How to Use ChatGPT in Customer Service: 2026 Guide

Now that we’ve all seen what ChatGPT can do, it’s natural to begin casting about for ways to put it to work. An obvious place where a generative AI language model can be used is in contact centers, which involve a great deal of text-based tasks like answering customer questions and resolving their issues.

But is ChatGPT ready for the on-the-ground realities of contact centers? What if it responds inappropriately, abuses a customer, or provides inaccurate information?

We at Quiq pride ourselves on being experts in customer experience and customer service, and we’ve been watching recent developments in generative AI for some time. This piece presents our conclusions about what ChatGPT is, the ways in which ChatGPT can be used for customer service, and the techniques that exist to optimize it for this domain.

What is ChatGPT?

ChatGPT is an application built on top of GPT-4, a large language model. Large language models like GTP-4 are trained on huge amounts of textual data, and they gradually learn the statistical patterns present in that data well enough to output their own, new text.

How does this training work? Well, when you hear a sentence like “I’m going to the store to pick up some _____”, you know that the final word is something like “milk”, “bread”, or “groceries”, and probably not “sawdust” or “livestock”.

This is because you’ve been using English for a long time, you’re familiar with what happens at a grocery store, and you have a sense of how a person is likely to describe their exciting adventures there (nothing gets our motor running like picking out the really good avocados).

GPT-4, of course, has none of this context, but if you show it enough examples, it can learn to imitate natural language quite well. It will see the first few sentences of a paragraph and try to predict what the final sentence is.

At first, its answers are terrible, but with each training run its internal parameters are updated, and it gradually gets better. If you do this for long enough, you get something that can write its own emails, blog posts, research reports, book summaries, poems, and codebases.

Can ChatGPT be used for customer service?

Short answer: not on its own.

While tools like ChatGPT can support customer service workflows, relying on them as a standalone solution introduces serious risks. Here’s why.

It makes things up (and sounds confident doing it)

One of the biggest issues is hallucination, where the model generates incorrect answers that sound completely believable. In customer service, this can mean:

  • Invented refund policies
  • Incorrect pricing or product details
  • Fake troubleshooting steps

These errors are not rare edge cases that happen every now and then in customer inquiries. They happen because the model predicts likely words, not verified facts.

Even worse, it often delivers these answers with high confidence, which makes them harder to catch and more damaging to trust.

It doesn’t know your business

ChatGPT is trained on general internet data, not your:

  • Internal policies and knowledge base data
  • Product catalog
  • Customer history and relevant customer queries
  • Real-time updates

That means it can’t reliably answer company-specific questions unless heavily customized. Out of the box, it simply lacks context, which leads to vague or irrelevant responses and it cannot address customers’ concerns well.

For customer support, that’s a deal breaker.

It can’t guarantee accuracy or compliance

In industries like finance, healthcare, or legal services, even small mistakes carry real consequences.

  • Companies can be legally liable for incorrect chatbot responses
  • AI errors from automated responses can lead to compliance violations or financial loss
  • Wrong advice can damage customer relationships permanently

Unlike human agents, ChatGPT has no built-in accountability or understanding of risk. If you want accurate responses that actually improve customer satisfaction, relying on ChatGPT alone is dangerous.

It raises data privacy concerns when handling customer inquiries

Using ChatGPT for support often involves sharing customer data. That introduces risk:

  • Conversations may be stored or used for training
  • Sensitive information could be exposed
  • Compliance with regulations like GDPR becomes harder as data gets passed through multiple systems

This is especially problematic for businesses handling personal or financial data.

It lacks true understanding and judgment, ultimately affecting customer experience

ChatGPT can mimic conversation, but it does not:

  • Understand customer intent in complex customer issues
  • Handle emotional or sensitive situations well and give personalized responses
  • Apply judgment in edge cases

It can escalate frustration instead of resolving it, especially when a customer needs nuance or empathy beyond the average call center script.

It still needs human customer service agents to work properly

Even in advanced setups, companies don’t rely on ChatGPT alone. They use:

  • Human review and escalation paths
  • Structured knowledge bases
  • Guardrails and validation layers

Without these, results become inconsistent and risky. In fact, most real-world deployments combine AI with human oversight because fully automated support is still unreliable.

So, where does ChatGPT for customer service actually fit?

ChatGPT works best as a supporting tool, not a replacement. For example:

  • Drafting replies for agents
  • Summarizing tickets
  • Assisting with internal documentation such as knowledge base articles

But when it comes to customer-facing support, especially in high-stakes scenarios, it still falls short without a proper system around it.

Why purpose-built customer service platforms make more sense

If ChatGPT alone is not reliable for handling real customer interactions, the next step is not to abandon AI. It is to use it inside systems that are built for the realities of the customer service space.

This is where platforms like Quiq come in. They take large language models and connect them to real workflows, real data, and real oversight. Instead of acting like a generic customer service chatbot, the AI becomes part of a structured system that customer service leaders can actually trust in production environments.

Built for real customer service interactions

Standalone tools do not reflect how support actually works. Real teams deal with queues, SLAs, escalations, and multiple channels at once.

Purpose-built platforms are designed around these realities and key challenges:

  • Intelligent routing ensures customer interactions go to the right customer support agents based on intent, priority, or account value
  • Omnichannel support brings chat, voice, SMS, and social messaging into one place, so customer service agents are not switching tools
  • Context is preserved across conversations, giving every customer service representative full visibility into previous interactions, orders, and issues

This structure removes friction from daily operations. Instead of reacting to messages one by one, customer service teams can manage volume in a controlled, predictable way. Once you’re past the initial setup, you can easily generate responses that are accurate, helpful and empathetic.

It also improves consistency. When workflows are standardized, every customer interaction follows a defined path, which reduces errors and helps deliver exceptional customer service at scale.

Grounded in your data, not generic knowledge

One of the biggest gaps with a standalone customer service chatbot is that it relies on general knowledge instead of your business context.

Purpose-built platforms solve this by connecting AI directly to:

  • Internal knowledge bases and help centers
  • CRM systems with detailed customer history
  • Order management and billing systems
  • Product documentation and release notes

This changes how responses are generated. Instead of guessing, the AI pulls from verified sources tied to your business.

For example, when handling customer interactions about billing issues or subscription changes, the system can reference real account data instead of producing a generic answer. That leads to fewer mistakes and faster resolutions.

For customer service leaders, this is critical. Accurate answers directly impact customer satisfaction, and grounding AI in real data is what makes that possible.

AI with guardrails and human oversight for true customer satisfaction

Uncontrolled AI is risky. That is why production systems rely on layered safeguards.

Purpose-built platforms introduce guardrails such as:

  • Predefined rules that limit what the AI can say in sensitive scenarios
  • Confidence thresholds that trigger escalation when the model is unsure
  • Approval workflows where customer support agents review or edit responses before they are sent

This ensures that AI supports customer service agents rather than replacing judgment.

Human oversight remains central when AI answers customer inquiries. Complex or emotionally sensitive customer interactions can be handed off instantly to a customer service representative, while routine questions are handled automatically.

This hybrid approach is what allows companies to scale without sacrificing quality. Customer service teams stay in control, and AI operates within clearly defined boundaries.

Designed for scale in customer support teams, without breaking quality

Scaling support is not just about handling more tickets. It is about maintaining quality across thousands of customer interactions.

Standalone tools often break down under pressure because they lack structure. Purpose-built systems are designed to:

  • Handle spikes in volume without overwhelming customer service agents
  • Automate repetitive requests like order status, refunds, or FAQs
  • Maintain consistent tone and accuracy across every response

They also provide visibility into performance. Customer service leaders can track metrics such as response times, resolution rates, and customer satisfaction across channels.

This makes it easier to identify bottlenecks and improve processes over time.

In fast-growing companies, this kind of infrastructure is essential. Without it, scaling support usually leads to slower responses and inconsistent experiences.

Better outcomes across the entire customer journey

When AI is properly integrated into a customer service platform, its impact goes beyond handling tickets.

It improves the entire experience by:

  • Assisting customer service agents with suggested replies based on past customer interactions
  • Reducing response times while keeping answers accurate and relevant
  • Ensuring consistent communication across every touchpoint, from first contact to resolution

It also supports proactive engagement. Instead of waiting for issues, systems can trigger messages based on behavior, such as abandoned carts or failed payments.

Over time, this leads to stronger relationships and higher customer satisfaction. Customers get faster answers, fewer errors, and a smoother experience overall.

For businesses competing in the customer service space, this is a clear advantage.

Where this leaves ChatGPT

ChatGPT still plays a role, but not as a standalone solution or a customer-facing chatbot.

On its own, it behaves like a general-purpose customer service chatbot, which makes it unreliable for real-world use. It lacks the structure, data access, and safeguards needed for consistent performance.

Inside a purpose-built platform, it becomes far more useful. It can assist customer support agents, speed up workflows, and improve response quality, all while operating within controlled systems.

For customer service teams and customer service leaders, the takeaway is simple. AI is valuable, but only when it is implemented in a way that supports real workflows, real data, and real accountability.

Where ChatGPT actually works in customer service

While ChatGPT is not reliable as a standalone solution, it can still improve customer service when used in the right context. The key is keeping it behind the scenes, supporting people instead of replacing them.

Drafting replies for support requests

One of the most practical uses is helping customer service agents respond faster.

Instead of writing every reply from scratch, agents can use ChatGPT to:

  • Generate human-like responses based on the context of the request
  • Rephrase messages to match tone and clarity
  • Turn rough notes into polished replies

This is especially useful when dealing with high volumes of support requests. It reduces writing time without removing human oversight.

Agents still review and edit everything, which keeps responses accurate and aligned with company policies.

Summarizing support tickets and conversations

Customer interactions often span multiple messages, channels, and agents. That makes it hard to quickly understand what is going on.

ChatGPT can:

  • Summarize long support tickets into short, clear overviews
  • Highlight key issues, actions taken, and next steps
  • Help new agents jump into ongoing conversations without confusion

This improves handoffs between customer support agents and reduces the risk of missed details.

It also helps managers review conversations faster and spot patterns across tickets.

Handling repetitive and low-risk queries

For simple, repeatable questions, ChatGPT can assist with first-line responses.

Examples include:

  • Basic product questions
  • Order status updates
  • Account or login guidance

These types of support requests do not usually require deep judgment. When paired with verified data sources, ChatGPT can respond quickly and consistently.

This frees up customer service agents to focus on more complex or sensitive cases, including human interactions that require empathy or decision-making.

Assisting with customer feedback analysis

Customer feedback is often scattered across emails, chats, and surveys.

ChatGPT can help by:

  • Grouping feedback into themes or categories
  • Identifying recurring complaints or feature requests
  • Summarizing large volumes of responses into key insights

This gives customer service teams a clearer view of what customers are saying, without manually reviewing every message.

Over time, this can improve customer service by helping teams prioritize fixes and respond to common issues more effectively.

Supporting agents during difficult conversations

Handling angry customers is one of the hardest parts of the job.

ChatGPT can act as a support tool by:

  • Suggesting calm, professional responses in tense situations
  • Helping agents adjust tone to avoid escalation
  • Providing alternative ways to explain policies or decisions

This does not replace human judgment, but it gives agents a starting point when they are under pressure.

It can be especially helpful for less experienced customer service representatives who are still learning how to manage difficult interactions.

Internal knowledge and training support

ChatGPT is also useful internally, not just in live conversations.

Teams can use it to:

  • Answer internal questions about processes or policies
  • Generate training materials based on past support tickets
  • Help new hires learn how to handle common scenarios

This reduces the time it takes to onboard new customer support agents and ensures more consistent responses across the team.

Final thoughts: ChatGPT is a tool, not a solution

ChatGPT has earned its place in the conversation around AI, and for good reason. It can generate human-like responses, support customer service agents, and speed up how teams handle support requests.

But as you’ve seen, it breaks down in the areas that matter most for real customer interactions and more complex tickets. It lacks business context, struggles with accuracy, introduces risk around compliance and data privacy, and still depends heavily on human oversight to avoid mistakes.

That’s why more customer service leaders are moving away from standalone tools and toward purpose-built platforms like Quiq.

Quiq takes everything that makes ChatGPT useful and removes the parts that make it risky:

  • Instead of guessing, it pulls from your actual data and systems
  • Instead of operating alone, it works alongside customer support agents with clear guardrails
  • Instead of inconsistent answers, it delivers controlled, reliable responses across every customer interaction
  • Instead of adding risk, it is built for compliance, security, and real business use

The result is not just faster replies. It is better customer satisfaction, more confident customer service teams, and a system that can handle real-world complexity without falling apart.

If your goal is to improve customer service in a meaningful way, ChatGPT on its own will not get you there. But used within a platform like Quiq, it becomes part of something far more reliable, scalable, and ready for the demands of modern customer service.

Get a free demo of Quiq to find out the real capabilities of AI in CX.

LLM Integration: How-to Guide for Businesses

Key takeaways:

  • LLM integrations turn static products into interactive systems by connecting large language models to real workflows and business data
  • The real value comes from context, not just the model, retrieval and clean data are what make responses accurate and useful
  • Without guardrails and clear prompt design, LLM outputs can become inconsistent or unreliable in production
  • A successful integration depends on the full system, backend logic, frontend experience, and data flow all matter
  • Most issues come from poor planning, unclear use cases and weak success metrics lead to wasted effort
  • Real-world testing is critical, user inputs are messy and expose problems that demos never show
  • LLM integrations require ongoing work, continuous monitoring and iteration are what drive long-term performance

Large language models have revolutionized just about every aspect of how we work and think in the past few years, and it seems like every business out there wants to add AI to their platforms. But does it make sense to add an LLM integration to your SaaS tool, website, or business model?

Today, we show you what an LLM integration is, the pros and cons of adding AI models to your current setup, and a full guide on how to make those integrations go live.

What is an LLM integration, and how does it work?

An LLM integration is the process of connecting large language models to your existing systems so they can read, reason, and respond using your business data. Instead of treating an LLM like a standalone chatbot, you plug it into your product, support stack, CRM, or internal tools and let it operate inside real workflows.

At a basic level, it works through API requests. You send a request to an API endpoint provided by the model vendor, authenticate it with an API key, and include the input you want the model to process. That input could be a customer message, a support ticket, or structured data from your backend. The model returns a response, which your application then displays or uses to trigger an action.

That’s the simple version. In practice, most useful implementations go a step further with retrieval augmented generation. Instead of relying only on what the model already knows, your system fetches relevant data, like help center articles, past conversations, or account details, and includes it in the request. The model then generates a response grounded in that context, which makes answers more accurate and business-specific.

Here’s how it typically plays out in a real workflow:

  • A user asks a question in your app or support channel
  • Your system pulls relevant data from internal sources
  • You send everything to the model via an API request
  • The model generates a response using that context
  • The response is returned through the API endpoint and shown to the user

This is why LLM integration is so powerful: you are turning your existing data and systems into something that can interact, assist, and act in real time.

The benefits of adding an LLM integration to your product or service

Adding an LLM integration changes how your product communicates, supports users, and delivers value.

More natural communication

Most products still rely on predefined responses, rigid flows, or static content. That can create friction, especially when users ask something slightly outside the expected path.

With LLMs, you can generate human-like language that adapts to each situation. The tone can match your brand. The level of detail can be adjusted based on the question. Instead of forcing users through menus or forms, your product can respond directly.

This matters most in support, onboarding, and search experiences. Users get answers faster, and they do not feel like they are talking to a script.

Better control over outputs

There is a misconception that LLMs are unpredictable. In reality, you can guide them quite precisely.

You define the desired format for responses depending on the use case. For example, you can return short answers for chat, structured bullet summaries for internal tools, or step-by-step instructions for onboarding flows.

This level of control is especially useful in web apps where consistency matters. You are shaping how information is presented across your product.

Works with your existing stack

One of the biggest advantages is how easy LLMs are to integrate from a technical perspective.

They rely on API interactions, which means you can connect them to your product using almost any modern stack. Most teams already work with programming languages like JavaScript or Python, so adding LLM capabilities does not require a complete rebuild.

You send a request, include the necessary context, and receive a response. From there, you decide how that response is used, whether it is shown to a user, stored, or used to trigger another action.

Responses that reflect your business

Out of the box, LLMs are general-purpose, which is not enough for real products.

When you connect them to your own data, you unlock tailored responses that reflect your business logic, content, and users. That could include pulling in account details, referencing internal documentation, or using past interactions to shape the answer.

This is where the experience improves significantly: users are now getting answers that feel relevant and accurate.

New product capabilities without heavy rebuilds

Once you have the integration in place, you can start building new features on top of it without major engineering effort.

Common examples include:

  • intelligent search that understands intent instead of keywords
  • automated support that can handle a large portion of incoming questions
  • in product assistants that guide users through complex workflows
  • internal tools that help teams find information and complete tasks faster

The key point is that you are not replacing your product. You are extending it. And because everything runs through API interactions, you can keep iterating without slowing down your team.

The downsides of integrating LLMs

LLM integrations can unlock a lot of value, but they are not plug-and-play. Once you move beyond simple demos, a few consistent challenges show up. If you ignore them, you end up with unreliable features or frustrated users.

Unpredictable outputs

LLMs work with natural language, not fixed logic. That makes them flexible, but also harder to control.

The same input can produce slightly different answers. Small changes in user inputs can lead to completely different outputs. For simple use cases, this is manageable. For anything customer-facing or tied to business logic, it can become a problem.

You need guardrails. That includes validation layers, response checks, and clear boundaries on what the model is allowed to do.

Working with unstructured data

Most business data is not clean or standardized. It lives in documents, conversations, tickets, and notes.

LLMs can process unstructured data, but that does not mean they automatically understand it correctly. If your data is messy, outdated, or inconsistent, the output will reflect that.

To get reliable results, you need to organize and filter what you send to the model. That often means adding retrieval augmented generation layers, cleaning your data sources, and deciding what should or should not be included in each request.

Prompt engineering is not optional

Getting useful results from an LLM is not just about calling LLM APIs. How you structure the request matters just as much as the model itself.

Prompt engineering becomes a core part of the system. You need to define instructions, format inputs, and guide the model toward the right type of response.

This takes iteration. What works in testing may not hold up in production, especially when real users start sending unpredictable inputs.

Handling complex tasks is harder than it looks

LLMs are great at generating text, summarizing content, and answering questions. They are less reliable when tasks require strict logic, multiple steps, or exact accuracy.

When you try to use them for complex tasks, things can break down. The model may skip steps, misinterpret context, or produce confident but incorrect answers.

The solution is usually to combine LLMs with traditional logic. Let the model handle language, while your system handles rules, workflows, and validation.

Risk around sensitive data

Sending data to LLM APIs introduces real concerns around privacy and security.

If you are dealing with sensitive data, you need to be very clear about what is being sent, where it is processed, and how it is stored. That includes customer information, internal documents, and anything tied to compliance requirements.

In many cases, you will need to filter or redact data before making a request. You may also need stricter controls around access and logging.

Inconsistent model performance

Even with the right setup, the model’s performance can vary.

Changes in user inputs, updates from the provider, or shifts in your data can all impact results. What works well today may degrade over time if you are not monitoring it.

That is why ongoing evaluation matters. You need to track outputs, test edge cases, and continuously refine how your system interacts with the model.

LLMs are powerful, but they are not deterministic systems. Treating them like one is where most integrations fail.

10-point checklist: should you integrate an LLM into your product?

Before you jump into building, it is worth stepping back and pressure testing the idea. LLM integrations can unlock real value, but only if they fit your product, your data, and your users. Use this checklist to quickly sanity check whether it makes sense for you right now.

1. Do you have a real use case, not just curiosity?

Are you solving a clear problem, like improving support, search, or onboarding? If the idea is vague, the implementation will be too.

2. Will natural language actually improve the experience?

Does your product benefit from users typing or asking questions freely? If structured inputs already work well, you may not need it.

3. Do you have access to useful data?

LLMs are far more valuable when connected to your own data. Think knowledge bases, tickets, CRM data, or product usage history.

4. Is your data in a usable state?

If most of your data is messy or scattered across tools, you will struggle. Unstructured data can work, but it still needs some level of organization.

5. Can you define the desired output clearly?

Do you know what a “good” response looks like? Without a clear desired format, results will feel inconsistent.

6. Are you ready to handle unpredictable user inputs?

Users will ask unexpected questions and phrase things in strange ways. Your system needs guardrails to handle that safely.

7. Do you have the resources to iterate on prompt engineering?

This is not a one-time setup. You will need to refine prompts, test outputs, and improve over time.

8. Are you comfortable working with LLM APIs?

Your team should be able to handle API interactions, manage keys, and handle failures.
If not, expect a learning curve.

9. Have you thought about sensitive data?

Will you be sending customer or internal data through the system? If yes, you need a plan for filtering, compliance, and security.

