capabilities of a wide range of applications, helping to address
the dual challenges of productivity and customer satisfaction.
The benefits of AI are well-known. Forrester’s research has found that
“AI streamlines inquiry capture and resolution. It optimizes case routing,
classification, and schedule management. It extracts useful information
from voice and digital conversations to quickly surface trends in issues and
6
customer sentiment that may affect customer retention and loyalty.”

5 | AI-Infused Contact Centers Optimize Customer Experience

Figure 3
“What are your company’s plans to embed artificial intelligence (AI) in each of the following contact center applications?”
Not Interested Planning to Planning to Currently Already Expanding or
interested but no plans implement in implement implementing implemented upgrading
to implement the next 12 to within the next implementation
24 months 12 months
3%
Chatbots or conversational voice bots 7% 19% 22% 21% 19% 9%

1%
Customer feedback 10% 15% 24% 37% 12%
1%
3%
Agent desktop automation/after-call work
16% 22% 23% 24% 7%
(RPA)
3%
2%
Workforce management 22% 12% 23% 29% 9%
2%
1%
Quality monitoring 13% 15% 22% 32% 13%
2%
4%
Automatic call distribution (ACD) matching
16% 20% 23% 27% 8%
agents to customers through their profiles

Base: 307 contact center technology decision makers at global companies with contact centers
Source: A commissioned study conducted by Forrester Consulting on behalf of NICE, March 2019

Companies in our study realize benefits for customers, agents, and the
business as a result of AI applications in the contact center. They expect
AI to provide a boost by:
›› Increasing self-service and reducing the need for agent
assistance. In our study, 80% of respondents agree that AI would
help their contact centers increase agentless interactions. However,
this strategy does not necessarily translate to a reduction in agent
headcount. In fact, 74% of respondents tell us the number of agents
in their contact centers will grow or stay the same this year. So,
while AI will handle simpler, repetitive interactions, agents are still
needed to manage the more complex, higher-value interactions that
require advanced skills and additional time to resolve. But all is well
as agents prefer to spend their time on more impactful interactions
than provide repetitive service for easy issues. So ironically enough,
7
chatbots do allow human agents to feel less like automatons.
›› Gaining an edge over competitors. According to 79% of
respondents, AI would enable them to have the upper hand
over competitors as they deliver timely and contextually relevant
customer experiences. AI also improves agents’ engagement, which
translates to happier customers. And research reveals a statistical
correlation between more engaged employees and revenue growth:
A 5% improvement in employee engagement leads to a 3% increase
8
in revenue.

6 | AI-Infused Contact Centers Optimize Customer Experience

 ›› Improving customer interactions with agents. Close to 75%
believe that AI improves customer service in the contact center.
Augmenting QA teams with AI allows companies more time to coach
and train agents, while more sophisticated routing matches the right
customer with the right agent to improve issue resolution. Forrester
estimates that “companies will continue to use AI for efficiency
gains and to deliver more effective experiences. AI will help monitor
customer journeys and proactively engage customers at opportune
9
times to boost revenue and conversion.”
The belief in and value of AI is further highlighted by the 64% of
respondents whose companies plan to increase their AI investments
in the contact center in the next 12 months (see Figure 4). Moreover,
our findings suggest that AI is not a “one-and-done” initiative. A pilot
investment will likely lead to subsequent investments. Therefore, it’s
necessary to consider the full scope for how AI can be used, and
creating a road map is a smart first step.

Companies adopt AI to address the biggest

issues they face in the contact center.

Figure 4
“Thinking about the next 12 months, what are your company’s investment plans to support AI in the contact center?”

