Governments aren’t typically early adopters, but public agencies in Australia are taking the lead in using bots to improve services.
Digital customer service agents — also known as virtual assistants, chatbots, or softbots — are poised to transform customer service over the next decade. Essentially software algorithms capable of interacting with humans, these agents use big data analytics and technologies like natural language processing and machine learning to develop accurate profiles of users and interact with them.1 According to a report by Grand View Research, about 45% of consumers worldwide, across all industries, now prefer digital agents as the primary point of communication with organizations. This translates into an estimated global market worth $1.25 billion by 2025.2
At most companies, the general strategy is to use digital agents to sift through incoming customer requests (via call centers, websites, and smartphone apps) and then process the most straightforward issues, such as requests for basic information like an account balance — the bulk of customer inquiries at many organizations. More complex issues get passed along to human agents. In that way, digital agents reduce the humans’ workload and associated costs (despite implementation costs, which can be high).3
There is a perception at many companies that these tools can handle only basic inquiries, and that anything else must be handled by human reps. But that is not true. We have studied both public and private sector applications of digital agents in our home market, Australia, over the past four years.4 Through that research, we have found that public sector agencies are already using these technologies to handle complex inquiries from citizens regarding services.
The public sector implementation itself runs counter to the conventional wisdom. In most countries, government entities are slower than businesses to adopt new technologies. They don’t have the budget to make such investments, they struggle with institutional inertia, and they tend to be risk averse, in part due to reputational risk if they get something wrong. Yet since 2015, some public service organizations in Australia, particularly providers of public welfare services, have invested heavily in digital agents. These entities deal with extremely high volumes of interactions and need to increase productivity by facilitating self-service among citizens.