10. Do you have a way to measure the model’s performance?

You need feedback loops. That could be user ratings, internal reviews, or tracking success rates on specific tasks.

If you are answering “yes” to most of these, you are in a strong position to move forward. If not, it is better to tighten the fundamentals first before adding another layer of complexity.

How to create an LLM integration, step by step

Wondering if you need conversational agents or some other shape or form of LLM integration? Here’s how you can get started, step by step.

1. Define the exact use case and success criteria

Before writing a single line of code, you need to get very clear on what you are actually building. This is where most LLM integrations fail. Teams jump straight into software development without defining the problem, and end up with something impressive but not useful.

Start with a specific use case.

Not “add AI to our product,” but something concrete like improving support response times, helping users find information faster, or assisting agents with replies. The narrower the scope, the easier it is to build something that works.

Then define what success looks like. That could be:

  • reducing response time
  • increasing resolution rates
  • lowering support volume.

Without this, you will have no way to evaluate whether the integration is doing its job.

You also need to consider constraints early. Think about computational resources, expected usage, and how often the model will be called. A feature that looks simple on paper can become expensive or slow if you do not plan for scale.

Finally, align the use case with your existing workflows. Where will this live? Who will use it? What triggers it? If you cannot answer these questions clearly, the rest of the integration will feel disconnected from your product.

Get this step right, and everything that follows becomes much easier.

2. Choose the right model and provider

Once your use case is clear, the next step is picking the right model and provider. This decision has a direct impact on LLM performance, cost, and how reliable your integration will be in real use.

Start by matching the model to the task.

Not every use case needs the most advanced GPT model. Simpler tasks like summarization or classification can run well on lighter models, while more complex workflows need stronger reasoning and better context handling. Picking something too powerful can quickly increase costs, while picking something too limited will hurt output quality.

You also need to think about how this will feel for users.

If you are building AI assistants that interact in real time, response speed matters just as much as accuracy. Users expect quick replies, and even small delays can make the experience feel clunky. In many cases, a faster model with slightly lower capability is the better choice.

Next, consider your LLM usage. How often will the model be called, and under what conditions? Will it handle occasional requests or run on every user action? You also need to think about traffic spikes and whether your provider can handle them without performance issues. These factors will shape both cost and scalability.

Finally, look at the provider as a whole. Some platforms make it easier to manage API access, monitor usage, and scale over time. Others focus more on flexibility or pricing. The goal is not to pick the most advanced option available, but the one that fits your product and how you plan to use it.

3. Decide where the integration will live in your product

This is where things start getting real.

You already know what you want to build. Now you need to figure out where it actually fits. And this is a decision that affects adoption, performance, and whether the feature gets used at all.

Start by looking at your existing product flows.

Where are users getting stuck? Where do they need help, context, or faster answers? That is usually where an LLM integration makes the most sense.

For example, dropping it into a support chat is the obvious move. But sometimes the better play is less visible, like embedding it into a search bar, a dashboard, or even behind the scenes to assist your team instead of your users.

You also need to think about how it gets triggered. Is it always on, reacting to every user input, or does it activate in specific moments? If you overuse it, the product can feel noisy or unpredictable. If you hide it too much, people will not even realize it is there.

Another thing people underestimate is context. Wherever you place the integration, it needs access to the right data at the right moment. A support assistant inside a ticket view should see conversation history. A product assistant inside your app should understand what the user is doing right now.

The goal here is to place it where it naturally improves the experience, without forcing users to change how they already use your product.

4. Map the data sources the model needs to access

At this point, the integration starts to depend less on the model and more on your data.

LLMs are only as useful as the input data you give them. If you send vague or incomplete context, you will get vague answers back. If you send the right information, the model’s outputs become far more accurate and relevant.

Start by identifying what the model actually needs to do its job. For a support assistant, that might include help center articles, past conversations, and customer account details. For an internal tool, it could be documentation, reports, or product data.

Then look at where that data lives.

It is usually spread across multiple systems, your CRM, knowledge base, databases, or even third-party tools. You do not need to connect everything, but you do need to be intentional about what gets included.

Quality matters just as much as access.

If your data is outdated, duplicated, or inconsistent, the model will reflect that. This is where many integrations quietly break down. The model is fine, but the data feeding it is not.

You also need to think about how that data is retrieved. In most cases, you will not send everything at once. Instead, you pull only the most relevant pieces based on the situation, then include them in the request.

The goal here is simple. Make sure the model sees the right context at the right time. That is what turns generic responses into something genuinely useful.

5. Set up API access, authentication, and permissions

Now you are getting into the actual connection between your product and the model.

Large language models are typically accessed through APIs, so the first step is setting up secure access. This usually means generating an API key from your provider and making sure it is stored safely on your backend, never exposed in client-side code.

From there, you define how your system will communicate with the model. Every request needs to include the right input data, instructions, and any additional context you want the model to use. This is what shapes the model’s behavior and enables tailored responses instead of generic ones.

You also need to think about permissions early. Not every part of your system should have the same level of access. For example, an internal tool might be allowed to generate detailed summaries or assist with code generation, while a customer-facing feature should be more controlled and limited.

Data privacy is a big part of this step.

Before sending anything to the model, decide what data is safe to include and what needs to be filtered out. That could mean removing sensitive fields, anonymizing user data, or restricting certain types of requests entirely.

Finally, plan for failure cases. API calls can time out, fail, or return unexpected results. Your system should handle that gracefully, whether that means retrying the request, falling back to a default response, or prompting the user to try again.

This step is less about building features and more about building a reliable foundation. If the connection is not secure and stable, everything built on top of it will be shaky.

6. Design the prompt structure and response rules

This is the part that decides whether your integration feels sharp or sloppy.

A lot of teams assume the model will “figure it out” if they send enough text data and a loosely written instruction. Sometimes that works in a demo. In a real product, it usually does not. If you want reliable answers, you need to be deliberate about how each request is structured.

Start with the basics. What should the model do, what context should it use, and what should the answer look like? Those instructions need to be clear, consistent, and tied to the use case. If the model is helping with support, tell it how to answer, what sources to prioritize, and what it should avoid saying. If it is summarizing previous interactions, define what matters most, like key actions, unresolved issues, or customer sentiment.

You also need response rules.

Should the model answer only from approved sources? Should it say “I don’t know” when the context is weak? Should it keep answers short, or explain them in more detail? These decisions shape the experience more than most people expect.

This is also where error handling starts to matter. If the input is incomplete, contradictory, or missing context, your system should know what happens next. Maybe the model asks a follow-up question. Maybe it falls back to a safer default. Maybe it hands things off to a human.

A well-designed prompt structure will not magically solve everything, but it does give you consistency. And consistency is what turns an LLM feature from a novelty into a real competitive edge.

7. Add retrieval and context handling for smarter responses

Up to this point, you have a working connection and a structured prompt. Now comes the step that actually makes the experience feel useful instead of generic.

If you rely only on the model’s built-in knowledge, responses will sound decent but lack depth. They will not reflect your product, your users, or your data. To fix that, you need to bring in context at the moment the request is made.

This usually means pulling in relevant text data based on the situation. That could be help articles, account details, or previous interactions with the user. Instead of sending everything, you select only what matters and include it in the request.

This is how you move from generic replies to something that feels grounded and accurate. It is also what enables more interactive experiences. The model is reacting to what is happening in real time.

You should also think about flexibility here. Different LLMs handle context in slightly different ways. Some perform better with shorter, focused inputs, while others can manage larger chunks of information. Your setup should allow you to adjust how context is passed in without rewriting everything.

When this is done well, the difference is obvious. Instead of producing surface-level answers, the model can generate human-like text that actually reflects the user’s situation. That is what makes the integration feel like a real feature, not just an add-on.

8. Build the backend logic for requests, responses, and fallbacks

This is where everything starts to come together behind the scenes.

At a basic level, your backend is responsible for deciding when to send prompts, what goes into them, and what happens with the response. But in practice, it does a lot more than that. It becomes the control layer between your product and the model.

Start by defining how requests are triggered. That could be a user action, a system event, or part of a workflow. Once triggered, your backend gathers the right context, builds the prompt, and sends it to the model. The response then needs to be processed before it is returned to the user or used elsewhere in your system.

This is also where you introduce structure. For example, you might route different types of requests to different AI agents, each responsible for a specific task like answering questions, summarizing content, or handling internal queries. This helps keep things organized, especially as your integration grows.

You also need to think about scale. What works for a small feature can break under large scale usage. That means handling retries, managing timeouts, and making sure your system does not fail when the model is slow or unavailable.

Fallbacks are critical here. If the model cannot produce a reliable answer, your system should know what to do next. That could mean returning a default response, asking for clarification, or handing things off to a human.

Finally, keep in mind that large language models rely on general knowledge unless you guide them otherwise. If you need more specialized behavior, you may explore fine-tuning or additional layers of control, but even then, your backend logic is what keeps everything predictable and usable.

9. Create the frontend experience for user inputs and outputs

Now it is time to think about what users actually see and interact with.

You can have a powerful backend, but if the frontend experience is clunky, people will not use it. The goal here is to make interactions feel simple, even when the system behind them is handling complex problems.

Start with how users provide input. This could be a chat interface, a search bar, or a structured form. Keep it intuitive. Users should not need instructions to understand how to interact. In many cases, a simple text field is enough, especially when you want them to ask questions in their own words.

On the output side, clarity matters more than anything. The response should be easy to read and match the context of your product. Sometimes that means plain text. Other times, it means structured responses in a JSON format that your UI can render into tables, lists, or action steps.

You also need to handle feedback loops. Give users a way to react to responses, whether that is thumbs up, corrections, or follow-up questions. This helps you improve the system over time.

From a technical perspective, keep sensitive details out of the frontend. Things like your API key should always stay on the backend, typically stored in an ENV file. The frontend should only communicate with your own services, not directly with the model provider.

If you are integrating with tools like Power Automate or other workflow systems, make sure the experience stays consistent. The user should not feel like they are jumping between disconnected tools.

A clean frontend turns your LLM integration from a technical feature into something people actually rely on.

10. Add guardrails for security, accuracy, and sensitive data handling

This is the step that separates a clever demo from something you can trust in a real product.

LLMs can produce useful answers, but they can also get things wrong, overstate confidence, or respond in ways that do not fit your policies. That is why guardrails matter. You need clear limits around what the model can see, what it can say, and what it is allowed to do.

Start with data controls. Decide what information can be passed into the model and what should never leave your system in raw form. Customer records, payment details, private messages, and internal documents all need careful handling. In some cases, you may need to redact fields before the request is sent. In others, you may block certain data entirely.

Then focus on output control. The model should not be free to answer anything in any way. You can set rules for tone, length, approved sources, and restricted topics. You can also require the system to decline when confidence is low instead of guessing.

Validation matters too. If the model returns a response that triggers an action, like updating a record or sending a message, that output should be checked before anything happens. Let the model handle language, but keep sensitive decisions behind rules and verification.

It is also smart to log responses, flag risky cases, and review failures regularly. Not because the system is broken, but because real users will always find edge cases you did not plan for.

This part is not glamorous, but it is one of the most important steps in the entire integration. Without guardrails, even a good model becomes hard to trust.

11. Test with real scenarios, edge cases, and messy inputs

This is where you find out if your integration actually works.

Testing LLM features is very different from testing traditional software. You are not just checking if something runs without errors. You are evaluating the quality, consistency, and usefulness of LLM outputs across a wide range of situations.

Start with realistic scenarios. Use actual customer support conversations, real user queries, and typical workflows from your product. Synthetic examples are useful early on, but they rarely reflect how people behave in practice.

Then push beyond the obvious cases. What happens when users are vague, frustrated, or unclear? What if they provide incomplete information or mix multiple questions into one? These edge cases are where large models tend to struggle, and where poor experiences show up.

You should also test how the system behaves under different conditions. Try switching prompts, adjusting context, or even comparing responses across different configurations from your LLM provider. Small changes can have a big impact on output quality.

Another important area is failure handling. What happens when the model does not know the answer, or returns something incorrect? Does your system catch it, or does it pass straight through to the user?

Finally, involve real people in testing. Internal teams, especially those in customer support, are great at spotting issues quickly because they know what good answers should look like.

The goal here is not perfection. It is confidence that your system can handle real-world usage without breaking or frustrating users.

12. Measure performance, iterate, and improve over time

Launching the integration is not the finish line. It is the starting point.

LLMs are not static systems.

The quality of the LLM’s response can change based on user behavior, data quality, and even updates from your provider. If you are not actively measuring performance, things can quietly degrade without you noticing.

Start by defining what success looks like in practice. That could be resolution rates in customer support, accuracy of answers, user satisfaction, or how often the system completes specific tasks without human intervention. Pick a few metrics that actually reflect value, not just usage.

Then track how the system performs in real conditions. Look at where it succeeds, but pay even more attention to where it struggles. Are there patterns in failures? Are certain types of questions consistently producing weak answers? That is where your biggest improvements will come from.

User feedback is especially valuable here. If people correct the system, ask follow-up questions, or abandon the interaction, those signals tell you something is off.

From there, you iterate. You adjust prompts, refine how context is passed in, improve data quality, and tweak how your system handles edge cases. Sometimes small changes can lead to much more optimal results.

Over time, this is how your integration becomes reliable. It learns from real usage, adapts to new scenarios, and gets better at helping users perform tasks without friction.

The teams that treat LLM integrations as evolving systems, not one-time features, are the ones that see long-term impact.

Why Quiq is the smarter choice for CX focused LLM integrations

Most LLM integrations look good in a demo. Clean prompts, perfect inputs, ideal conditions. Then real customers show up, and things start to break.

Questions are messy. Context is missing. Conversations jump between topics. And suddenly, your “AI feature” is either giving vague answers or making things up with confidence.

That is exactly where Quiq fits in.

Quiq is not trying to be a general-purpose AI layer for any app. It is built specifically for customer experience, where the stakes are higher, and the margin for error is smaller. Every interaction needs to be accurate, consistent, and grounded in a real business context.

Instead of just passing prompts to a model, Quiq focuses on orchestration. It connects large language models with your data, your workflows, and your support systems in a way that actually holds up in production. That means better handling of context, cleaner handoffs between automation and human agents, and responses that reflect what is actually happening with the customer.

It also gives you more control where it matters. You can shape how conversations are handled, how data is used, and when the system should step back instead of guessing. That is critical in customer support, where a wrong answer is worse than no answer.

If your goal is to build something flashy, you have plenty of options. If your goal is to deliver consistent customer experiences at scale, Quiq is built for that.

And that is the difference that shows up when real users start interacting with your system.Book a demo with Quiq to see how we can improve your customer experience with AI.

Generative AI in Travel: 11 Use Cases for Airlines and Hotels

Key takeaways

  • Generative AI in travel moves beyond scripted chatbots to AI agents that actually resolve issues like processing cancellations, rebooking flights, issuing refunds without human intervention, and other benefits.
  • Travel companies use AI for 11 core applications, including omnichannel customer service, personalized recommendations, real-time itinerary generation, dynamic pricing, and proactive disruption alerts.
  • AI maintains continuous context across all communication channels, allowing travelers to switch between chat, SMS, and phone without repeating their information or losing conversation history.
  • Travel companies measure AI success through containment rates, cost per contact, customer satisfaction scores, and resolution times, rather than simple deflection metrics.

Travelers now expect the same instant, personalized service from airlines and hotels that they get from their favorite apps—and most travel industry brands aren’t equipped to deliver it. The gap between what customers want and what traditional support systems can handle is widening fast.

In this article, I break down 11 specific ways companies in the travel space are using generative AI (or gen AI) today, what the technology still gets wrong, and how to evaluate whether your organization is ready to implement it.

What exactly do I mean by generative AI in travel?

Generative AI in travel refers to AI systems that create personalized itineraries, automate customer service conversations, and even for content generation like hotel descriptions or marketing copy—all tailored to individual travelers in real time. Companies like Expedia and KAYAK already use generative AI to streamline bookings, predict fares, and deliver smoother end-to-end travel experiences.

The key difference from older technology is that traditional chatbots follow scripts. When you ask “What’s your cancellation policy?” they pull a pre-written answer.

Generative AI, on the other hand, understands what you’re actually trying to accomplish. So when a traveler says “I’m flying with my dog to Barcelona next month and I’m not sure what I need,” the AI parses the intent, retrieves pet travel requirements, and walks through the steps conversationally.

For companies in the travel space, this distinction matters a lot because it shifts AI from deflection to resolution. The AI doesn’t just point customers toward an FAQ—it actually solves problems.

Read our 2026 State of AI Agents in Travel & Hospitality. Get guide >

Why travel brands are investing in gen AI right now

Traveler expectations have shifted. People expect the same instant, personalized service from an airline or hotel that they get from their favorite apps. At the same time, support costs keep climbing, agent turnover remains stubbornly high, and customers increasingly prefer messaging over phone calls.

AI that resolves routine inquiries—booking status, check-in times, loyalty point balances—frees human agents to focus on complex situations. When AI maintains context across channels, customers don’t repeat themselves, which directly impacts customer satisfaction scores.

There’s also competitive pressure. When one major airline rolls out an AI concierge that actually works, everyone else feels the urgency to catch up.

Key benefits of generative AI for travel and hospitality companies

For customer experience leaders, the value of generative AI is measurable in operational metrics and customer sentiment.

Faster resolutions at scale

Speed is the currency of customer service. Generative AI reduces Average Handle Times (AHT) for both common and complex requests.

In the airline industry—where operational complexity is constant—Quiq helped Spirit Airlines implement an agentic AI agent. The result was an automated resolution rate of over 40%, with conversation times that are 16% faster. And by automating routine inquiries, the system freed up human agents to focus on more complex issues.

Personalized travel journeys

Personalization has historically been difficult to scale. Amadeus research indicates that 37% of travelers cite personalized recommendations as a key benefit of AI.

Generative AI can ingest a traveler’s history, loyalty status, and current context to tailor every interaction. It doesn’t just suggest “hotels in Paris”. It suggests “boutique hotels in Le Marais near your last stay, available for your dates next week.”

Operational efficiency and savings

The operational impact is stark. By deflecting repetitive inquiries — like “what is my baggage allowance?” or “when is breakfast served?” — brands can significantly lower their cost per contact.

The Accor partnership demonstrates this efficiency in action. Their generative AI agent handled a massive volume of guest inquiries, allowing the brand to scale support without linearly scaling headcount.

Improved customer satisfaction and loyalty

There is a misconception that automation kills satisfaction. The data suggests the opposite: good automation builds loyalty.

In the Accor case study, the deployment of a competent generative AI agent didn’t just deflect tickets. It raised Customer Satisfaction (CSAT) scores from 67% to 89%. When guests get fast, accurate answers — even from a machine — they are happier. 

11 use cases of generative AI in the travel industry

Of course, the below AI use cases are not the end-all, be-all, but these are the most common ones.

1. AI-powered customer service that actually resolves issues

The real breakthrough is that AI can take action now. AI agents that process cancellations, rebook flights, update reservations, and issue refunds without handing off to a human represent a genuine leap forward.

Agentic AI differs from first-generation chatbots in a fundamental way. Rather than following a decision tree, agentic AI reasons through multi-turn conversations, adapts when customers change direction mid-request, and executes workflows end-to-end. We built Quiq to let travel enterprises deploy AI agents that resolve issues autonomously, while maintaining full visibility into every decision.

2. Travel industry AI agents for always-on support

Time zones don’t care about staffing schedules. A traveler in Tokyo booking a European tour at 2 AM local time expects the same quality of support as someone calling during business hours.

AI agents handle the volume that would otherwise require round-the-clock staffing—answering questions about baggage policies, check-in procedures, and booking confirmations. The key is ensuring bots escalate gracefully when they hit their limits, rather than trapping customers in frustrating loops.

3. Omnichannel AI that remembers every conversation

Here’s a scenario that frustrates travelers constantly: they start a conversation on chat, switch to SMS when they leave the house, then call when the issue gets complicated—and have to explain everything from scratch each time.

True omnichannel AI maintains continuous context across every channel. The conversation becomes one unbroken thread, regardless of how the customer chooses to communicate. Maintaining that continuity often makes the difference between a satisfied customer and a lost one.

4. AI-powered tools for personalized travel recommendations

Generative AI tools can analyze past bookings, browsing behavior, and stated user preferences to suggest destinations, hotels, and experiences that actually match what a traveler wants.

Instead of showing everyone the same “Top 10 Beach Destinations” list, AI tailors recommendations to individual tastes and budgets—surfacing hidden gems alongside popular choices.

The personalization extends beyond destinations:

  • Accommodation matching: AI suggests specific room types based on past preferences.
  • Activity curation: Families with young kids get different recommendations than couples celebrating anniversaries.
  • Budget optimization: Recommendations adjust based on spending patterns and stated price ranges.