3%
Don’t know
0%
Decrease investment

33%
Keep investment the same

64%
Increase investment

Base: 290 contact center technology decision makers who currently have/are planning to implement AI
Source: A commissioned study conducted by Forrester Consulting on behalf of NICE, March 2019

7
Act Now To Lay The Groundwork For AI
Despite burgeoning interest, AI is not a shortcut to mask fundamental
limitations in call center capabilities, e.g., relying on a chatbot in lieu of
an interactive voice response (IVR) or full digital channel capabilities.
In this study, 77% of contact center technology decision makers agree
that while AI increasingly peels off simpler customer service requests,
it also increases the need for agents to develop additional skills to deal
with more complex and higher-value customer inquiries.
Companies can get swept up in the hype around AI by making the
common mistake of solely focusing on cost reductions automation can
provide. These misconceptions and lack of a more expansive view of
AI constrain enterprises from optimizing their customer journeys, agent
experience, and ultimately customer satisfaction.
It’s no surprise that 89% of respondents experience challenges with
implementing AI in the contact center. While no single challenge
surfaces across the board, companies cite the lack of internal resources
to groom data for AI apps, insufficient expertise to manage or utilize AI
in the contact center, and difficulty finding the right AI applications or
partners. To overcome AI implementation challenges, companies must
seek more training, expertise, and support when implementing AI (see
Figure 5). The right partner can do most of the heavy lifting.
Follow Forrester’s recommendations to plan your AI road map.

Figure 5
“What steps has your company taken to overcome AI implementation
challenges?”

44% Trained internal staff on AI tools and applications

95% of companies
40% Utilized the AI application provider training and implementation support
services
are taking steps to
overcome AI
38% Hired AI skilled technical staff to help procure and manage contact
center AI applications
implementation
challenges, primarily
37% Hired external support to help us optimize the value of AI tools
by seeking more
training, expertise,
31% Initiated a series of proof-of-concept projects for AI applications to
and support.
help expand our experience and knowledge

5% None of these; we have not taken any steps to overcome our challenges

Base: 249 contact center technology decision makers who currently have/are
planning to implement AI and experience challenges with implementation
Source: A commissioned study conducted by Forrester Consulting on behalf of
NICE, March 2019

8 | AI-Infused Contact Centers Optimize Customer Experience

 Key Recommendations
The path to a cognitive contact center is made up of much more than
just chatbots. AI can augment not only agents in their key role of serving
customers, but also quality assurance, workforce management, and
business analysts looking to refine and enhance CX.
Forrester’s in-depth survey of contact center technology decision
makers about AI in contact center applications yielded several important
recommendations:
Take an “outside-in” approach by developing a deep understanding
of customer journeys. As baseball player and coach Yogi Berra once
said, “If you don’t know where you are going, you’ll end up someplace
else.” Despite the attractiveness of investing in chatbots to deflect live
interactions, the better place to start with AI is comprehensive journey
analytics, spanning all channels and the escalation paths from self-
service to live agents. This approach will expose opportunities to boost
customer satisfaction, reduce costs, and augment capacity of your
contact center team.
Ensure chatbot investments not only achieve automation goals but
customer satisfaction as well. The hard-dollar benefits of automation
are always top of mind for customer service organizations as they are
under constant pressure to optimize. But in addressing the customers’
desire for quick answers with self-service, contact centers need to
ensure they are not sacrificing an effective and efficient customer
experience.
Empower agents with enhanced AI-enabled desktop tools that
incorporate customer intent and context. Customers dislike having
to repeat themselves. AI-enabled desktop tools can help guide agents
through a more effective and efficient interaction with a customer.
Balance cost reductions with agent development and customer
satisfaction. AI will augment your quality assurance team’s ability
to coach, train, and develop agents so they improve their skills and
maintain their motivation to deliver great CX.
AI-powered workforce management meets the need for a more
flexible staffing strategy. The search for customer service talent
continues to become more challenging, and the workforce is demanding
more flexible options such as shorter shifts and work-from-home
capabilities. Workforce managers can leverage AI to develop more
flexible and accurate schedules to meet this challenge.
AI is not an out-of-the-box technology. Lastly, organizations will need
help understanding how AI is augmenting and enhancing their contact
center applications and performance. Start with defined use cases for
AI, and then use each AI implementation as an opportunity to learn and
better prepare for the next AI project. Lean on the application providers
themselves to help design, implement, deploy, and train your staff to
learn not only how the applications operate but how they can improve
the performance of your contact center and business. The critical factor
is how data is updated to guide the evolution of the AI models.