5. Custom itinerary planning and generation with AI tools in seconds

Planning a multi-day trip used to mean hours of research across dozens of browser tabs, going deep into the furthest reaches of tourism sector blogs for travel inspiration. Generative AI can now create detailed custom itineraries based on traveler inputs—budget, interests, travel dates, pace preferences—in seconds, enabling true conversational trip planning at scale.

Google’s Gemini, for example, generates multi-day trip plans that account for travel times between attractions, opening hours, and logical sequencing. For tour operators, itinerary planning at scale no longer requires the manual effort that previously made customization impractical.

6. Overcome language barriers with real-time language translation

Language differences have always complicated international travel. But now, AI-powered translation works across both text and voice, enabling travelers to communicate in multiple languages with local businesses.

By the same token, support teams can offer real-time assistance to customers in their preferred languages.

Hospitality and online travel agencies increasingly rely on these tools to overcome language differences and serve a truly global audience. The best AI translation tools adapt tone and cultural context, making interactions feel natural.

For example, when Quiq partnered with Accor, they deployed an AI agent capable of fluent engagement in English, French, German, Arabic, Spanish (Euro & Latam), Portuguese (Euro & Brazilian), Dutch, and Italian. This meant understanding cultural nuances and context across languages. The result was a support system that felt native to the guest, regardless of where they came from.

7. Loyalty, rewards, and account management

Loyalty programs are notoriously complex. Generative AI simplifies them.

Instead of a traveler reading a PDF to understand blackout dates, they can simply ask, “Can I use my points for a flight to Tokyo next month?”

The AI reviews the specific tier benefits and provides a clear answer, potentially identifying an upsell opportunity in the process.

8. Proactive alerts for disruptions and flight delays

Rather than waiting for travelers to discover their flight is delayed, AI can detect disruptions and immediately notify affected customers with rebooking options. Proactive outreach turns a frustrating situation into a moment where the brand demonstrates it’s looking out for the customer.

The AI doesn’t just alert—it offers solutions. “Your flight is delayed by 3 hours. I can rebook you on an earlier connection that gets you there at the same time. Want me to make that change?”

9. AI-assisted booking changes and cancellations

Modifying a reservation—changing dates, switching room types, canceling and rebooking—traditionally required either navigating a clunky self-service portal or waiting for a human agent. AI agents now handle booking process changes conversationally, walking customers through options and executing changes in real time.

Real-time assistance proves particularly valuable during high-volume periods when hold times spike and customer patience wears thin.

By the way: The journey doesn’t end at checkout. Generative AI handles the tedious administrative tail of travel — refunds, invoice requests, and lost-and-found reports. By automating these tasks, brands ensure the final touchpoint is efficient, leaving a positive lasting impression that encourages retention.

10. Dynamic pricing and demand forecasting

Dynamic pricing isn’t new to travel, but AI makes it far more sophisticated. By analyzing market trends, competitor rates, historical patterns, and real time data on demand signals, AI optimizes ticket prices for hotels, flights, and tours—opening up new revenue streams for travel companies.

For revenue managers, the shift means moving from periodic price adjustments to continuous optimization—capturing more revenue during high-demand periods while filling inventory during slower times.

11. Sentiment analysis across the traveler journey

AI can monitor customer feedback and conversation tone in real time through sentiment analysis, flagging unhappy customers before small issues become big problems.

When a traveler’s messages shift from neutral to frustrated, the system can automatically escalate to a human agent or trigger a service recovery workflow.

An early warning system like this helps travel companies address issues proactively, rather than discovering problems only when negative reviews appear.

How generative AI works behind the scenes in travel

Understanding the basic flow helps explain both the capabilities and limitations of AI in the tourism industry. The quality of each step depends heavily on the underlying large datasets and how well the AI has been configured to handle specific scenarios.

  • User input: A traveler asks a question via chat, voice, or SMS.
  • Intent recognition: The AI interprets what the traveler actually wants, even if the phrasing is ambiguous.
  • Knowledge retrieval: The system pulls relevant customer data from booking systems, FAQs, policies, and real-time sources.
  • Response generation: AI crafts a personalized reply or takes action directly.
  • Escalation logic: Complex issues route to human agents with full conversation context.

What artificial intelligence in travel still gets wrong

Data privacy and regulatory compliance

You can’t sustain travel innovation without guardrails. Brands handle sensitive information—payment details, passport numbers, travel patterns. Any AI implementation needs to protect this data while complying with regulations like GDPR and PCI requirements.

Keeping your brand voice consistent

Generic AI responses can feel off-brand, especially for travel companies that have invested heavily in their voice and personality. The best AI platforms allow brands to configure tone, terminology, and communication style, so the AI sounds like an extension of the team and not a generic bot.

Knowing when to hand off to a human

AI that doesn’t recognize its limits creates terrible experiences. When a customer deals with a genuinely complex situation—a medical emergency affecting travel plans, a multi-leg booking gone wrong—the AI needs to escalate gracefully and quickly.

Preventing AI hallucinations in customer conversations

Hallucinations occur when AI confidently states incorrect information—inventing flight times, making up hotel amenities, or providing inaccurate policy details. For travel companies, this is far more than embarrassing; it can lead to missed flights and ruined trips. Guardrails and governed AI architectures help prevent these errors.

Why transparency and control will define AI winners in travel

Transparency in AI means travel companies can see exactly how every decision was made, audit it, and override it when needed. When something goes wrong—and eventually something will—leaders need to understand exactly what happened and why.

Why it matters
Decision visibilitySee exactly how AI reached a conclusion
Configurable guardrailsControl what AI can and cannot do
Full audit trailsMeet compliance and governance requirements
Brand voice enforcementEnsure AI sounds like your brand

The platforms that win enterprise trust are the ones that show their work.

How to implement generative AI in your travel business

1. Identify your highest-volume customer pain points

Start with the inquiries that overwhelm your team—booking changes, status checks, common FAQs. Quick wins like these let AI demonstrate value without tackling your most complex scenarios first.

2. Run a controlled pilot before full deployment

Test AI in a sandbox with real scenarios. Measure resolution rates, CSAT, and escalation patterns before scaling.

3. Connect AI to your existing systems

AI that can only answer questions but not take action has limited value. Integration with booking engines, CRMs, and knowledge bases enables AI to actually resolve issues rather than just providing information—and helps improve customer service outcomes across the board.

4. Build guardrails and governance from the start

Define what AI can do autonomously versus what requires human approval. Set brand voice guidelines early. Retrofitting these decisions later is far harder than building them in from the beginning.

5. Track metrics that tie to business outcomes

Measure containment rate, cost per contact, CSAT, and resolution time—not just deflection. The goal isn’t to make customers go away; it’s to actually solve their problems.

AI innovation and the future outlook for travel

Innovation with AI in the travel ecosystem is accelerating on multiple fronts. Here’s where we see it heading:

  • Voice AI is getting good enoughthat travelers won’t notice they’re not talking to a person. That changes the support model entirely.
  • Multimodal interactions—like sending an SMS during a voice call without hanging up—are becoming practical, giving travelers more flexibility in how they engage.
  • Virtual assistants are evolving from reactive responders to proactive partners that anticipate traveler needs before they’re expressed—surfacing trip inspiration, events, and the best restaurants before anyone asks.
  • Online travel agents and travel agencies are increasingly relying on generative artificial intelligence to automate tasks, generate visual content, and drive direct bookings at scale.
  • Operational gains are extending across hospitality brands and tour operator businesses alike, with artificial intelligence helping identify local events, recommend the best restaurants, and guide travelers via public transit options with more confidence than ever before.

For CX leaders ready to explore what agentic AI can do for their travel brand, book a demo with Quiq to see how continuous context and transparent AI decisions work in practice.

FAQs about generative AI in travel

Can I use ChatGPT as a travel agent?

ChatGPT can help brainstorm travel destinations and draft rough itineraries, but it can’t access real-time booking systems, process reservations, or handle customer service on behalf of a travel brand. It’s a useful research tool to collect info like tour descriptions, not a replacement for integrated travel AI.

What is the difference between a travel chatbot and an AI agent?

A chatbot follows scripted responses and decision trees. An agent uses generative AI to understand intent, reason through complex requests, and take autonomous action—like actually rebooking a flight rather than just explaining how to do it.

How do travel companies measure return on investment for AI?

They typically track containment rate (issues resolved without a human), cost per contact, CSAT scores, and agent productivity improvements.

Will AI replace human travel agents entirely?

AI handles routine inquiries and frees human agents for complex, high-value interactions. Travelers with genuinely complicated needs—honeymoon planning, multi-generational family trips, complex itineraries—still benefit enormously from human expertise. The transformative power of gen AI lies not in replacing people, but in enabling them to focus on the personalized experiences and travel planning that matter most—from finding the best deals on desired activities to offering virtual tours of properties and insights read from customer interactions that other businesses simply can’t match.

The 12 Most Asked Questions About AI, Answered Plainly

Key Takeaways

  • Today’s AI is narrow, not general: deployed AI systems excel at specific tasks like fraud detection or customer queries but cannot perform broad human-like reasoning across domains.
  • Generative AI creates content while agentic AI takes autonomous actions: generative models produce text and images, whereas agentic systems execute tasks, call APIs, and make decisions independently.
  • AI model quality depends entirely on training data quality: biased, sparse, or unrepresentative data produces biased, brittle, or underperforming AI outputs.
  • Current evidence shows AI augments jobs rather than eliminates them: MIT research found generative AI in contact centers accelerated junior agent learning and reduced turnover instead of replacing workers.
  • Successful AI deployment requires defined success criteria, configurable guardrails, and human oversight loops: projects fail most often from unclear KPIs, unconstrained AI behavior, or lack of feedback mechanisms.

People have a lot of questions about AI right now — and most of the answers they find online are either too shallow or too technical to be useful. I’ve spent years working at the intersection of AI and customer experience, and the questions about AI I hear most often fall into a predictable set: What is it, really? What can it do? What should we be worried about? This article answers all twelve of the most common ones, directly and without hype.

1. Questions about AI: Where they come from and why they matter?

The term “artificial intelligence” was first used at the Dartmouth Conference in 1956, organized by John McCarthy, Marvin Minsky, and Claude Shannon. Their ambition was to build machines that could use language, form concepts, and solve problems reserved for human creativity. They estimated a summer’s work would get them most of the way there.

They were off by about seven decades — and counting.

The gap between that optimism and reality isn’t a failure. It’s a testament to how genuinely hard it is to replicate human intellect. What has emerged instead is something more useful than the original vision: a set of specific, powerful capabilities that are changing how businesses operate and how people work. Understanding those capabilities — and their limits — is what separates organizations that get real value from AI from those that chase demos.

2. Artificial intelligence: What actually is it?

Artificial intelligence is the ability of machines to perform tasks that normally require human intelligence — learning, problem-solving, pattern recognition, and decision making. AI systems learn from data to identify patterns and make predictions, rather than following rigid, hand-coded rules.

The most useful framework I’ve found comes from Stuart Russell and Peter Norvig’s textbook Artificial Intelligence: A Modern Approach. They describe four approaches:

  • Think like humans: Replicate human cognitive processes, including the messy, intuitive parts.
  • Act like humans: Behave in ways indistinguishable from a human — the standard behind the Turing test.
  • Think rationally: Reason according to formal logic and probability.
  • Act rationally: Choose actions that maximize outcomes, even without full deliberation.

From a practical standpoint, AI today spans several distinct branches:

  • Agentic AI: Systems that take autonomous, goal-directed actions, rather than simply responding to prompts.
  • Machine learning: Algorithms that improve performance over time by learning from existing data.
  • Natural language processing (NLP): Enables human-computer interaction through text and speech.
  • Computer vision: Powers machines to interpret and analyze visual data — including self driving cars and medical imaging.
  • Robotics: Autonomous systems that perform tasks in the physical world.
  • Expert systems: Encode domain-specific knowledge to support decision making.

Each branch unlocks different AI applications. The right one depends entirely on what problem you’re trying to solve.

3. AI systems: What are narrow vs. general?

Most AI deployed today is narrow AI — also called weak AI — meaning it performs one specific task well. A spam filter is narrow. So is a fraud detection algorithm. These systems are highly capable within their domain and perform poorly outside it.

The theoretical counterpart is general AI, sometimes called strong AI or AGI. A general AI system could perform any intellectual task a human can. We don’t have this yet. What we have is an expanding set of narrow capabilities that, when combined, can handle increasingly complex workflows.

Understanding the difference matters because it shapes expectations. When a contact center deploys an AI agent to handle customer queries, that agent is narrow AI — extremely good at a defined set of tasks, not a replacement for human judgment across the board.

4. AI tools: What can they actually do today?

The most common question I get from CX leaders isn’t philosophical — it’s practical: what can these AI tools actually do for my business?

Here’s what’s working right now, with evidence behind it:

  • Contact center automation: Large language models can handle routine, repetitive tasks like answering FAQs, summarizing conversations, and drafting responses — freeing agents to focus on complex issues.
  • Drug discovery: AI is identifying molecular candidates at a pace no human research team could match.
  • Fraud detection: Machine learning models use data points to flag anomalous transactions in real time, with far fewer false positives than rule-based systems.
  • Language translation: Neural machine translation has made real-time, high-quality translation available at scale.
  • Predictive maintenance: Automated systems analyze equipment sensor data to predict failures before they happen, reducing downtime in manufacturing, essential for things like autonomous vehicles.
  • Virtual assistants: Consumer-facing AI handles scheduling, information retrieval, and task execution across millions of daily interactions.
  • Personalized education: AI-powered learning platforms track each student’s performance in real time, adjusting difficulty and identifying gaps without a teacher having to manually monitor every learner.

Generative AI specifically — the category that includes large language models and generative adversarial networks — has expanded what’s possible. These generative AI models don’t just analyze real data; they produce new content. Text, code, images, audio. That’s a meaningful shift in what AI can contribute to knowledge work.

5. AI models: How do they learn and why does data quality matter?

Every AI model is only as good as the data it was trained on. This is not a caveat — it’s a fundamental constraint of how these systems work.

The way it learns works roughly like this: a model is exposed to massive datasets, adjusts its internal parameters based on feedback, and gradually improves its ability to make accurate predictions or generate useful outputs. The three main approaches are:

  • Supervised learning: The model learns from labeled examples — inputs paired with correct outputs.
  • Unsupervised learning: The model finds patterns in unlabeled data without explicit guidance.
  • Reinforcement learning: The model learns by receiving rewards or penalties based on the outcomes of its actions.

Deep learning models — the kind that power most modern AI — use neural networks with many layers to extract increasingly abstract features from data. Its underlying architecture is what enables capabilities like natural language understanding and image recognition.

The implication for businesses is direct: poor data produces poor AI. Biased data produces biased outputs. Sparse data produces brittle models. AI adoption that skips the data preparation step tends to produce AI that underperforms or fails in production, instead of streamline operations.

More data, structured correctly, generally means better results — but only up to a point. The composition and representativeness of the data matters as much as the volume.

6. AI technologies: What’s the difference between generative and agentic AI?

I want to be precise here, because these two terms get conflated constantly.

Generative AI creates new content — text, images, code, audio — by learning patterns from training data. ChatGPT is generative AI. Midjourney is generative AI. These systems are extraordinarily useful for content creation, summarization, and drafting.

Agentic AI goes further. It takes autonomous, goal-directed actions in the world. It doesn’t just generate a response — it executes tasks, calls APIs, makes decisions, and adapts based on outcomes. An agentic AI system handling a customer complaint doesn’t just draft a reply; it looks up the order, checks the return policy, initiates the refund, and sends the confirmation.

The distinction matters for deployment. Generative AI is a powerful tool. Agentic AI is a capable collaborator. The AI technologies underlying both — deep learning, natural language processing (NLP), reinforcement learning, and more — are often the same. What differs is the architecture and the degree of autonomy granted to the system.

For a deeper dive into how agentic AI works in practice, our overview of agentic AI covers the mechanics in detail.

7. AI ethics: What to know about bias, accountability, and the black box problem?

AI ethics is not a soft topic. It has hard, measurable consequences.

When AI systems are trained on biased or unrepresentative data, they replicate and amplify those biases at scale. In hiring, lending, law enforcement, and healthcare, that means real harm to real people. In contact centers, it can mean systematically worse service for certain customer segments — a problem that’s easy to miss and hard to fix after deployment.

The “black box” problem compounds ethical considerations. Many deep learning models make decisions through processes that are difficult to interpret, even for the engineers who built them. This lack of transparency creates accountability gaps: if a model denies a loan or misclassifies a medical image, who is responsible?

The answer today is: the organization that deployed it. AI is a tool, not a legal entity. That means companies bear full responsibility for what their AI does. Responsible deployment requires:

  • Diverse, representative training data that reflects the populations the system will serve.
  • Regular bias audits that test model outputs across demographic groups.
  • Human review in high-stakes decisions — AI assists, humans decide.
  • Audit trails that document how outputs were produced.
  • Explainability tools like SHAP and LIME that help teams understand model behavior.
  • Adherence to frameworks like NIST’s AI Risk Management Framework or ISO/IEC 42001.

Bias prevention requires ongoing vigilance as models are updated, data drifts, and deployment contexts change.

8. Data security: What are the risks no one talks about enough?

AI systems require access to large volumes of data to function. That creates data security exposure that many organizations underestimate at the start of an AI project.

The primary concerns are:

  • Training data protection: The data used to train models often contains sensitive customer, employee, or business information. If that data is mishandled or exposed, the consequences extend far beyond the AI system itself.
  • Inference-time privacy: When users interact with AI systems, those interactions may contain personal information. How that data is stored, used, and protected matters.
  • Adversarial attacks: Bad actors can craft inputs designed to manipulate AI outputs — a real concern for systems that handle financial transactions or customer authentication.
  • Regulatory compliance: GDPR, CCPA, HIPAA, and other regulations impose specific obligations on how AI systems handle personal data.

At Quiq, we treat data security as a foundational requirement, not an afterthought. Our platform is SOC 2 Type II certified, HIPAA-compliant, and GDPR-ready. All customer data is encrypted in transit and at rest. Your data in Quiq belongs to you — we never use it for any purpose other than serving your business.

9. AI impact: What happens to jobs?

The concern that AI will eliminate human labor is not new. It was raised when mechanized looms appeared, when computers arrived, and when the internet changed how work was organized. Each time, the technology shifted the composition of work, rather than eliminating it.

The evidence so far on large language models is consistent with that pattern. MIT economists Erik Brynjolfsson, Danielle Li, and Lindsey R. Raymond studied generative AI use in a large contact center and found it accelerated the learning process for junior agents — helping them reach senior-level performance faster.

The result was lower stress, reduced turnover, and higher output. Not job displacement.

That doesn’t mean job displacement is impossible. It means the current evidence points toward AI changing what people do, not whether they work. Simple tasks get automated. Agents focus on judgment, empathy, and complex problem solving, enhancing productivity. Manufacturing jobs that involve purely repetitive physical tasks face the most direct pressure. Knowledge work is more likely to be augmented than replaced.

Common sense says that broader adoption of AI will require workers to develop new skills and organizations to redesign workflows. That’s real disruption. But it’s different from the apocalyptic scenario that dominates headlines.

10. AI solutions: What makes deployment succeed or fail?

I’ve seen AI projects succeed and fail, and the pattern is consistent. The ones that fail usually share one of three problems:

  1. Unclear success criteria. Teams deploy AI without agreeing on what “working” looks like. Without defined KPIs, there’s no way to know whether the system is performing or not.
  2. Weak guardrails. AI systems that can say anything, do anything, or access anything tend to go wrong in ways that are hard to predict. Enterprise-grade AI solutions need configurable guardrails that constrain AI behavior to what the business actually wants.
  3. No human oversight loop. AI that operates without any human review — especially early in deployment — accumulates errors without correction. The process requires feedback.

The deployments that work share a different set of characteristics: a specific, high-value use case, clean and well-structured data, rigorously tested prompt engineering, configurable guardrails, and a clear escalation path to humans when the AI reaches its limits.

At Quiq, our AI Studio is built around this model. You bring your content as-is, guide the agent with process guides, set guardrails, run simulations, and get step-by-step visibility into every decision. That’s how you maintain control while deploying AI at enterprise scale.

11. AI impact on society: What are the risks worth taking seriously?

I want to address impact at a broader level, because some of the risks are real and deserve honest treatment.

Near-term social risks are already visible. Generative AI makes it dramatically cheaper to produce disinformation at scale, including deepfakes that are increasingly difficult to detect. Political and commercial actors are already using these capabilities. This is not speculative — it’s happening.

Longer-term risks involve the trajectory of AI capabilities themselves. AI research has produced systems that improve rapidly and in ways that are difficult to predict. The leap from GPT-2 to GPT-3 was large. The leap from GPT-3 to GPT-4 was larger. The architecture of these systems — neural networks trained on massive datasets — produces capabilities that emerge from the training process, rather than being explicitly programmed.

The concern that a superintelligent AI system could pursue goals misaligned with human values is not science fiction. It’s a recognized research problem in computer science. The “specification gaming” failure mode — where a system maximizes a proxy objective in ways its designers didn’t intend — is well documented in reinforcement learning.

A famous example: DeepMind’s boat-racing agent discovered it could maximize its reward by spinning in circles to collect bonus points, rather than actually racing.

biggest questions about AI

The same dynamic at the scale of a truly capable general AI system is what concerns researchers working on AI alignment. Whether that risk is near-term or distant is genuinely uncertain. What’s not uncertain is that it’s worth taking seriously now, while the field is still developing the tools to address it.

Does this mean current AI systems pose existential risks? No. Today’s systems — including the most capable large language models — are narrow AI. They don’t have goals in the sense that creates alignment risk. But the pace of progress in AI research makes it worth building governance frameworks now rather than later.

12. What does the future of AI look like?

Honestly, I don’t think anyone can answer this with confidence. The trajectory of AI capabilities has consistently surprised even the researchers closest to the work. What I can say with confidence:

  • AI will continue to get better at specific tasks, particularly those involving language, pattern recognition, and decision making under uncertainty.
  • Adoption will accelerate as deployment costs fall and the tooling matures.
  • The organizations that build governance and oversight into their AI programs now will be better positioned than those that treat it as an afterthought.
  • Key questions remain genuinely open — around alignment with human values, accountability, and the long-term direction of general AI.

The near-term picture for contact centers is clearer. AI is already helping human agents resolve queries faster, handle more volume, and improve customer satisfaction. Quiq customers see 67% reductions in cost per interaction, 89% CSAT scores matching human agents, and resolution rates that continue to improve as more integrations come online.

Those are the results that matter right now. The deeper questions about AI’s long-term trajectory deserve attention, too — but they shouldn’t distract from the practical work of deploying AI responsibly and effectively today.

The bottom line

The questions about AI that matter most are practical. What can it do, what are the real risks, and how do you deploy it responsibly? The answers are clearer than the noise around AI suggests. Current AI systems are powerful, specific, and genuinely useful. They’re also limited, data-dependent, and require real governance to deploy well.

If you’re evaluating AI for your contact center or customer experience operation, the gap between a well-deployed system and a poorly deployed one is significant. The right platform gives you transparency into every AI decision, guardrails you control, and the ability to maintain your brand voice at scale.

Book a demo to see how Quiq approaches AI deployment for enterprise CX — and what it looks like when it’s working.

Frequently Asked Questions (FAQs)

What is artificial intelligence in simple terms?

Artificial intelligence is the ability of machines to perform tasks that normally require human intelligence — including learning, reasoning, and problem solving. AI systems learn from data to identify patterns, then use those patterns to make predictions or take actions, rather than following hand-coded rules.

What are the main types of AI?

The main types of AI are narrow (designed for specific tasks), general (theoretical, not yet achieved), machine learning, natural language processing, computer vision, and agentic. Virtually all AI deployed in production today is narrow — highly capable within a defined domain and unable to generalize beyond it.

How does AI actually learn?

AI models learn by processing large volumes of data and adjusting their internal parameters to improve prediction accuracy over time. The three primary learning approaches are supervised learning (labeled examples), unsupervised learning (pattern discovery without labels), and reinforcement learning (behavior shaped by rewards and penalties). Deep learning models apply layered neural networks to extract increasingly complex patterns from that data.

Will AI take my job?

Current evidence indicates AI changes the nature of work, rather than eliminating jobs. An MIT study of generative AI in a large contact center found it accelerated junior agent performance and reduced turnover — it did not replace workers. Routine tasks are the most likely to be automated; roles requiring judgment, empathy, and complex problem solving are more likely to be augmented.

Is AI dangerous?

AI poses real, documented near-term risks — including large-scale disinformation, deepfakes, and algorithmic bias — that require active governance and human oversight to manage. Long-term risks from advanced AI systems, including misalignment with human values, are taken seriously by researchers, but remain speculative and do not apply to today’s narrow systems. Responsible deployment, bias auditing, and ongoing human oversight are the appropriate response to both categories of risk.

How do I address AI bias in my organization?

Addressing bias requires using diverse, representative training data, conducting regular bias audits across demographic groups, applying explainability tools such as SHAP and LIME, and maintaining human review in high-stakes decision loops. Bias prevention is an ongoing operational discipline — not a one-time setup task — because model updates, data drift, and changing deployment contexts can reintroduce bias over time.

What should enterprises prioritize in AI adoption?

Enterprises should begin AI adoption with a specific, high-value use case and define measurable success criteria before deployment. Clean, well-structured data, configurable guardrails that constrain AI behavior, and a clear escalation path to human agents are the operational foundations that separate successful deployments from failed ones.

13 Most Common Customer Service Challenges in 2026

Customer service has existed for thousands of years in some shape or form, and it has never been easy. With the advancement of customer support tools, you would think that customer service teams would have an easier time doing their jobs, or have them entirely automated. But at the same time, customer expectations have gone through the roof.

Stretched resources, multiple channels, countless customer interactions, large volumes of customer data to collect… These are just the tip of the iceberg for your customer service agents.

Today, we look at the most prevalent customer service challenges: what they are, why they happen, and how to solve them. And even better, we can show you how artificial intelligence can help in each situation.

ChallengeThe best way to solve it
Setting and managing customer expectationsClearly define and communicate response times across channels, reinforce them at the moment of contact, and update dynamically based on real-time conditions
Channel fragmentation and response expectationsAlign channel purpose and response times, unify conversations across channels, and eliminate duplicate customer inquiries with shared context
Lack of customer context and data visibilityCentralize customer data and conversation history so agents can see the full picture instantly and respond without asking customers to repeat themselves
Slow or ineffective issue resolutionFocus on first contact resolution, reduce handoffs, and give agents the tools and authority to fully solve issues in one interaction
Inconsistent customer experiencesStandardize processes, knowledge, and tone across teams while maintaining flexibility, and ensure context carries across the full customer journey
Handling angry customers and high-pressure situationsTrain agents to acknowledge, take ownership, and provide clear next steps, supported by real-time context and guidance during high stress interactions
Managing service outages and crisis communicationCommunicate early, clearly, and consistently across channels, set realistic timelines, and centralize updates to reduce confusion
Hiring, training, and retaining support teamsShorten ramp time with clear playbooks, real-time guidance, and access to past interactions so agents can perform effectively from day one
Poor use of automation and AIAutomate only what can be fully resolved, ensure smooth handoffs to humans, and use AI to complete tasks rather than generate generic replies
Ignoring or underutilizing customer feedbackTurn feedback into action by identifying patterns, prioritizing recurring issues, and closing the loop with customers
Fragmented internal systems and workflowsReduce tool switching by surfacing key data in one place, standardize workflows, and make knowledge easily accessible during interactions
Scaling support without losing qualityAutomate repetitive tasks, support agents with real-time context and guidance, and maintain consistency as volume grows
Misaligned KPIs and performance metricsTrack resolution quality and customer outcomes instead of just speed and volume, and align metrics with actual customer experience improvements

1. Setting and managing customer expectations

Customer service issues rarely come from slow support alone. They come from mismatched expectations.

If a customer expects a reply in five minutes and you respond in two hours, it feels like failure, even if your SLA is reasonable. The issue is the gap between what customers expect and what actually happens.

Most teams make this worse by being vague. They add channels like chat and email, but never explain how they work. A common example:

  • A SaaS company adds live chat to “improve CX”
  • Customers expect real-time replies
  • Actual response time is 20 minutes

Result: CSAT drops. Not because support got worse, but because expectations were never set.

Fixing this is simple and high-impact. You need to be clear, visible, and consistent at every touchpoint:

  • Show expected response times before submission
  • Reinforce them immediately after contact
  • Update them if delays increase

Instead of “we’ll get back to you soon,” say:

  • “Replies within 1 business day”
  • “Typical chat response time is 10 to 15 minutes.”
  • “You’re #3 in the queue, estimated reply in 12 minutes.”

This removes uncertainty, which is often more frustrating than waiting.

AI can improve this when used correctly for real-time expectation management:

  • Predict wait times based on queue volume
  • Route users to faster channels
  • Suggest self-service when it actually matches intent
Quiq helps you solve one of the biggest customer service challenges: self-service

For example, if someone asks “where is my order” during peak hours, show an instant tracking link first, then offer agent support as a fallback.

Customer satisfaction improves when promises match reality. Clear expectations prevent frustration before it starts and customer pain points never become reasons for leaving you entirely.

2. Channel fragmentation and response expectations

Channel fragmentation is one of the fastest ways to break an otherwise solid customer experience.

Most companies offer multiple ways to get in touch, email, chat, social, maybe even SMS. But they don’t connect them properly. The result is a disjointed experience where customers repeat themselves, switch channels, and lose context.

From the customer’s perspective, it looks like this:

  • They send an email, no reply yet
  • They open chat to follow up
  • The agent has no idea about the original message

Now it feels like the company is unorganized, even if the customer service team is doing everything right behind the scenes.

The second issue is inconsistent response expectations across channels. Chat implies speed. Email implies delay. Social sits somewhere in between. When these expectations aren’t clear, frustration builds quickly.

A common scenario:

  • Chat response takes 25 minutes
  • Email response takes 6 hours
  • Social message gets answered instantly

Customers start channel hopping, trying to find the fastest way to get help. This creates duplicate customer inquiries, increases workload, and slows everything down.

Fixing this starts with alignment, not adding more channels.

  • Define what each channel is for
  • Set clear response expectations per channel and communicate proactively
  • Make those expectations visible before users reach out

Then focus on shared context. Every interaction should carry over, regardless of channel. When a customer switches from email to chat, the agent should immediately see the full history, which enhances efficiency and makes for more satisfied customers.

AI can help here by:

  • Unifying conversations into a single thread
  • Routing inquiries based on urgency and intent
  • Detecting duplicate messages across channels

The goal is to make every interaction feel connected and improve service quality while saving time. That’s what enables outstanding customer service, even at scale.

3. Lack of customer context and data visibility

One of the biggest hidden drivers of poor customer experience is a lack of context.

Customers don’t care which system they’re in. They expect your customer service team to know who they are, what they’ve done, and what they’ve already asked. When that doesn’t happen, frustration builds fast.

You’ve seen this before:

  • “Can you provide your order number again?”
  • “I’ll need you to explain the issue from the beginning.”
  • Getting transferred and starting over

Every time this happens, it signals disorganization, even if your team is working hard behind the scenes.

The root problem is fragmented data. Customer history lives across tools, email, CRM, chat, and billing, and none of it is visible in one place during live interactions. As a result, agents handle customer inquiries without the full picture.

This directly impacts resolution speed and quality:

  • Longer back and forth
  • More escalations
  • Lower first contact resolution

Fixing this means making context available in real time, not buried in systems.

  • Surface past conversations automatically
  • Show recent actions like purchases, tickets, or account changes
  • Give agents a single view of the customer before they respond

AI becomes powerful here when it acts as a context layer, not just a response generator.

With platforms like Quiq, conversations across channels are unified into one thread, so agents and AI always have a full history. AI can summarize previous interactions, detect intent based on past behavior, and suggest next steps without forcing the customer to repeat anything.

For example, if a customer reaches out about a delayed order after already contacting support yesterday, the system can:

  • Recognize the ongoing issue
  • Surface the previous conversation
  • Suggest a relevant response or action immediately

Customers feel understood. Agents move faster with instant access to the right data.

That’s what happens when context is treated as a core part of customer experience, not an afterthought.

4. Slow or ineffective issue resolution

Slow responses are frustrating, but slow or ineffective resolution is what actually damages customer experience.

Replying quickly doesn’t matter if the issue isn’t solved. Many teams optimize for speed, first response time, and average handle time, but ignore whether the problem is resolved in one go. That’s where customer service quality breaks down.

You’ll see this in everyday scenarios:

  • An agent replies fast, but asks for basic information already provided, resulting in negative feedback
  • The customer query gets passed between teams with no clear ownership
  • The customer receives multiple partial answers instead of one complete solution

From the customer’s perspective, this feels like wasted effort. It also raises customer expectations for faster and better follow-ups, which the team struggles to meet.

The core problem is a lack of resolution ownership and clarity. No one is responsible for closing the loop end-to-end.

Improving this starts with a shift in focus:

  • Optimize for first contact resolution, not just speed
  • Give agents access to the full context and decision-making authority
  • Reduce internal handoffs wherever possible

For example, instead of routing billing issues to a separate team, equip frontline agents to handle common billing cases directly. That alone can cut resolution time significantly.

AI can support this when used to complete tasks, not just generate replies.

With tools like Quiq’s agentic AI, common requests can be handled end to end, checking order status, updating account details, or resolving simple issues without back and forth. More importantly, when a human agent steps in, they get full context and suggested next actions, which reduces delays.

Fast replies create a good first impression. Complete solutions create exceptional customer service.

5. Inconsistent customer experiences

Inconsistent experiences are one of the fastest ways to lose trust.

A customer might have a great interaction one day and a frustrating one the next, even though nothing about their issue has changed. From their perspective, your company feels unpredictable. That breaks what should be a good customer experience across the entire customer journey.

This usually happens when support is fragmented:

  • Different agents give different answers to the same question
  • Policies are applied inconsistently as different agents serve customers
  • Tone and communication style vary widely
  • Context gets lost across multiple communication channels

For example, a customer might get a refund approved over web chat, then denied over email the next day. Or they explain an issue on social, switch to chat, and have to start from scratch. These inconsistencies make the experience feel unreliable, even if each individual interaction wasn’t terrible.

The root problem is a lack of alignment.

To fix it, you need to standardize how support actually works:

  • Clear guidelines for common scenarios
  • Shared knowledge that all agents use
  • Consistent tone and escalation rules
  • One source of truth for customer data and ongoing training for agents

At the same time, consistency doesn’t mean rigid scripts. Agents still need flexibility to adapt, but within a clear framework.

This is where tools like Quiq help without getting in the way.

Conversations across channels are unified, so agents see the same context no matter where the customer reaches out. Suggested replies and workflows help keep answers aligned, while still allowing agents to adjust based on the situation.

For example, if a customer moves from chat to SMS, the full history carries over. The next agent picks up exactly where things left off, not from zero.

6. Handling angry customers and high-pressure situations

Handling angry customers is part of the job. Handling them well, especially under pressure, is what separates average support from teams that customers actually trust.

Most situations escalate because the customer feels ignored, misunderstood, or stuck. By the time they reach your customer service team, they’re already frustrated. If the response is slow, generic, or defensive, things spiral quickly.

You’ll see it in cases like:

  • A delayed order with no clear update
  • A billing issue that wasn’t resolved the first time
  • A service outage with vague communication

The instinct is often to de-escalate with apologies alone, but that rarely works. What customers actually want is progress.

A better approach is simple and repeatable:

  • Acknowledge the issue clearly, not with generic phrases
  • Show you understand the impact, not just the problem
  • Take ownership of the outcome, even if other teams are involved
  • Give a concrete next step or timeline

For example, instead of saying “we’re looking into it,” say “I can see your order was delayed due to a warehouse issue, I’m escalating this now and will update you within 30 minutes.”

That shift changes the tone of the interaction.

Preparation matters just as much as response. High-pressure situations like outages or spikes in customer inquiries expose weak processes fast. If agents don’t have clear guidance, answers become inconsistent, and customers get mixed messages.

This is where having shared context and suggested responses helps. Tools like Quiq can surface relevant information and recommended next steps in real time, so agents don’t have to improvise under pressure. It keeps responses consistent and focused on resolution so you can provide seamless support at all times.

You won’t eliminate angry customers. But you can control how quickly you move them toward a solution.

7. Managing service outages and crisis communication

Service outages are one of the most pressing customer service challenges because they expose everything at once: your systems, your communication, and your customer service practices.

When something breaks, customers don’t just care about the issue. They care about how you handle it.

You’ve seen both sides:

  • Bad customer service: vague updates, no timeline, customers chasing for answers
  • Good customer service: clear communication, regular updates, realistic expectations

The difference is in how you communicate during the outage.

The biggest mistake teams make is going silent or overpromising. Saying “we’re working on it” without details creates uncertainty. Promising a fix in two hours and missing it makes things worse.

A better approach is structured and proactive:

  • Acknowledge the issue early, even if you don’t have all the answers
  • Explain what’s happening in plain language, not technical jargon
  • Set realistic timelines, and update them if things change
  • Centralize updates so customers aren’t searching across channels

For example, instead of waiting for tickets to come in, publish a status update immediately and direct customers there. Then reinforce it across chat, email, and social with consistent messaging.

AI can support this by helping teams respond faster and stay aligned. With the right tools like Quiq, you can push consistent updates across channels, surface the latest status to agents automatically, and guide responses so every customer hears the same message.

During high-volume spikes, this reduces confusion and prevents agents from giving conflicting answers.

Handled poorly, outages destroy trust fast. Handled well, they can actually strengthen customer loyalty.

Customers don’t expect perfection. They expect clarity, honesty, and control over what happens next.

8. Hiring, training, and retaining support teams

Hiring and retaining strong support teams is one of the hardest problems to get right, and one of the easiest to underestimate.

Most teams focus on hiring quickly to keep up with growing customer inquiries, but that often leads to inconsistent quality and high turnover. New agents are thrown into live conversations without enough context, guidance, or confidence. The result is slower resolution, uneven answers, and a noticeable drop in customer service quality.

You’ll typically see this pattern:

  • New hires rely on scripts and escalate too often
  • Experienced agents become bottlenecks
  • Burnout increases as volume grows
  • Turnover resets the whole cycle

The core issue is about how fast you can make someone effective.

Strong teams invest in practical onboarding and continuous support:

  • Clear playbooks for common scenarios
  • Easy access to past conversations and decisions
  • Defined escalation paths and ownership rules
  • Regular feedback based on real interactions, not just metrics

For example, instead of shadowing for weeks, a new agent can handle simpler cases on day one if they have the right context and guidance in front of them.

This is where AI can actually reduce pressure on the team. With tools like Quiq, agents don’t start from scratch. They get conversation history, suggested replies, and next steps in real time, which helps them respond accurately without second-guessing. You can provide ongoing training without stretching yourself too thin.

Some organizations use an Employer of Record (EOR) to hire internationally without needing to establish a legal entity in each country, which simplifies compliance while allowing teams to scale thoughtfully.

It also helps experienced agents by reducing repetitive work and letting them focus on more complex cases.

9. Poor use of automation and AI

Automation and AI can improve support, or make it noticeably worse. Most teams fall into the second category because they use it to deflect, not resolve.

You’ve seen this play out:

  • A bot loops through irrelevant options
  • Customers can’t reach a human when they need one
  • Responses sound generic and miss the actual issue

At that point, automation creates friction instead of removing it. The customer service department ends up dealing with more frustrated users, not fewer.

The root problem is treating AI like a shortcut instead of a resolution tool. It’s often deployed to handle volume from multiple customers, but without enough context or capability to actually solve customer concerns.

Better use of automation starts with a simple rule: only automate what you can complete end-to-end.

  • Order status checks
  • Password resets
  • Simple account updates

Anything more complex should escalate quickly, with full context intact.

This is where platforms like Quiq stand out. Instead of basic bots, Quiq’s agentic AI can take action within customer conversations, not just respond. It can check systems, complete tasks, and resolve common issues without bouncing the customer around.

Just as important, when a human steps in, they inherit everything:

  • Full conversation history
  • Actions already taken
  • Clear next steps

No repetition, no reset.

For example, if a customer starts with a billing issue, AI can gather details, verify the account, and attempt a fix. If escalation is needed, the agent continues from that exact point, not from the beginning.

10. Ignoring or underutilizing customer feedback

Customer feedback is everywhere, but most teams don’t actually use it.

They collect surveys, reviews, and support data, then leave it sitting in dashboards. That creates a gap between what customers are saying and how the business responds. Over time, the same issues repeat, and dissatisfied customers keep running into problems that were already flagged.

This is usually a follow-through problem.

You’ll see it in patterns like:

  • The same complaint shows up across tickets, but nothing changes
  • Product issues are reported, but never prioritized
  • Feedback is collected to measure customer satisfaction, not improve it

Meanwhile, customer service representatives are on the front lines hearing the same customer concerns every day, but that insight rarely makes it into product or operational decisions.

To fix this, feedback needs to become part of how decisions are made, not just something you track.

  • Group feedback into clear themes, not individual tickets
  • Identify issues that impact multiple customers
  • Prioritize changes based on real usage and revenue impact
  • Close the loop by telling customers what changed

For example, if customers repeatedly complain about a confusing billing page, don’t just respond with explanations. Fix the page, then follow up with those users to show the issue was addressed.