9 | AI-Infused Contact Centers Optimize Customer Experience

Next Steps
See how ready you are to implement AI in the contact center. Take the assessment to compare against your peers.

Appendix A: Methodology
In this study, Forrester conducted an online survey of 307 organizations in the US, the UK, and Australia to evaluate
adoption of AI in contact centers. Survey participants included decision makers in IT, customer experience, and
contact centers who make contact center technology decisions. Questions provided to the participants asked about
current contact center tools, plans to adopt AI in contact center applications, and challenges with getting started.
Respondents were offered an incentive as a thank you for time spent on the survey. The study began and was
completed in March 2019.

Appendix B: Demographics/Data
GEOGRAPHY

To qualify, companies must:

• Have a contact center.
US 45% UK 44%
• Not outsource their contact center functions.

AU 11% COMPANY SIZE

26%
20,000 or more
employees
INDUSTRY 50%
(Only top 10 listed) 1,000 to 4,999
employees
Financial services and/or insurance 14%
23%
Retail 12% 5,000 to 19,999
employees
Technology and/or technology 11%
services
Manufacturing and materials 10% AGENT SEAT COUNT

Government 9% 11%
29%
1 to 49 agent seats
500 or more
Business or professional services 6% agent seats 13%
50 to 99 agent seats
Healthcare 5%

Education and/or nonprofits 5%

21% 27%
Travel and hospitality 4% 250 to 499 100 to 249 agent seats
agent seats
Telecommunications services 4%

Base: 307 contact center technology decision makers at global companies with contact centers
Note: Percentages may not total 100 because of rounding.
Source: A commissioned study conducted by Forrester Consulting on behalf of NICE, March 2019

10 | AI-Infused Contact Centers Optimize Customer Experience

 RESPONDENT LEVEL DEPARTMENT
16%
Customer experience
36% 38%
42%
Contact center
16%
9%
41%
C-level Vice Director Manager IT
executive president

CONTACT CENTER ROLE

Management 98%
Operations 22%

Base: 307 contact center technology decision makers at global companies with contact centers
Note: Percentages may not total 100 because of rounding.
Source: A commissioned study conducted by Forrester Consulting on behalf of NICE, March 2019

Appendix C: Supplemental Material

RELATED FORRESTER RESEARCH
“Future-Proof Your Customer Service: Build An AI-Infused Cognitive Contact Center,” Forrester Research,
Inc., February 23, 2018.

Appendix D: Endnotes
1
Source: “Win Funding For Your Customer Service Project,” Forrester Research, Inc., February 26, 2019.
2
Sources: “Future-Proof Your Customer Service: Build An AI-Infused Cognitive Contact Center,” Forrester
Research, Inc., February 23, 2018, and “Build An Outside-In Contact Center Road Map,” Forrester Research,
Inc., August 7, 2018.
3
Source: “Build An Outside-In Contact Center Road Map,” Forrester Research, Inc., August 7, 2018
4
Source: “Win Funding For Your Customer Service Project,” Forrester Research, Inc., February 26, 2019.
5
Source: “Build An Outside-In Contact Center Road Map,” Forrester Research, Inc., August 7, 2018
6
Source: “The Three Customer Service Megatrends In 2019: As AI Eats Jobs, Agents Are More Valued,”
Forrester Research, Inc., January 17, 2019.
7
Source: “New Tech: Conversational AI For Customer Service, Q2 2019,” Forrester Research, Inc., May 23,
2019.
8
Source: “Stop Trying To Replace Your Agents With Chatbots,” Forrester Research, Inc., April 17, 2019.
9
Source: “The Three Customer Service Megatrends In 2019: As AI Eats Jobs, Agents Are More Valued,”
Forrester Research, Inc., January 17, 2019.

11 | AI-Infused Contact Centers Optimize Customer Experience