AI can help by analyzing large volumes of feedback and identifying patterns tied to customer preferences. With tools like Quiq, conversations can be automatically grouped, summarized, and linked to recurring issues, making it easier to act on what matters.

11. Fragmented internal systems and workflows

Fragmented systems are one of the biggest reasons support feels slow and inconsistent, even when teams are working hard.

Most customer support teams rely on multiple tools, help desk, CRM, billing, chat, internal docs. The problem isn’t the tools themselves; it’s that they don’t work together. Agents end up switching between tabs just to address customer concerns, which slows everything down and increases the chance of mistakes.

You’ll see this in everyday interactions:

  • An agent asks for information that already exists in another system
  • A billing issue requires checking three different tools before responding
  • Internal notes are missed because they’re stored elsewhere

This creates delays and leads to inconsistent answers. Two agents handling the same issue might give different responses simply because they’re looking at different pieces of information. That’s how consistent service quality breaks down.

The fix is reducing friction between your tools.

  • Bring key customer data into one view during conversations
  • Standardize workflows for common issues
  • Make internal knowledge easy to access in real time
  • Reduce the need for manual lookups and handoffs

For example, if a customer asks about a refund, the agent should immediately see order history, past interactions, and current status without leaving the conversation.

AI can help by acting as a bridge between systems. With platforms like Quiq, relevant data is surfaced directly inside the conversation, so agents don’t have to search across tools. Suggested actions and workflows guide the response, keeping answers aligned and efficient.

12. Scaling support without losing quality

Scaling support sounds simple until volume spikes and quality drops at the same time.

More tickets, more customer inquiries, more pressure on the team. Without the right setup, this leads to slow response times, rushed answers, and more frustrated customers. You might handle more volume, but the experience gets worse.

You’ll typically see:

  • First response time improves, but resolution quality drops
  • Agents rely on shortcuts or generic replies
  • Escalations increase as issues aren’t fully solved

At that point, you’re scaling output, not high-quality customer service.

The core challenge is maintaining consistency as demand grows. You need systems that help every agent perform like your best agents, not just add more people.

A better approach focuses on leverage:

  • Standardize responses for common issues without sounding robotic
  • Give agents clear guidance and context in real time
  • Reduce repetitive work so agents can focus on complex cases

For example, instead of hiring aggressively to handle order status questions, automate those end to end and free up agents for cases that require judgment.

This is where tools like Quiq make a real difference. Its agentic AI can handle high volume, repetitive tasks across multiple customers while keeping conversations contextual. It doesn’t just reply, it completes actions like checking orders or updating accounts.

When escalation is needed, agents step in with full context and suggested next steps. That keeps responses sharp and reduces back and forth.

The result is faster handling without sacrificing quality. You’re able to exceed customer expectations even as volume grows.

13. Misaligned KPIs and performance metrics

Most teams track a lot of metrics. The problem is they often track the wrong ones.

When KPIs are misaligned, you end up optimizing for numbers instead of outcomes. That’s how customer service problems get masked instead of fixed.

You’ll see this in practice:

  • Agents rush replies to improve first response time, but don’t solve the issue
  • Tickets are closed quickly to hit targets, even if the customer reopens them
  • Average handle time drops, but back and forth increases

On paper, everything looks efficient. In reality, the support process is getting worse.

The core issue is measuring activity instead of impact. Metrics like speed and volume matter, but they don’t guarantee great customer service or a seamless support experience.

A better approach is to align KPIs with actual outcomes:

  • Focus on first contact resolution, not just response speed
  • Track whether issues are truly solved, not just closed
  • Measure customer effort alongside satisfaction
  • Tie support performance to retention or repeat issues

For example, a team might reduce response time from two hours to 30 minutes, but if customers still need three follow-ups, nothing has improved.

This is where AI can help surface what actually matters. Tools like Quiq can analyze conversations to identify resolution quality, repeated issues, and where interactions break down. Instead of relying on surface-level metrics, teams get visibility into what’s driving outcomes and where to apply relevant solutions.

How Quiq can help you improve customer satisfaction and create a customer-centric culture

Improving customer satisfaction usually comes down to one thing: how well your team handles real interactions under pressure.

That’s where Quiq fits in.

It brings messaging, automation, and agent tools into a single workspace, so your team isn’t jumping between systems or guessing what happened before. Conversations stay connected, context carries over, and responses are more consistent across every channel.

The biggest shift comes with Voice AI.

Instead of forcing customers through rigid IVR menus, Quiq’s Voice AI lets them speak naturally. The system can understand intent, not just keywords, and respond in real time using natural conversation.

In practice, that changes how support feels:

  • Customers explain their issue once, in their own words
  • Common requests like order status or account updates are handled instantly
  • More complex cases are passed to agents with full context already captured

For example, a customer calling about a billing issue doesn’t need to press options or repeat details. The system can identify the problem, pull the relevant data, and either resolve it or hand it off cleanly.

This is where Voice AI becomes useful, not as a replacement for agents, but as a way to remove friction before the agent even joins the conversation.

Behind the scenes, Quiq connects voice and messaging into one flow, so support doesn’t feel fragmented. AI handles the repetitive work, and agents focus on the parts that need judgment.

Book a free demo with our team to learn more.

Frequently Asked Questions (FAQs)

What is the biggest factor that impacts customer expectations?

Customer expectations are shaped by speed, clarity, and consistency across every interaction. If customers know how long something will take and what will happen next, they’re far less likely to get frustrated. Clear communication, visible response times, and predictable outcomes matter more than trying to be the fastest at everything.

How can teams deliver excellent customer service at scale?

Excellent customer service at scale comes from consistency, not just hiring more agents. Teams need clear processes, shared context, and the right level of automation to handle repetitive tasks. When agents have full visibility into past interactions and can resolve issues in one go, quality stays high even as volume increases.

Why is proactive communication so important in customer service?

Proactive communication prevents issues from escalating. Instead of waiting for customers to reach out, teams can share updates, delays, or changes before frustration builds. This is especially important during outages or high-volume periods, where clear and timely updates can significantly improve the overall customer service experience.

What defines a strong customer service experience today?

A strong customer service experience is fast, consistent, and effortless. Customers shouldn’t have to repeat themselves, switch channels to get answers, or wait without updates. When interactions feel connected, and issues are resolved quickly, customers are more likely to trust the brand and stay loyal.

What KPIs should CX leaders track to measure improvement?

Key metrics include CSAT, NPS, first response time, and resolution rate. For teams using Quiq’s agentic AI solution, analytics dashboards provide real-time visibility into these metrics, helping leaders identify bottlenecks and continuously improve customer experience.

Request A Demo

Understanding LLMs vs Generative AI for Business Leaders

Key Takeaways

  • Large language models (LLMs) are a specific subset of generative AI that focuses exclusively on text-focused tasks, while generative AI encompasses all AI systems that create new content including images, audio, video, and code.
  • LLMs like GPT-4 and Claude excel at text-based business applications such as customer service automation, content creation, document summarization, and code generation, but cannot produce visual or multimedia content.
  • Generative AI works by using different architectures for different content types—transformers power LLMs for text, diffusion models create images in tools like DALL-E, and GANs generate realistic visual content.
  • As a broader concept, agentic AI represents the next evolution beyond basic generative AI by combining LLM capabilities with autonomous workflow execution, enabling systems to complete multi-step tasks and solve problems rather than just respond to prompts.

The terms “generative AI” and “LLM” get tossed around interchangeably in boardrooms and vendor pitches, but they’re not the same thing. Generative AI focuses on creating new content—text, images, audio, video—while large language models (LLMs) are a specific subset focused exclusively on understanding and generating text.

Getting this distinction right matters when you’re evaluating AI solutions, talking to vendors, or explaining technology choices to stakeholders. Key differences between these technologies become clear once you understand how they relate.

This guide breaks down how these technologies relate, where each excels, and what enterprise leaders should look for when bringing AI into customer experience.

Generative AI vs LLM: What’s the actual difference?

Generative AI is the broad category of artificial intelligence that creates new content—text, images, audio, video, and code—based on patterns learned from training data. Large language models, or LLMs, are a specific type of generative AI designed to understand and generate human-like text.

Put simply: all LLMs are generative AI, but not all generative AI systems are LLMs.

The easiest way to picture this relationship is as an umbrella. Generative AI is the umbrella, and LLMs sit underneath it alongside image creators like DALL-E, music composers, and video synthesis tools.

When you chat with ChatGPT, you’re using an LLM to engage in language generation. When you create marketing visuals with Midjourney, you’re using generative AI that isn’t an LLM.

Generative AILLMs
ScopeBroad (text, images, video, audio, code)Text-focused only
Output typesMultiple content formatsWritten language
ExamplesDALL-E, Midjourney, GPT, WhisperGPT-4, Claude, Llama, Gemini
RelationshipThe umbrella categoryA subset of generative AI

What are LLMs in AI?

Large language models are AI systems trained on vast amounts of text data using a neural network architecture called transformers. LLMs focus on text-based tasks like writing, summarization, coding, translation, and conversation. The “large” in LLM refers to the billions of parameters—adjustable settings that help the model recognize language patterns in textual data.

How large language models process and generate text

LLMs work by predicting the next word, or “token,” based on patterns learned during training. When you type a prompt, the model analyzes your input and generates a response one token at a time. Each prediction builds on everything that came before it.

A token isn’t always a complete word. It might be a word fragment, punctuation mark, or space. GPT-4, for instance, breaks text into roughly 100,000 different tokens. Tokenization allows the model to handle unfamiliar words by assembling them from known pieces.

Common LLM applications for business

In enterprise settings, LLMs power a range of practical applications:

  • Content creation: Blog posts, emails, product descriptions, and marketing copy.
  • Document summarization: Condensing lengthy reports, research papers, or meeting transcripts.
  • Code generation tools: Writing, explaining, and debugging code across programming languages.
  • Language translation: Converting text between languages while preserving context and tone, allowing teams to translate languages at scale.
  • Conversational AI: Powering chatbots and virtual assistants for customer interactions.

What is generative AI?

Generative AI refers to any artificial intelligence system capable of consistent content creation rather than simply analyzing or classifying existing data. Generative AI encompasses a wide range of tools and architectures.

While LLMs handle text, other gen AI platforms produce images, audio, video, and more, often using entirely different underlying architectures.

Types of content generative AI creates

The range of outputs from generative AI continues to expand:

  • Text: Via LLMs like GPT-4 and Claude.
  • Images: Tools like DALL-E, Midjourney, and Stable Diffusion.
  • Audio: Speech synthesis, voice cloning, and music generation.
  • Video: AI-generated video content from tools like Sora.
  • Code: Both text-based code generation and visual development tools.

How generative AI extends beyond text

Image generators like Midjourney use diffusion models—a completely different architecture from the transformers powering LLMs. Audio tools like Whisper handle speech recognition and speech-to-text transcription, while Sora generates video from text prompts, making video generation increasingly accessible.

Some newer systems are multimodal, meaning they can process and generate multiple content types. GPT-4, for example, can analyze images alongside text.

Multimodal capabilities are blurring the lines between categories, though the underlying distinction remains useful for understanding what each tool does well.

Artificial intelligence, generative AI, and LLMs: How they relate to each other

The relationship between AI, generative AI, and LLMs is hierarchical. Each category nests inside a broader one:

  • Artificial Intelligence (AI): The broadest field, encompassing any system designed to perform tasks requiring human-like intelligence.
  • Generative AI: AI that creates new content based on learned patterns.
  • LLMs: Generative AI specialized for understanding and producing text.

Machine learning sits between AI and generative AI in this hierarchy. LLMs specifically use deep learning techniques—a subset of machine learning that employs neural networks with many layers. The transformer architecture, introduced in 2017, made modern LLMs possible by allowing models to process entire sequences of text simultaneously rather than word by word.

Generative adversarial networks and other generative AI architectures

Not all generative AI uses transformer models.

Generative adversarial networks (GANs) were among the first architectures capable of producing realistic images by pitting two neural networks against each other—a generator and a discriminator. GANs can create realistic images and other media by learning the underlying patterns in input data.

Diffusion models have since become dominant for image generation, but GANs remain an important part of the broader generative AI landscape and the history of AI development in computer science.

Foundation models and their role in the AI landscape

Foundation models are large-scale AI models trained on extensive text data and other data types, then adapted for a wide range of downstream tasks.

Both LLMs and many generative AI models are built on foundation model principles—they are trained once on vast amounts of data and fine-tuned for specific applications.

Understanding these models helps clarify why generative AI and LLMs have become so capable so quickly. Model evaluation typically examines performance across language tasks, reasoning, and generalization to new data.

AI models: LLM vs generative AI advantages and limitations

Each approach has distinct strengths and constraints. Understanding the tradeoffs helps when selecting AI for specific business applications.

LLM strengths for enterprise use

LLMs bring several capabilities that matter for business applications:

  • Nuanced language understanding: LLMs grasp context, tone, and intent in ways earlier natural language processing tools couldn’t match.
  • Conversational continuity: They maintain context across multi-turn interactions, remembering what was discussed earlier in a conversation.
  • Specialized text tasks: Summarization, translation, and writing assistance are particular strengths.
  • Code assistance: Many LLMs excel at generating, explaining, and debugging code.

LLM limitations for business applications

At the same time, LLMs have real constraints:

  • Text-only output: Standard LLMs can’t generate images, audio, or video.
  • Hallucination risk: They sometimes produce plausible-sounding but incorrect information with complete confidence.
  • Governance requirements: Enterprise deployment requires guardrails and oversight to prevent problematic outputs.
  • Context window constraints: Even large context windows have limits when processing very long documents.

Generative AI strengths for enterprise use

Broader gen AI platforms offer different advantages:

  • Multimodal content: Create visuals, audio, and video alongside text.
  • Creative applications: Product design mockups, marketing visuals, and multimedia campaigns.
  • Wider use cases: Address communication formats that extend beyond written text.

Generative AI limitations for business applications

However, generative AI also comes with challenges:

  • Tool fragmentation: Different content types often require different platforms.
  • Consistency challenges: Maintaining brand voice across modalities can be difficult.
  • Quality variation: Output quality differs significantly across tools and use cases, making data quality a key concern.

AI vs manual processes: When to use LLMs vs generative AI

The choice between LLMs and broader gen AI depends largely on what you’re trying to accomplish. Here’s how the decision typically breaks down.

Customer service and support automation

LLMs excel at text-based customer conversations—chat, email, and messaging support. They handle complex, multi-turn dialogues where context matters, and they can adapt responses based on conversation history.

Basic LLMs alone don’t maintain context when customers switch channels or move between AI and human agents. Agentic AI platforms add value here by connecting LLM capabilities with workflow execution and cross-channel continuity.

Content creation and marketing

For written content like blog posts, email campaigns, product descriptions, and social copy, LLMs are the natural fit. For marketing visuals, product mockups, video content, or audio ads, gen AI platforms designed for specific outputs work better.

Many marketing teams use generative AI and LLMs together: an LLM for copy and a separate image generator for visuals. The key is matching the tool to the output type you’re creating.

Data analysis and business insights

LLMs help with document summarization, report generation, and extracting insights from unstructured text. They can analyze customer feedback, synthesize research findings, or draft executive summaries.

Other gen AI platforms assist with data visualization, though traditional business intelligence platforms often handle visualization better.

AI systems and AI tools: Examples of large language models

The LLM landscape evolves quickly, but several major players dominate enterprise conversations today. Both generative AI systems and LLMs and generative AI tools more broadly are advancing rapidly, so understanding the leading options matters for any AI vs status-quo evaluation.

GPT models

OpenAI’s GPT family powers ChatGPT and remains the most widely recognized language model. GPT-4 introduced multimodal capabilities, allowing it to analyze images alongside text.

Claude

Anthropic’s Claude models emphasize helpfulness and safety. Claude is known for longer context windows and strong performance on analysis tasks.

Gemini

Google DeepMind’s Gemini models are natively multimodal, trained from the ground up on text, images, and other data types.

Llama

Meta’s open-source Llama family allows organizations to run capable models on their own infrastructure, addressing data privacy and customization requirements.

Generative AI options beyond LLMs

For non-text content generation, different tools apply:

  • DALL-E and Midjourney for images
  • Whisper for audio transcription
  • Sora for video generation

Each uses architectures distinct from the transformer models powering LLMs. Advanced models in each category continue to improve the ability to produce images, generate human language, and create realistic images from simple prompts.

What business leaders should consider when evaluating AI

Beyond the technical distinctions, several strategic factors matter when selecting AI solutions for enterprise use.

Transparency and explainability

Enterprises benefit from understanding how AI reaches conclusions. “Black box” intelligent systems create risk—when something goes wrong, diagnosing the cause becomes difficult. Decision visibility matters for compliance, brand protection, and troubleshooting.

Governance and guardrails

Control over AI outputs, audit trails for compliance, and configurable boundaries all factor into enterprise readiness. AI that produces off-brand or inappropriate responses can damage customer relationships and reputation.

Integration and scalability

How does the AI fit with existing CRM, support systems, and workflows? Can you scale from pilot to production without rebuilding? Model-agnostic approaches offer flexibility as the underlying technology evolves.

Continuous context across channels

For customer experience use cases, maintaining conversation context across voice, chat, SMS, and social matters enormously. Customers shouldn’t have to repeat themselves when switching channels or moving between AI and human agents.

Where agentic AI fits in the gen AI and LLM landscape

Agentic AI represents the next evolution: AI that goes beyond generating content to taking goal-oriented actions. Rather than simply responding to prompts, agentic systems can execute workflows, make decisions, and complete multi-step tasks autonomously.

Agentic platforms typically use LLMs as their foundation but add layers of autonomy, reasoning, and action-taking capability. The distinction matters: a basic LLM responds to questions, while an agentic AI resolves problems.

For customer experience, agentic AI means systems that don’t just answer questions but actually solve problems—processing returns, updating accounts, troubleshooting issues—while maintaining context and operating within defined guardrails. Reinforcement learning is increasingly used to train these systems to make better decisions over time, and artificial general intelligence remains a longer-term horizon that agentic AI is beginning to approach in narrow domains.

Choosing the right AI for your customer experience

The difference between generative AI and LLMs matters for selecting the right tools. For customer experience specifically, what matters most is transparency, continuous context, and control.

Enterprise leaders benefit from AI that operates as an extension of their brand rather than a black box. Visibility into how decisions are made, context that persists across channels and handoffs, and guardrails that keep interactions on track all contribute to successful deployment.

If you’re exploring how agentic AI can improve your customer experience while maintaining the control and visibility your enterprise requires, book a demo to see how it works in practice.

FAQs about LLMs and generative AI

Is ChatGPT an LLM or generative AI?

ChatGPT is both. Powered by GPT—a large language model—and LLMs are a type of generative AI, ChatGPT falls into both categories by definition.

What is the difference between LLM and GPT?

GPT (Generative Pre-trained Transformer) is a specific family of large language models (LLMs) created by OpenAI. LLM is the broader category that includes GPT along with models like Claude, Gemini, and Llama. Think of GPT as a brand name and LLM as the product category.

Can LLMs generate images or only text?

Standard LLMs generate text only. Creating images requires different generative AI models—like DALL-E or Midjourney—that use architectures designed specifically for visual content. Some multimodal models can analyze images as input, but text generation remains their primary function.

Are all AI chatbots powered by LLMs?

Not all chatbots use LLMs. Some rely on rule-based systems or simpler models with predefined conversation flows. However, most modern conversational AI platforms use LLMs to handle complex, natural language interactions that older approaches couldn’t manage effectively.

What is the difference between LLM and machine learning?

Machine learning is the broad field of AI that learns from data. LLMs are a specific application of machine learning—they use deep learning and transformer architecture to understand and generate human language. All LLMs use machine learning, but most machine learning applications aren’t LLMs.

How is a generative AI model trained?

Generative AI models are trained by exposing them to massive datasets and having them learn to predict patterns — such as what word comes next in a sentence — with their internal parameters adjusted iteratively until they improve. They are then refined through human feedback and safety testing to make their outputs more helpful, accurate, and aligned with intended behavior.

Interpretability vs Explainability: Key Differences

Key takeaways

  • Interpretability and explainability aren’t the same: Interpretability helps you understand how a model works, while explainability helps you understand why it made a specific decision.
  • Both concepts help make AI less of a black box: They give teams clearer visibility into the model’s behavior and outputs.
  • These approaches are increasingly important as AI is adopted in real-world settings: Contact centers, in particular, benefit from understanding how AI models support agents and customers.
  • Interpretability goes deeper than explainability: Knowing the inner mechanics of a model provides a stronger foundation for trust, safety, and better decision-making.

In recent months, we’ve produced a tremendous amount of content about generative AI – from high-level primers on what large language models are and how they work, to discussions of how they’re transforming contact centers, to deep dives on the cutting edge of generative technologies.

Much of this progress comes from pre-trained models, which are trained on massive datasets and then adapted to specific tasks, making them powerful but harder to fully understand.

This amounts to thousands of words, much of it describing how models like ChatGPT were trained, e.g., by iteratively predicting the final sentence of a paragraph given the previous sentences.

But for all that, there’s still a tremendous amount of uncertainty about the inner workings of advanced machine-learning systems. Even the people who build them generally don’t understand how specific functions emerge or what a particular circuit does in real-world applications.

Much of this uncertainty comes from the complexity of a deep learning system, where millions or even billions of parameters interact in ways that are difficult to trace.

It would be more accurate to describe these systems as having been grown, like an inconceivably complex garden. And just as you might have questions if your tomatoes started spitting out math proofs, it’s natural to wonder why generative models are behaving in the way that they are.

These questions are only going to become more important as these technologies are further integrated into contact centers, schools, law firms, medical clinics, and the economy in general.

If we use machine learning algorithms to decide who gets a loan, who is likely to have committed a crime, or to have open-ended conversations with our customers, it really matters that we know how all this works in real, human terms.

The two big approaches to this task are explainability and interpretability.

Before going further: the black box model

One of the biggest challenges in modern AI is the rise of the black box model. These are systems where inputs and outputs are visible, but the internal decision-making process is difficult or impossible to fully understand.

Most advanced AI today, especially large language models and other deep learning systems, fall into this category. Even model developers often cannot clearly explain how specific outputs are generated, only that the model has learned patterns from vast amounts of data.

This lack of transparency is what makes concepts like interpretability and explainability so important. When working with complex black box models, teams need tools and techniques that help uncover either how the model works internally or why it made a particular decision.

For example, instead of directly inspecting the internal structure of a model, explainability techniques like SHAP or LIME approximate its behavior to provide insights into individual predictions. Interpretability approaches, on the other hand, attempt to open up the model itself and understand its internal logic.

As AI systems are increasingly used in high-stakes environments like healthcare, finance, and customer support, relying on black box models without understanding them is no longer acceptable. Teams need visibility into these systems to ensure accuracy, fairness, and accountability.

Interpretability and explainability defined

Interpretability is the ability to understand how an AI model processes information and arrives at a specific output. It focuses on revealing which input data, features, or patterns most influenced the interpretable model’s decision-making process. High interpretability helps users trust and validate the interpretable model’s behavior because it makes the decision-making process more transparent.

Some models are easier to understand than others. Inherently interpretable models, such as linear regression or decision trees, are designed in a way that makes their decision-making process transparent from the start.

Explainability is the ability of an AI system to clearly communicate why it produced a certain result in a way humans can understand. It provides context, reasoning, or simplified representations of the model’s internal logic. Effective explainability bridges the gap between complex algorithms and user comprehension, making AI outputs more actionable and trustworthy.

Explainability is the ability of an AI system to clearly communicate why it produced a certain result in a way humans can understand.

This is where explainable AI (XAI) comes in, a set of methods and tools that help make complex models more transparent and their decisions easier to interpret. This concept is central to explainable artificial intelligence, which focuses on making complex models more transparent and their decisions easier to understand.

Comparing explainability and interpretability

Broadly, explainability means analyzing the behavior of a model to understand why a given course of action was taken. If you want to know why data point “a” was sorted into one category while data point “b” was sorted into another, you’d probably turn to one of the explainability techniques described below.

InterpretabilityExplainability
Core focusUnderstanding how a model works internallyUnderstanding why a model made a specific decision
Main goalReveal model structure, features, and mechanicsProvide human-friendly reasoning behind outputs
Level of detailDeeper, focuses on inner workings like weights, coefficients, and data flowHigher-level, focuses on outcomes and reasoning
Type of insightTechnical insight into model behaviorContextual insight into individual predictions
Typical questions answered“How does this model process inputs?”“Why did the model make this prediction?”
Techniques usedMechanistic interpretability, model inspection, feature and data analysisSHAP, LIME, natural language explanations, visualizations
ScopeGlobal, covers the entire modelOften local, focused on specific predictions
Ease of understandingMore technical, suited for engineers and data scientistsEasier to understand, suitable for non-technical stakeholders
Use casesModel debugging, validation, fairness checks, model selectionDecision justification, stakeholder communication, compliance
ExampleUnderstanding how feature weights influence outcomes in a regression modelExplaining why a loan application was approved or rejected
StrengthBuilds deep trust by exposing model logicBuilds practical trust by clarifying decisions
LimitationCan be difficult with complex models like deep neural networksMay simplify or approximate true model behavior

Interpretability means making features of a model, such as its weights or coefficients, comprehensible to humans. Linear regression models, for example, calculate sums of weighted input features, and interpretability would help you understand what exactly that means.

Interpretability is often highest in simpler or inherently interpretable models, while complex black box models require explainability techniques to understand their decisions.

Here’s an analogy that might help: you probably know at least a little about how a train works. Understanding that it needs fuel to move, has to have tracks constructed a certain way to avoid crashing, and needs brakes in order to stop would all contribute to the interpretability of the train system.

But knowing which kind of fuel it requires and for what reason, why the tracks must be made out of a certain kind of material, and how exactly pulling a brake switch actually gets the train to stop are all facets of the explainability of the train system.

Explainability in machine learning

Before we turn to the techniques utilized in machine learning explainability, let’s talk at a philosophical level about the different types of explanations you might be looking for.

Different types of explanations

There are many approaches you might take to explain an opaque machine-learning model. Here are a few:

  • Explanations by text: One of the simplest ways of explaining a model is by reasoning about it with natural language. The better sorts of natural-language explanations will, of course, draw on some of the explainability techniques described below. You can also try to talk about a system logically, by i.e. describing it as calculating logical AND, OR, and NOT operations.
  • Explanations by visualization: For many kinds of models, visualization will help tremendously in increasing explainability. Support vector machines, for example, use a decision boundary to sort data points and this boundary can sometimes be visualized. For extremely complex datasets this may not be appropriate, but it’s usually worth at least trying. Visualization is especially useful in areas like computer vision, where image classification models can highlight which parts of an image influenced a prediction.
  • Local explanations: There are whole classes of explanation techniques, like LIME, that operate by illustrating how a black-box model works in some particular region. In other words, rather than trying to parse the whole structure of a deep neural network, we zoom in on one part of it and say “This is what it’s doing right here.”

Approaches to explainability in machine learning and artificial intelligence

Now that we’ve discussed the varieties of explanation, let’s get into the nitty-gritty of how explainability in machine learning works. There are a number of different explainability techniques, but we’re going to focus on two of the biggest: SHAP and LIME.

Shapley Additive Explanations (SHAP) are derived from game theory and are a commonly-used way of making models more explainable. The basic idea is that you’re trying to parcel out “credit” for the model’s outputs among its input features. In game theory, potential players can choose to enter a game, or not, and this is the first idea that is ported over to SHAP.

SHAP “values” are generally calculated by looking at how a model’s output changes based on different combinations of features. If that same model has, say, 10 input features, you could look at the output of four of them, then see how that changes when you add a fifth.

By running this procedure for many different feature sets, you can understand how any given feature contributes to the ML model’s overall predictions.

Local Interpretable Model-Agnostic Explanation (LIME) is based on the idea that our best bet in understanding a complex model is to first narrow our focus to one part of it, then study a simpler model that captures its local behavior.

Example of model explainability in machine learning

Let’s work through an example. Imagine that you’ve taken an enormous amount of housing data and fit a complex random forest model that’s able to predict the price of a house based on features like how old it is, how close it is to neighbors, etc.

LIME lets you figure out what the random forest is doing in a particular region, so you’d start by selecting one row of the data frame, which would contain both the input features for a house and its price. Then, you would “perturb” this sample, which means that for each of its features and its price, you’d sample from a distribution around that data point to create a new, perturbed dataset.

You would feed this perturbed dataset into your random forest model and get a new set of perturbed predictions. On this complete dataset, you’d then train a simple model, like a linear regression.

Linear models are almost never as flexible and powerful as a random forest, but they do have one advantage: they comes with a bunch of coefficients that are fairly easy to interpret.

This LIME approach won’t tell you what the model is doing everywhere, but it will give you an idea of how the model is behaving in one particular place. If you do a few LIME runs, you can form a picture of how the model is functioning overall.

Benefits of explainability and explainable artificial intelligence

Explainability brings several key advantages that strengthen both model performance and stakeholder trust:

  • Builds confidence and transparency: By revealing why a model made a certain prediction, explainability reduces the “black box” effect and helps users feel more comfortable relying on AI-driven decisions. Interpretability helps teams understand which features influence predictions, turning model behavior into actionable insights and supporting knowledge discovery.
  • Improves error and bias detection: Clear insights into model reasoning make it easier to spot inaccuracies, unintended patterns, or biased outcomes before they create real-world issues.
  • Supports accountability in high-stakes use cases: Industries like healthcare, finance, and employment require explainable decisions to ensure fairness, compliance, and ethical use of AI.
  • Speeds up debugging and optimization: Engineers can more efficiently identify which features drive model behavior, enabling faster iteration and more targeted improvements.
  • Enhances communication with non-technical stakeholders: Explainability simplifies complex model logic so business leaders can validate results, make informed decisions, and better integrate AI into workflows.

Together, these benefits make explainability a crucial component of deploying machine learning systems that are trustworthy, safe, and effective.

Model interpretability in machine learning

In machine learning, interpretability refers to a set of approaches that shed light on a model’s internal workings.

SHAP, LIME, and other explainability techniques can also be used for interpretability work. Rather than go over territory we’ve already covered, we’re going to spend this section focusing on an exciting new field of interpretability, called “mechanistic” interpretability.

Mechanistic interpretability: a new frontier for the interpretable model

Mechanistic interpretability is defined as “the study of reverse-engineering neural networks”. Rather than examining subsets of input features to see how they impact a model’s output (as we do with SHAP) or training a more interpretable local model (as we do with LIME), mechanistic interpretability involves going directly for the goal of understanding what a trained neural network is really, truly doing.

It’s a very young field that so far has only tackled networks like GPT-2 – no one has yet figured out how GPT-4 functions – but already its results are remarkable. It will allow us to discover the actual machine learning algorithms being learned by large language models, which will give us a way to check them for bias and deceit, understand what they’re really capable of, and how to make them even better.

Benefits of interpretability

Interpretability offers essential advantages by making it clearer how a model processes inputs and arrives at its outputs:

  • Increases transparency into model behavior: Interpretability helps teams understand which features or data points influence predictions, reducing uncertainty around how the model “thinks.”
  • Improves debugging and quality control: When engineers can trace decision paths, they can more easily diagnose performance issues, identify data problems, and refine the model’s structure.
  • Supports fairness and bias mitigation: By revealing which factors drive decisions, interpretability makes it easier to spot and correct biased patterns early in the modeling process.
  • Strengthens stakeholder trust: Clear visibility into model logic reassures users, especially in regulated industries, that the system behaves logically and consistently.
  • Enables better model selection: Interpretability allows teams to compare models not just on accuracy, but on how understandable and predictable their decision-making is, leading to more reliable deployment choices.

Overall, interpretable machine learning models are not only high-performing but also transparent, responsible, and easier to validate in real-world settings.

Why are interpretability and explainability important?

Interpretability and explainability are both very important areas of ongoing research. Not so long ago (less than twenty years), neural networks were interesting systems that weren’t able to do a whole lot.

Today, they are feeding us recommendations for news, entertainment, driving cars, trading stocks, generating reams of content, and making decisions that affect people’s lives, forever.

This technology is having a huge and growing impact, and it’s no longer enough for us to have a fuzzy, high-level idea of what they’re doing.

We now know that they work, and with techniques like SHAP, LIME, mechanistic interpretability, etc., we can start to figure out why they work.

Final thoughts

Large language models are reshaping how contact centers operate, delivering new levels of efficiency and customer satisfaction. Yet despite their impact, much of what happens inside these models remains difficult to fully understand, even for model developers. While no contact center manager needs to become an expert in interpretability or explainability, understanding these general concepts can help you make smarter, safer decisions about how to adopt generative AI.And if you’re ready to explore those possibilities, consider partnering with one of the most trusted names in agentic AI. Quiq’s platform now includes powerful tools designed to make agents more efficient and customers more satisfied. Set up a demo today to see how we can help you elevate your contact center.

Frequently Asked Questions (FAQs)

What’s the difference between interpretability and explainability?

 Interpretability shows you how a model works, what features it uses, and how it processes information. Explainability shows you why the model made a specific decision, giving you a clear, human-friendly rationale for an output. Together, they help demystify AI behavior.

Why are these concepts important?

They provide visibility into systems that would otherwise operate as black boxes. This transparency helps teams trust model outputs, validate that the system behaves as expected, and ensure AI aligns with business goals and ethical standards.

Can a model be explainable without being fully interpretable?

Yes. Complex models like large language models may not reveal every internal mechanism, but they can still provide useful explanations for their predictions. This allows teams to work confidently with high-performing models without needing full access to their internal logic.

How do interpretability and explainability support better decision-making?

They help teams pinpoint why an output occurred, identify potential issues like bias or data drift, and troubleshoot unexpected behavior. This leads to safer, more reliable AI deployments and faster iteration on model improvements.

Do contact centers need deep expertise in these areas?

Not at all. Leaders simply need enough understanding to ask the right questions and evaluate whether an AI tool behaves consistently, safely, and in line with customer experience goals. A vendor like Quiq helps handle the heavy lifting.

AI Model Evaluation: 2026 Guide

Key takeaways

  • AI performance starts with evaluation. Metrics and human insight work together to keep models accurate, reliable, and bias-free.
  • Use the right tools for the job. Regression relies on MSE or RMSE; classification leans on accuracy, precision, and recall.
  • Generative AI needs extra care. Scores like BLEU and BERT help, but human review ensures outputs sound natural and on-brand.
  • Trust is built through testing. Continuous evaluation keeps AI aligned with real-world performance and customer expectations.

Machine learning is an incredibly powerful technology. That’s why it’s being used in everything from autonomous vehicles to medical diagnoses to the sophisticated, dynamic AI Assistants that are handling customer interactions in modern contact centers.

But for all this, it isn’t magic. The engineers who build these systems must know a great deal about how to evaluate them. How do you know when a model is performing as expected, or when it has begun to overfit the data? How can you tell when one of the multiple models is better than another?

That’s where AI model evaluation comes in. At its core, AI model evaluation is the process of systematically measuring and assessing an AI system’s performance, accuracy, reliability, and fairness. This includes using quantitative metrics (like accuracy or BLEU), testing with unseen data, and incorporating human review to check for issues such as biased outcomes or coherence.

It’s a critical step for determining a model’s readiness for real-world deployment, ensuring trustworthiness, and guiding continuous improvement.

This subject will be our focus today. We’ll cover the basics of evaluating a machine learning model with metrics like mean squared error and accuracy, then turn our attention to the more specialized task of evaluating the generated text of a large language model like ChatGPT.

How to evaluate model performance

A machine learning model is always aimed at some task. It might be predicting sales, grouping topics, generating text, or some other type of model performance.

How does the model know when it’s gotten the optimal line or discovered the best way to cluster documents?

In the next few sections, we’ll talk about a few common evaluation methods for a machine-learning model. If you’re an engineer, this will help you create better models yourself, and if you’re a layperson, it’ll help you better understand how the machine-learning pipeline works and you’ll get the baseline of how the evaluation process looks like.

To answer that, the evaluation must assess multiple dimensions:

  1. performance (are the predicted values accurate?)
  2. weaknesses (does it generalize to unseen data or overfit?)
  3. trustworthiness (can it be explained and trusted?)
  4. fairness (is it biased toward certain groups?).

Together, these components give a complete picture of model quality.

Model evaluation metrics for regression models

Regression is one of the two big types of basic machine learning, with the other being classification.

In tech-speak, we say that the purpose of a regression model is to learn a function that maps a set of input features to a real value (where “real” just means “real numbers”).

This is not as scary as it sounds; you might try to create a regression model that predicts the number of sales you can expect given that you’ve spent a certain amount on advertising, or you might try to predict how long a person will live on the basis of their daily exercise, water intake, and diet.

In each case, you’ve got a set of input features (advertising spend or daily habits), and you’re trying to predict a target variable (sales, life expectancy).

The relationship between the two is captured by a model, and a model’s quality is evaluated with a metric. Popular metrics for regression models include:

  • mean squared error (MSE)
  • root mean squared error (RMSE)
  • mean absolute error (MAE)

However, there are plenty of others if you feel like going down a nerdy rabbit hole.

Model evaluation metrics for classification models

People tend to struggle less with understanding classification models because it’s more intuitive: you’re building something that can take a data point (the price of an item) and sort it into one of a number of different categories (i.e., “cheap”, “somewhat expensive”, “expensive”, “very expensive”).

Regardless, it’s just as essential to evaluate the performance of a classification model as it is to evaluate the performance of a regression model. Some common evaluation metrics for classification models are accuracy, precision, and recall.

Accuracy is simple, and it’s exactly what it sounds like. You find the accuracy of a classification model by dividing the number of correct predictions it made by the total number of predictions it made altogether. If your classification model made 1,000 predictions and got 941 of them right, that’s an accuracy rate of 94.1% (not bad!)

Both precision and recall are subtler variants of this same idea. The precision is the number of true positives (correct classifications) divided by the sum of true positives and false positives (incorrect positive classifications). It says, in effect, “When your model thought it had identified a needle in a haystack, this is how often it was correct.”

The recall is the number of true positives divided by the sum of true positives and false negatives (incorrect negative classifications). It says, in effect, “There were 200 needles in this haystack, and your model found 72% of them.”

Accuracy tells you how well your model performed overall, precision tells you how confident you can be in its positive classifications, and recall tells you how often it found the positive classifications.

Contact Us

How do I start with evaluating AI models and their performance?

Now, we arrive at the center of this article. Everything up to now has been background context that hopefully has given you a feel for how models are evaluated, because from here on out, it’s a bit more abstract.

Using reference text for evaluating generative models against training data

When we wanted to evaluate a regression model, we started by looking at how far its predictions were from actual data points.

Well, we do essentially the same thing with generative language models. To assess the quality of text generated by a model, we’ll compare it against high-quality text that’s been selected by domain experts.

The bilingual evaluation understudy (BLEU) score

The BLEU score can be used to actually quantify the distance between the generated and reference text. It does this by comparing the amount of overlap in the n-grams [1] between the two using a series of weighted precision scores.

The BLEU score varies from 0 to 1. A score of “0” indicates that there is no n-gram overlap between the generated and reference text, and the model’s output is considered to be of low quality. A score of “1”, conversely, indicates that there is total overlap between the generated and reference text, and the model’s output is considered to be of high quality.

Comparing BLEU scores across different sets of reference texts or different natural languages is so tricky that it’s considered best to avoid it altogether.

Also, be aware that the BLEU score contains a “brevity penalty” which discourages the model from being too concise. If the model’s output is too much shorter than the reference text, this counts as a strike against it.

The Recall-Oriented Understudy for Gisting Evaluation (ROGUE) Score

Like the BLEU score, the ROGUE score examines the n-gram overlap between an output text and a reference text. Unlike the BLEU score, however, it uses recall instead of precision.

There are three types of ROGUE scores:

  • rogue-n: Rogue-n is the most common type of ROGUE score, and it simply looks at n-gram overlap, as described above.
  • rogue-l: Rogue-l looks at the “Longest Common Subsequence” (LCS), or the longest chain of tokens that the reference and output text share. The longer the LCS, of course, the more the two have in common.
  • rogue-s: This is the least commonly-used variant of the ROGUE score, but it’s worth hearing about. Rogue-s concentrates on the “skip-grams” [2] that the two texts have in common. Rogue-s would count “He bought the house” and “He bought the blue house” as overlapping because they have the same words in the same order, despite the fact that the second sentence does have an additional adjective.

The Metric for Evaluation of Translation with Explicit Ordering (METEOR) Score

The METEOR Score takes the harmonic mean of the precision and recall scores for 1-gram overlap between the output and reference text. It puts more weight on recall than on precision, and it’s intended to address some of the deficiencies of the BLEU and ROGUE scores while maintaining a pretty close match to how expert humans assess the quality of model-generated output.

BERT Score

At this point, it may have occurred to you to wonder whether the BLEU and ROGUE scores are actually doing a good job of evaluating the performance of a generative language model. They look at exact n-gram overlaps, and most of the time, we don’t really care that the model’s output is exactly the same as the reference text – it needs to be at least as good, without having to be the same.

The BERT score is meant to address this concern through contextual embeddings. By looking at the embeddings behind the sentences and comparing those, the BERT score is able to see that “He quickly ate the treats” and “He rapidly consumed the goodies” are expressing basically the same idea, while both the BLEU and ROGUE scores would completely miss this.

How to choose the right evaluation metrics for your use case

Choosing the right evaluation metrics starts with understanding what your model is supposed to do and how its outputs will be used in practice. A model that predicts numerical values, such as sales forecasts, should be evaluated differently from one that classifies categories or generates text.

First, align metrics with your objective. For regression tasks, focus on how close your predicted and actual values are using metrics like MAE or RMSE. For classification, look at accuracy, average precision, and recall depending on whether false positives or false negatives matter more. For generative systems, combine automated scores with human review to judge quality and relevance.

Next, consider the quality and structure of your test data. Your evaluation results are only as reliable as the data you test on. Make sure it reflects real-world scenarios, edge cases, and variations your model will face after deployment.

You should also evaluate across multiple dimensions, not just a single score. A model may show strong model performance on average but fail in specific segments or edge cases. Looking at different metrics together gives a more balanced view of model predictions.

Finally, aim for a robust evaluation process that evolves over time. As your data changes and your model is updated, your evaluation approach should adapt as well. Regularly reviewing evaluation results helps catch performance drops early and ensures your model continues to meet expectations in real-world conditions.

Why AI Model Evaluation is Critical

Agentic AI is redefining how businesses operate – automating reasoning, decision-making, and task execution across fields like engineering and CX. But with that autonomy comes risk. Every AI agent must be carefully evaluated, monitored, and fine-tuned to ensure it performs reliably and aligns with your brand’s goals. Otherwise, even a small model error can compound into major consequences for your brand

If you’re enchanted by the potential of using agentic AI in your contact center but are daunted by the challenge of putting together an engineering team, reach out to us for a demo of the Quiq agentic AI platform. We can help you put this cutting-edge technology to work without having to worry about all the finer details and resourcing issues.

***

Footnotes

[1] An n-gram is just a sequence of characters, words, or entire sentences. A 1-gram is usually single words, a 2-gram is usually two words, etc. [2] Skip-grams are a rather involved subdomain of natural language processing. You can read more about them in this article, but frankly, most of it is irrelevant to this article. All you need to know is that the rogue-s score is set up to be less concerned with exact n-gram overlaps than the alternatives.

Frequently Asked Questions (FAQs)

What does AI model evaluation mean?

It’s how teams measure whether an AI system is performing as intended, accurate, fair, and ready for real-world use.

Why does AI model evaluation matter?

Evaluation exposes blind spots early and helps build confidence that the model can be trusted with customer-facing tasks.

How are generative models evaluated?

Metrics like BLEU, ROUGE, and BERT gauge quality, while human reviewers check tone, clarity, and usefulness.

Can metrics replace human judgment?

Not yet. Automated scores quantify performance, but humans still define what “good” sounds like.

How do I know if my model is ready?

When it performs consistently across test data, aligns with business goals, and earns trust through transparent evaluation.

AI Benchmarking Best Practices: A Framework for CX Leaders

Key Takeaways

  • Effective AI benchmarking converts your AI from a “black box” into a measurable asset – it helps prove value, spot gaps, and guide improvements.
  • Benchmark at multiple levels (internal, competitive, industry, and customer) using operational, customer-experience, financial, and AI metrics.
  • Key metrics include AI deflection/containment rate, average handle time (AHT) reduction, first-contact resolution (FCR), CSAT lift, cost-to-serve reduction, and ROI.
  • Benchmarking must be iterative: review and update metrics regularly, ground AI responses in real data, and guard against data inconsistency, bias, and hallucinations.

Is your AI investment delivering provable value, or is it still operating like a black box?

In today’s rapidly evolving customer experience (CX) landscape, where Artificial Intelligence (AI) promises transformative results, like decreasing service costs by up to 30% and yielding an average ROI of $1.41 for every dollar spent, simply implementing AI isn’t enough. You need to measure its impact. AI benchmarking holds the key.

Effective AI benchmarking is critical for evaluating progress, sustaining momentum, and refining your AI initiatives. By comparing performance internally and against industry standards, organizations ensure their strategies are competitive, effective, and aligned with evolving customer expectations. Robust benchmarking also builds credibility by quantifying success and providing a clear narrative for stakeholders. This is vital, as industry projections suggest AI could handle a significant majority of customer interactions, potentially between 70% (per Gartner) and 95% by 2025.

This article cuts through the complexity to deliver actionable AI benchmarking strategies specifically designed for CX professionals who need to demonstrate tangible results. Whether you’re just beginning your AI journey or looking to optimize existing implementations, you’ll learn how to develop an AI benchmarking framework aligned with your strategic goals. I’ll walk you through selecting the right metrics, establishing meaningful baselines, and creating a continuous improvement cycle that drives CX excellence. By the end, you’ll be equipped with practical tools to quantify AI’s impact, turning data into compelling narratives that secure stakeholder buy-in and position your organization as a CX leader. Let’s get started.

The Role of Benchmarking in Al-Driven CX

AI benchmarking goes beyond measuring outcomes; it establishes a clear context for performance. It highlights where AI initiatives deliver value and identifies gaps that require attention. In an era where AI investment is accelerating (98% of leaders plan to boost AI spending in 2025), benchmarking is vital for several reasons:

  • Identifying Best Practices: Learning from internal successes or external examples to guide future improvements.
  • Gaining Buy-In: Demonstrating progress and ROI with data-driven insights helps secure support from leadership and operational teams.
  • Driving Innovation: Comparing results against industry leaders inspires new strategies and reinforces a commitment to continuous improvement.

Understanding why AI benchmarking matters sets the stage. Now, let’s look at what top performance actually looks like in the current landscape.

What Good Looks Like in 2025

Based on current AI benchmarks and successful implementations, “good” Al-powered CX in 2025 isn’t just about isolated metrics. It’s about a holistic transformation that delivers significant, measurable value across the board. Here’s a snapshot:

Substantial Automation & Efficiency

Leading organizations achieve high AI Deflection Rates, with virtual agents fully resolving significant portions of inquiries without human intervention. Reported rates vary widely based on industry and use case, often ranging from 43% to over 75%.

This translates to significant reductions in Average Handle Time (AHT), sometimes resulting in 5x faster resolutions, and major Agent Productivity gains, often between 15-30%. Operational costs see marked decreases, potentially reaching the significant levels mentioned earlier.

Enhanced Customer Experience

Critically, efficiency gains do not come at the expense of satisfaction. Top performers maintain or even improve CSAT scores, often seeing lifts like Motel Rocks’ 9.44 point increase or Quiq clients like Accor achieving 89% CSAT. This is achieved through faster responses, 24/7 availability, increased personalization, and effective Human-Al Orchestration, ensuring empathy for complex issues. Improved First Contact Resolution (FCR) is key, with reductions in repeat contacts of 25-30% reported.

Tangible Business Outcomes & ROI

Success is measured in clear financial terms. Organizations demonstrate strong ROI, often reaching the average levels noted earlier, and achieve significant cost savings (Gartner projects $80 billion globally by 2026). Furthermore, Al is leveraged for revenue growth through Conversational Commerce, turning service interactions into sales opportunities, as seen with Klarna projecting $40M in additional profit, or Quiq clients attributing 10% of daily sales to chat.

Strategic & Integrated Approach

Excellence involves strategically deploying Al within asynchronous messaging channels (SMS, web chat, etc.) favored by customers. It requires robust Al Governance, seamless integration with existing systems, continuous iteration based on data, and commitment to agent training.

Leveraging Advanced, Accurate Al

Successful implementations increasingly use sophisticated conversational Al, often incorporating Large Language Models (LLMs) enhanced with techniques like Retrieval-Augmented Generation (RAG) for factual accuracy grounded in company knowledge. Agent-Assist tools are widely used to empower human agents.

“In essence, ‘good’ in 2025 means Al is deeply embedded, driving efficiency, enhancing customer satisfaction, delivering clear financial returns, and strategically positioning the organization for future innovation…” – Greg Dreyfus, Head of Solution Consulting at Quiq

Achieving this level of success requires a structured approach to measurement. Let’s look at the different ways you can benchmark your progress.

Types of AI Benchmarking

Internal Benchmarking

Focuses on comparing Al-driven performance within the organization to establish a baseline and track improvements over time.

  • Example: Compare resolution times and CSAT scores for Al versus human-handled inquiries.
  • Benefits: Highlights immediate wins, uncovers inefficiencies, and ensures alignment with goals.

Competitive Benchmarking

Involves comparing your organization’s metrics against direct competitors.

  • Example: Evaluate how your Al adoption impacts NPS or cost-per-interaction relative to others in your sector.
  • Benefits: Identifies competitive gaps or advantages, informs positioning strategies.

Industry Benchmarking

Assesses performance against general industry standards and best practices.

  • Example: Use analyst reports to compare your productivity gains (e.g., aiming for the 15-30% range) with sector leaders.
  • Benefits: Provides a macro view, uncovers broad trends for innovation.

Customer-Centric Benchmarking

Focuses on measuring outcomes that directly impact customer perceptions and loyalty.

  • Example: Compare Customer Effort Scores (CES) before and after implementing Al.
  • Benefits: Ensures CX initiatives genuinely improve the customer experience.

With these benchmarking types in mind, how do you build a practical framework for your organization?

Building an Al Benchmarking Framework

1. Establish Al Governance & Define Scope (Foundation)

Before deploying Al widely, create a clear Al Governance framework. Assemble a cross-functional team (CX, IT, Legal, Compliance) to define responsible usage policies, ethical guardrails, and risk protocols. Determine which metrics are most relevant to your goals and tie them to business outcomes like cost reduction, revenue growth, or retention.

2. Set Benchmarks at Multiple Levels

Establish benchmarks evaluating:

  • Operational Impact: FCR, Deflection Rate, AHT, Agent Productivity.
  • Customer Impact: CSAT, NPS, CES, Churn.
  • Financial Impact: ROI, Cost Savings, Revenue Influence.
  • AI Agent Mechanics: Evaluate core components like routing accuracy (did the right skill get called?), skill/tool correctness (did the skill/tool execute properly?).

3. Leverage Tools and Technology

Use appropriate tools to gather and analyze data efficiently. This includes:

  • Analytics Platforms: To track KPIs and visualize trends.
  • Customer Feedback Tools: For CSAT, NPS, CES surveys.
  • CX Automation Platforms (like Quiq): That often have built-in reporting and facilitate AI deployment, especially in asynchronous messaging channels.
  • Ensure robust integration with existing systems (CRMs, order management, etc…) to avoid data silos and enable personalized experiences.

4. Regularly Review and Update Benchmarks

Metrics and goals must evolve as AI capabilities mature. Schedule regular reviews (e.g., quarterly) to assess performance and adjust strategies. Stay current with industry reports, as benchmarks change rapidly.

Take our free AI readiness assessment to discover where you are on the AI maturity path.

Now that the framework is outlined, let’s dive deeper into the specific metrics you should be tracking, along with current industry benchmarks.

Key Metrics for Al Benchmarking in CX (with 2024-2025 Benchmarks)

Here are top metrics across key categories, updated with recent industry benchmarks:

1. Al Performance & Adoption Metrics

  • Al Deflection / Containment Rate: Percentage of inquiries handled or fully resolved by Al without human intervention.
    • Benchmark: Highly variable based on industry, use case complexity, and AI maturity.
      • Commonly reported rates range from 43% (e.g., Motel Rocks) up to 70-75% for specific sectors (e.g., AirAsia, some telcos).
      • For routine, high-volume tasks, AI may handle up to 80%.
      • Top-performing implementations can achieve even higher containment, such as Quiq client BODi® reporting 88%.
  • Self-Service Resolution Rate: Percentage of customer issues fully resolved via AI self-service without any human agent involvement.
    • Benchmark: Varies; examples include Sony at 15.9% and Quiq client Molekule achieving a 60% resolution rate for interactions handled via self-service AI. Industry average projections evolve (e.g., ~20% now, projected higher).
  • Agent Assist Utilization: Frequency agents leverage Al tools. Crucial for measuring adoption of augmentation tools.
  • Al Adoption / Interaction Handling: Percentage of total interactions involving Al.
    • Benchmark: Projected Al handling 70% (Gartner) to 95% of interactions by 2025.
  • Task Convergence / Reliability: Measures the consistency and predictability of the AI agent in completing a specific task within an expected number of steps or interactions. High convergence indicates a more reliable and less error-prone process.

2. Efficiency Metrics

  • Average Handle Time (AHT) Reduction: Decrease in average interaction time.
    • Benchmark: 25-30% range reported. Specifics: 27% (Agent Assist), 30% (Republic Services), 33-sec absolute drop (Camping World), 5x faster resolution (Klarna).
  • Agent Productivity Gain: Increase in agent efficiency (e.g., inquiries/hr).
    • Benchmark: Avg. 15-30% from GenAl. Agents using Al: +13.8% inquiries/hr. Camping World: +33% efficiency. Quiq client (National Furniture Retailer): 33% fewer escalations.
  • First-Response Time (FRT): Speed of initial reply. Al excels here for instant answers.
  • Escalation Rate: Percentage of Al interactions needing human help. Depending on the use case, lower is better however some use cases require human escalation.

3. Customer Experience Metrics

  • First-Contact Resolution (FCR): Percentage issues resolved on first interaction.
    • Benchmark: AI contributes significantly to improving FCR by reducing repeat contacts.
    • Examples of FCR Improvement: Klarna reported 25% fewer repeat inquiries (effectively a +25% FCR impact); Republic Services saw 30% fewer repeat calls.
    • Note: This differs from AI-specific resolution rates. For instance, while Quiq client Molekule achieved a 60% AI self-service resolution rate for the contacts handled by AI, the impact on overall FCR depends on the percentage of total contacts handled by AI.
  • CSAT Lift / Score: Change in customer satisfaction.
    • Benchmark: Often maintained or improved. Klarna: Parity with humans. Motel Rocks: +9.44 points. Any Al use: +22.3% lift avg. Quiq Clients: Accor (89%), BODi® (75%), Molekule (+42% lift).
  • Customer Effort Score (CES): Measures ease of resolution. Lower effort = higher loyalty.
  • Net Promoter Score (NPS): Likelihood to recommend.

4. Financial Metrics

  • Cost Per Contact / Cost-to-Serve Reduction: Decrease in interaction handling cost.
    • Benchmark: Reductions align with AI’s potential for significant operational savings, potentially reaching up to the 30% mark mentioned previously. Gartner projects $80B projected savings globally by 2026.
  • Return on Investment (ROI): Financial return from Al investment.
    • Benchmark: As highlighted earlier, the average ROI often reaches $1.41 per $1 spent, with 92% of early adopters seeing positive ROI.
  • Revenue Influence / Conversational Commerce: Added revenue via Al assistance.
    • Benchmark: Klarna: Projected +$40M profit. Retailers: 5-15% conversion lift. H&M: Higher AOV. Quiq clients: Accor (2x booking click-outs), National Furniture Retailer (10% daily sales via chat).

5. Operational Metrics

  • Error Reduction Rate: Decrease in mistakes vs. manual processes.
  • Training Time Reduction: Faster onboarding with Al tools.
  • Knowledge Creation Efficiency: Speed of turning interactions into reusable knowledge.

While these results are impressive, achieving them requires navigating potential pitfalls. Let’s examine the common challenges.

Common Challenges in Al Benchmarking and How to Overcome Them

While the benefits are clear, organizations face hurdles:

1. Accuracy and “Hallucinations”

  • Challenge: Generative Al can sometimes produce incorrect answers.
  • Solution: Implement RAG to ground Al responses in verified knowledge; use hybrid approaches; ensure human oversight.

2. Lack of Consistent Data

  • Challenge: Comparing performance requires standardized data collection.
  • Solution: Develop uniform data practices; use centralized dashboards; ensure robust integration with existing systems (CRM, etc.).

3. Bias and Fairness

  • Challenge: Al models can perpetuate biases.
  • Solution: Use diverse training data; continuously monitor outputs via observability (clear box); establish clear ethical guidelines; ensure human oversight.

4. Data Privacy and Security

  • Challenge: Al often needs sensitive data, increasing risks.
  • Solution: Ensure strict compliance (GDPR, CCPA); anonymize data; vet vendors; work with legal teams.

5. Benchmarking in a Rapidly Changing Landscape

  • Challenge: Benchmarks quickly become outdated.
  • Solution: Stay connected with analyst reports; update benchmarks regularly; focus on continuous improvement relative to your baseline.

6. Balancing Internal and External Comparisons

  • Challenge: Internal focus may miss competitive shifts.
  • Solution: Use internal benchmarks for initial wins; incorporate external insights as Al matures.

7. Change Management & Skills Gap

  • Challenge: Implementing Al requires organizational change and new skills.
  • Solution: Communicate clearly; invest in agent training/upskilling (empathy, complex problem-solving); position Al as augmentation; address job fears proactively.

8. Evaluating Multimodal Interactions:

  • Challenge: Benchmarking AI that handles complex interactions involving voice, visuals, or other modalities requires specific metrics and approaches beyond text-based analysis (e.g., audio chunk analysis for voice agents).
  • Solution: Develop modality-specific evaluation criteria; ensure benchmarking tools can capture and analyze multimodal data; maintain focus on the overall user experience across modalities.

Continuous Improvement and Outcome-Based Optimization

Benchmarking is not a static report card; it’s a dynamic tool for driving ongoing refinement. Furthermore, consistent evaluation at multiple levels serves as a crucial diagnostic tool, enabling teams to more effectively debug issues and pinpoint root causes when performance deviates from expectations. Organizations must move beyond measurement to action. This involves:

  • Regularly analyzing gaps between current performance and benchmarks.
  • Establishing feedback loops: Use analytics, customer surveys, and agent input.
  • Iterating continuously: Use insights to update AI training, rules, and workflows. Treat AI as a product that requires ongoing improvement.
  • Focusing on outcomes: Evolve measurement beyond operational metrics to track key business outcomes (CSAT, LTV, retention, revenue).
  • Engaging cross-functional teams (including an AI governance team) to implement changes and oversee evolution.

Strategic Recommendations for CX Leaders

Based on 2024-2025 trends and AI benchmarks, consider these strategic steps:

  1. Prioritize Asynchronous Messaging Channels (0-6 Months Start): Embrace channels like web chat, SMS, WhatsApp, etc., where customers prefer to interact and Al integrates effectively. [Impacts: CSAT, Agent Productivity, Deflection Rate]. Quiq specializes in optimizing these channels.
  2. Implement Al Agent Deflection for Tier-1 (0-6 Months Start): Focus Al automation on high-volume, low-complexity inquiries first to achieve quick ROI and free up human agents. [Impacts: Deflection Rate, Cost Per Contact, AHT].
  3. Leverage Agent-Assist Tools (6-12 Months+): Augment human agents with Al suggestions, knowledge surfacing, and task automation. [Impacts: AHT, Agent Productivity, FCR, Training Time].
  4. Master Human-Al Orchestration (Ongoing): Design seamless handoffs between Al and humans, ensuring context is preserved. Define clear escalation rules. [Impacts: CSAT, FCR, Agent/Customer Experience]. Quiq’s platform excels at this.
  5. Invest in Data Integration & Agent Training (Ongoing): Break down data silos for a unified customer view. Upskill agents for complex issues and Al collaboration. [Impacts: Personalization, Agent Effectiveness, CSAT].
  6. Explore Conversational Commerce Responsibly (Ongoing): Use Al to offer relevant recommendations during service interactions, prioritizing problem-solving first. Track conversion and sentiment carefully. [Impacts: Revenue Influence, AOV, CSAT (if done well)]. Quiq supports this blend.
  7. Stay Ahead of Technology (Ongoing): Keep an eye on advancements like RAG for accuracy and Agentic Al for future autonomous task handling. [Impacts: Future-proofing, Accuracy, Advanced Automation].

The Path Forward

Implementing robust AI benchmarking is about embedding a culture of data-driven decision-making and continuous improvement within your CX organization. By setting clear goals, leveraging the right metrics, learning from both internal and external examples, and strategically applying AI through platforms designed for effective orchestration like Quiq, CX leaders can move beyond the hype.

You can demonstrate significant value, enhance customer loyalty, contain costs, and ultimately, drive tangible business results in the evolving landscape of AI-powered customer experience. The time to measure, refine, and prove the impact of your AI strategy is now.

Frequently Asked Questions (FAQs)

What is AI benchmarking?

AI benchmarking is the process of measuring your AI system’s performance against internal goals, industry standards, or competitors. It helps you understand how well your AI is performing and where to improve.

Why is AI benchmarking important?

Benchmarking ensures your AI investments deliver measurable value. It identifies performance gaps, validates ROI, and guides optimization efforts to improve efficiency, accuracy, and customer experience.

What metrics are used to benchmark AI performance?

Common AI benchmarking metrics include deflection rate, containment rate, first-contact resolution (FCR), average handle time (AHT) reduction, customer satisfaction (CSAT) lift, and cost-to-serve improvements.

How often should AI performance be benchmarked?

AI performance should be reviewed regularly to capture changes in customer behavior, technology updates, or new business priorities.

What are the biggest mistakes to avoid when benchmarking AI?

The most common mistakes include using inconsistent data, ignoring bias or hallucinations in AI responses, and failing to adjust benchmarks as systems evolve.

How does AI benchmarking improve ROI?

By tracking operational and customer-experience metrics, benchmarking shows how AI contributes to faster resolutions, lower costs, and better customer satisfaction – directly tying performance to ROI.

What’s the difference between internal and external benchmarking?

Internal benchmarking compares performance over time within your organization, while external benchmarking measures your results against competitors or industry leaders.


Citations List

  1. “61 AI Customer Service Statistics in 2025.” Desk365.
  2. “Snowflake Research Reveals that 92% of Early Adopters See ROI from AI Investments.” Snowflake.
  3. “Generative AI in Customer Experience: Real Impact, Key Risks, and What’s Next.” Conectys.
  4. “Future of AI in Customer Service: Its Impact beyond 2025.” DevRev.
  5. “Call Center Reporting: Your Definitive Guide (2025).” CloudTalk. 
  6. “Elevating Customer Support in Healthcare.” Alvarez & Marsal.
  7. “Call Center Performance Metrics Examples for Success.” Call Criteria. 
  8. “Key Benchmarks Should You Target In 2025 for your Contact Center.” NobelBiz. 
  9. “10 Call Center Metrics to Track in 2025.” Call Criteria. https://callcriteria.com/call-center-metrics-2/
  10. “What Call Center Benchmarks Should You Target In 2025?” Nextiva. 
  11. “AI in Customer Service Statistics [January 2025].” Master of Code.
  12. “Superagency in the workplace: Empowering people to unlock AI’s full potential.” McKinsey.
  13. “5 AI Case Studies in Customer Service and Support.” VKTR.
  14. “The Evolving Role of AI in Customer Experience: Insights from Metrigy’s 2024-25 Study.” Metrigy.
  15. “Customer experience trends 2025: 6 analysts share their predictions.” CX Dive.
  16. “AI in Customer Service Market Report 2025-2030.” GlobeNewswire.
  17. “5 AI in CX trends for 2025.” CX Network.
  18. “How organizations are leveraging Generative AI to transform marketing.” Consultancy-ME.
  19. “IT and Technology Spending & Budgets for 2025: Trends & Forecasts.” Splunk.
  20. “How AI is elevating CX for financial services firms in 2025 and beyond.” CallMiner.
  21. “The Top 14 SaaS Trends Shaping the Future of Business in 2025.” Salesmate.
  22. “Real-world gen AI use cases from the world’s leading organizations.” Google Cloud Blog.
  23. “Phocuswright’s Travel Innovation and Technology Trends 2025.” Phocuswright.
  24. “50+ Eye-Popping Artificial Intelligence Statistics [2025].” Invoca.
  25. “51 Latest Call Center Statistics with Sources for 2025.” Enthu AI.
  26. “Artificial Intelligence Archives.” FutureCIO.
  27. “NLP vs LLM: Key Differences, Applications & Use Cases.” Openxcell.
  28. “LLM vs NLP: Understanding The Top Differences in 2025.” CMARIX.
  29. “Compare Lunary vs. Private LLM in 2025.” Slashdot.
  30. “Five Trends in AI and Data Science for 2025.” MIT Sloan Management Review.
  31. “Five Trends in AI and Data Science for 2025 From MIT Sloan Management Review.” PR Newswire.
  32. “5 Tech Trends to Watch in 2025.” Comcast Business.
  33. “Top 2025 Trends in Customer Service.” Computer Talk.
  34. “AI Governance Market Research 2025 – Global Forecast to 2029.” GlobeNewswire.
  35. “The state of AI: How organizations are rewiring to capture value.” McKinsey.
  36. “The 2025 CX Leaders Trends & Insights: Corporate Edition Report.” Execs In The Know. 
  37. “Predictions 2025: Tech Leaders Chase High Performance.” Forrester.
  38. “Management Leadership Archives.” FutureCIO.
  39. “Explore Gartner’s Top 10 Strategic Technology Trends for 2025.” Gartner.
  40. “Leadership and AI insights for 2025.” NC State MEM.
  41. “Tackling the Challenges and Opportunities of Generative AI in Financial Services.” Spring Labs.

Unlock Agent Potential with Quiq’s Real-Time Agent Assist Capabilities

Customer service is evolving, and with it, the demands placed on service agents are rapidly increasing. From managing complex inquiries to delivering personalized, high-quality customer experiences, agents are under constant pressure to perform at their best. This is where Quiq’s Real-Time Agent Assist comes into play. With AI-driven insights, real-time guidance, and cutting-edge automation, this powerful tool doesn’t just support agents—it transforms them into top performers.

In this blog, we’ll explore precisely how Quiq’s real-time agent assist capabilities—part of our overall AI contact center offering—can revolutionize your customer service operations by boosting efficiency, reducing costs, and delighting customers.

Transform agent productivity with real-time AI insights

Agents are at the heart of your customer interactions, and giving them the tools they need to succeed can make all the difference. Quiq’s real-time agent assist AI is designed to empower agents with in-the-moment guidance and actionable insights during live interactions. These agent tools mean faster resolutions, greater confidence, and improved productivity for your team.

With Quiq, agents no longer have to second-guess their responses or scramble to find the right information. Instead, AI steps in to provide precise recommendations and cues at just the right time.

Take action today
Experience the future of customer service firsthand. Get a demo of Quiq’s real-time agent assist offering today and see how it can transform your support team.

AI-powered efficiency for every role, every conversation

Whether it’s advising agents on complex issues, streamlining onboarding, or cutting operational costs, Quiq’s real-time agent assist offering delivers impactful benefits across the board.

Here’s how it works for your business:

1. Optimize decision-making

Equip your agents with real-time insights and recommended actions, enabling them to resolve issues with precision. Whether handling a challenging customer inquiry or upselling products,

Quiq ensures that agents make the best decisions in every interaction. Agents get real-time suggested responses as the conversation progresses, which leverage the same underlying knowledge and systems that power AI agents. Think: knowledge bases, product catalogs, CRM data, and any other data sources that might be helpful in the context of agentic AI systems. AI Assistants don’t just suggest responses; they can also act on an agent’s behalf—like automatically starting a warranty claim, or updating a customer’s flight, without making the agent do the work manually.

2. Streamline training and onboarding

AI-powered coaching is a game changer for new agents. With Quiq, your team gains access to on-the-job guidance that accelerates learning. New hires ramp up faster, while experienced agents refine their skills, creating a consistently high-performing team. New agents get the same great suggested responses and actions that a high-performing human or AI agent would have.

It makes a brand-new agent as good as an AI agent, because they’re working off the same datasets, integrations and responses.

3. Reduce operational costs

Achieve more with fewer resources. Quiq automates routine inquiries and streamlines workflows, freeing up your agents to focus on high-value interactions. This means fewer hiring needs and a leaner operational model. In addition, AI Assistants can gather extra key pieces of data during a conversation, add them to specific ticket fields or append them to a case or conversation, reducing the amount of manual entry an agent has to do.

4. Enhance customer satisfaction

Quiq’s agent-facing AI empowers agents to provide accurate, instant, and personalized support, leading to faster resolutions and happier customers. The result? Higher CSAT scores and stronger customer loyalty. This is done through a combination of response suggestions, real time feedback, and taking action on the agent’s behalf.

5. Insights into agent performance

Quiq’s robust agent analytics give contact center leaders deep insight into how human agents are performing. In our experience, this is critical to ensuring that real-time agent assistance does its job and helps agents in the most effective way possible.

Watch this video to learn how it works >

Key features of real-time agent assist with Quiq

At the core of Quiq’s real-time agent assist lies a suite of innovative features designed for seamless customer interactions. See it in action:

1. In-the-moment guidance and coaching

Built in Quiq’s AI Studio, AI assistants can leverage data from any enterprise system and combine that with conversational context to suggest responses and provide recommendations, or coaching, during a conversation. Agents thrive with support that adapts in real time. Quiq provides targeted coaching during live conversations, using AI to deliver hints, reminders, and workflows tailored to each interaction.

For instance, in a case study with an office supply retailer, Quiq’s assist feature was so effective it allowed associates to get immediate answers to questions 2 out of 3 times. This led to a whopping 68% self-service rate resolution rate.

2. Automated post-conversation summary and analysis

After-conversation work can be a major time sink—but not with Quiq. Using AI-generated summaries, agents can cut down on post-interaction tasks, allowing them to focus on the next customer. Customers get faster service, and agents stay productive.

Importantly, summaries are also available for the agent right when they take over a conversation. For example, if the user has been talking with an AI agent, the human agent will get a summary of the conversation, creating a seamless experience for the end customer.

Beyond summarization, Quiq can also extract key pieces of information and automatically update CRMs or other enterprise systems with the appropriate information.

3. Smart routing and prioritization

Not all customer inquiries are created equal. Quiq’s intelligent routing ensures that inquiries are directed to the best-suited agents based on real-time data like expertise, workload, or customer urgency. This minimizes wait times and optimizes outcomes.

Real results with AI assistants: Office supplier case study

When a leading office supply retailer integrated Quiq’s agent-facing AI Assistant, they saw impressive improvements in just a few weeks.

  • Increase in containment rates: 35% (with a 6-month average containment rate of 65%)
  • Associates got immediate answers: 2 out of 3 times
  • Self-service resolution rate: 68%
  • Associate satisfaction with AI: 4.82 out of 5

The AI ensured that each employee was guided toward resolving customer issues promptly while automating laborious and repetitive inquiries. This created a win-win for both customers and the team itself. Read full case study >

Elevate customer support with Quiq’s real-time agent assist offering

Imagine a team where every agent operates at their peak potential, guided by AI that backs their every move. Quiq’s real-time agent assist isn’t just an upgrade for your service department—it’s a revolution that touches every part of your customer experience.

If you’re ready to unlock your agents’ potential and take your customer service to the next level, now is the time to act.

What is NLP Preprocessing? Top 12 Techniques

Along with computer vision, natural language processing (NLP) is one of the great triumphs of modern machine learning. While ChatGPT is all the rage and large language models (LLMs) are drawing everyone’s attention, that doesn’t mean that the rest of the NLP field just goes away.

NLP endeavors to apply computation to human-generated language, whether that be the spoken word or text existing in places like Wikipedia. There are a number of ways in which this would be relevant to customer experience and service leaders, including:

  • Using it to power customer-facing AI agents
  • Creating question-answering systems
  • Classifying sentiment from e.g., customer reviews
  • Automatically transcribing client calls

Today, we’re going to briefly touch on what NLP is, but we’ll spend the bulk of our time discussing how textual training data can be preprocessed to get the most out of an NLP system. There are a few branches of NLP, like speech synthesis and text-to-speech recognition, which we’ll be omitting.

Armed with this context, you’ll be better prepared to evaluate using NLP in your business (though if you’re building customer-facing AI agents, you can also let the Quiq platform do the heavy lifting for you).

What is Natural Language Processing (NLP)?

In the past, we’ve jokingly referred to NLP as “doing computer stuff with words after you’ve tricked them into being math.” This is meant to be humorous, but it does capture the basic essence.

Remember, your computer doesn’t know what words are; all it does is move 1’s and 0’s around. A crucial step in most NLP applications, therefore, is creating a numerical representation out of the words in your training corpus.

There are many ways of doing this, but today, a popular method is using word vector embeddings. Also known simply as “embeddings”, these are vectors of real numbers. They come from a neural network or a statistical algorithm like word2vec and stand in for particular words.

The technical details of this process don’t concern us in this post, what’s important is that you end up with vectors that capture a remarkable amount of semantic meaning. Words with similar meanings also have similar vectors, for example, so you can do things like find synonyms for a word by finding vectors that are mathematically close to it.

These embeddings are the basic data structures used across most of NLP. They power sentiment analysis, topic modeling, and many other applications.

For most projects, it’s enough to use pre-existing word vector embeddings without going through the trouble of generating them yourself.

Are large language models natural language processing?

Large language models (LLMs) are a subset of natural language processing. Training an LLM draws on many of the same techniques and best practices as the rest of NLP, but NLP also addresses a wide variety of other language-based tasks.

Conversational AI is a great case in point. One way of building a conversational agent is by hooking your application up to an LLM like ChatGPT, but you can also do it with a rules-based approach, through grounded learning, or with an ensemble that weaves together several methods.

Data preprocessing for NLP

If you’ve ever sent a well-meaning text that was misinterpreted, you know that language is messy. For this reason, NLP places special demands on the data engineers and data scientists who must transform text in various ways before machine learning models can be trained on it. With higher data quality comes improved model performance.

In the next few sections, we’ll offer a fairly comprehensive overview of data preprocessing for NLP. This will not cover everything you might encounter in the course of preparing data for your NLP application, but it should be more than enough to get started.

Why is text data preprocessing important?

They say that data is the new oil, and just as you can’t put oil directly in your gas tank and expect your car to run, you can’t plow a bunch of garbled, poorly-formatted language data into your algorithms and expect magic to come out the other side.

But what, precisely, counts as text preprocessing will depend on your goals. You might choose to omit or include emojis, for example, depending on whether you’re training a model to summarize academic papers or write tweets for you.

That having been said, there are certain steps you can almost always expect to take, including standardizing the case of your language data, removing punctuation, white spaces, and stop words, segmenting and tokenizing, etc.

Top text preprocessing techniques to make unstructured text data usable

NLP preprocessing techniques are the steps used to clean and prepare raw text before it is analyzed by a Natural Language Processing model. Raw text data contains noise such as punctuation, inconsistent casing, spelling variations, and irrelevant information. Preprocessing transforms that text into a structured format that machines can understand, analyze and finally generate human language themselves.

Here are the most common NLP preprocessing steps and techniques.

1. Segmentation and tokenization

An NLP model is always trained on some consistent chunk of the full data. When ChatGPT was trained, for example, they didn’t put the entire internet in a big truck and back it up to a server farm, they used self-supervised learning.

Simplifying greatly, this means that the underlying algorithm would take, say, the first few sentences of a paragraph and then try to predict the remaining sentence on the basis of the text that came before. Over time it sees enough language to guess that “to be or not to be, that is ___ ________” ends with “the question.”

But how was ChatGPT shown the first three sentences? How does that process even work?

A big part of the answer is segmentation and tokenization.

With segmentation, we’re breaking a full corpus of training text – which might contain hundreds of books and millions of words – down into units like words or sentences.

This is far from trivial. In the English language, sentences end with a period, but words like “Mr.” and “etc.” also contain them. It can be a real challenge to divide text into sentences without also breaking “Mr. Smith is cooking the steak” into “Mr.” and “Smith is cooking the steak.”

Tokenization is a related process of breaking a corpus down into tokens. Tokens are sometimes described as words, but in truth, they can be words, short clusters of a few words, sub-words, or even individual characters.

This matters a lot to the training of your NLP model. You could train a generative language model to predict the next sentence based on the preceding sentences, the next word based on the preceding words, or the next character based on the preceding characters.

Regardless, in both segmentation and tokenization, you’re decomposing a whole bunch of text down into individual units that your algorithm can work with.

2. Lowercasing

Lowercasing is the text preprocessing technique of converting all text to lowercase before it is processed by an NLP model.

Human language is not consistent about capitalization. The same word may appear as “Apple,” “APPLE,” or “apple,” depending on whether it starts a sentence, refers to a company, or is simply written in a different style.

For an NLP model, these variations can create unnecessary complexity. If capitalization is left untouched, the model may treat each version as a completely different token. That means “Apple,” “apple,” and “APPLE” could all end up as separate entries in the vocabulary.

Lowercasing reduces this variation. Instead of learning three separate representations for “Apple,” “apple,” and “APPLE,” the model only needs to learn one.

There is a tradeoff here. In some cases, capitalization carries meaning. “Apple” might refer to the company, while “apple” refers to the fruit. If everything is converted to lowercase, that distinction disappears.

Because of that, some NLP systems keep capitalization intact when the task requires it, such as named entity recognition. But for many applications, especially those focused on general language patterns, lowercasing is a useful step that reduces noise and helps the model learn more efficiently.

3. Stop word removal

Stop word removal is the preprocessing technique of removing very common words that appear frequently in language but often contribute little meaning to the text.

Words such as “the,” “is,” “and,” “of,” and “in” appear extremely often in English. These are known as stop words.

Imagine a sentence like this:

“The product is available in the store and on the website.”

If the goal is to understand the main topic of the sentence, the most important words are probably “product,” “available,” “store,” and “website.” The rest mainly help the grammar of the sentence.

Removing stop words reduces noise in the dataset. If every document contains the same handful of extremely common words, those words do not help much in distinguishing one piece of text from another.

For some tasks, such as search engines or topic modeling, removing stop words helps models focus on the words that actually describe the subject of a document.

However, stop word removal is not always appropriate. In tasks such as sentiment analysis or conversational AI, even small words can carry meaning. The difference between “I like this” and “I do not like this” depends on a single word.

Because of that, whether stop words should be removed depends heavily on the goal of the NLP system.

4. Stemming

Stemming is the preprocessing technique of reducing words to a simplified root form by removing prefixes or suffixes.

Human language often expresses the same concept through multiple word forms. Words such as “run,” “running,” “runs,” and “ran” all refer to the same basic action, but they appear differently in text.

Without preprocessing, an NLP model may treat each of these forms as completely separate tokens.

Stemming attempts to solve this by trimming words down to a shared base or root form.

For example:

running → run
played → play
studies → studi

That final example of a base form or stem word shows an important limitation. The resulting word is not always a real dictionary term. Stemming relies on simple rules that remove common endings rather than a deep understanding of language, and it may not always lead to improving data quality.

Even with that limitation, stemming can be useful because it reduces vocabulary size and helps the model connect related words during training.

For applications such as search engines or document retrieval systems, this kind of simplification is often good enough.

5. Lemmatization

Lemmatization is the preprocessing technique of reducing words to their true base or dictionary form, known as the lemma.

Like stemming, lemmatization attempts to connect different word forms that share the same meaning. However, instead of simply trimming suffixes, it relies on vocabulary resources and grammatical analysis.

For example:

running → run
better → good
studies → study

Unlike stemming, the result is usually a valid word found in a dictionary.

To determine the correct lemma, the system often needs to understand the grammatical role of the word in a sentence. For instance, the word “saw” could be the past tense of “see,” or it could refer to a cutting tool. The correct interpretation depends on context.

Because this process requires linguistic knowledge and sometimes part-of-speech tagging, lemmatization is typically more computationally expensive than stemming.

However, it also produces cleaner and more accurate representations of language, which makes it useful in applications where preserving meaning is important.

6. Removing punctuation and special characters

Removing punctuation and special characters is the preprocessing technique of eliminating symbols such as commas, quotation marks, parentheses, and other non-alphabetic characters from text.

Natural text contains many formatting elements that help human readers understand structure or tone. Punctuation marks, emojis, and special symbols all play a role in written communication.

However, in many NLP tasks, these characters do not contribute much to the core meaning of the text.

For example:

“Hello!!! How are you?”

A preprocessing pipeline might convert this to something simpler:

“Hello how are you”

Removing punctuation helps standardize the input data and reduces noise in the training corpus.

That said, punctuation can sometimes carry useful signals. In sentiment text analysis, repeated exclamation marks may indicate excitement or emphasis.

Because of this, some NLP systems remove punctuation entirely, while others keep specific characters that might contain meaningful information.

The goal is always the same. Clean the text enough that the model can focus on meaningful patterns instead of being distracted by formatting variations.

7. Text normalization

Text normalization is the preprocessing technique of converting text into a consistent and standardized form before it is analyzed by an NLP model.

Natural language contains many variations that refer to the same thing. People use abbreviations, contractions, spelling variants, and informal expressions all the time. If these differences are left untouched, the model may treat them as unrelated tokens.

Normalization reduces this variation by converting different forms into a common representation.

For example:

don’t → do not
can’t → cannot
USA → United States

Normalization may also include spelling corrections, standardizing numbers, or expanding abbreviations.

Consider a dataset containing the words “color” and “colour.” Without normalization, the model treats them as separate tokens even though they represent the same concept.

By standardizing these variations, normalization makes the training data more consistent and easier for the model to learn from. Proper text preprocessing can mean eliminating misspelled words, but also deciding on which version of a spelling is correct for your use case.

The exact normalization rules depend heavily on the application. Informal chat messages, for example, may require normalization of slang and abbreviations that would never appear in formal documents. In those cases, preparing text data is crucial as it impacts data quality.

8. Removing numbers

Removing numbers is the preprocessing technique of eliminating numeric values from text when they do not contribute meaningful information to the task.

Many text datasets contain numbers that may not help the model understand the underlying meaning of the text.

For example:

“The product costs $49 and was released in 2024.”

If the goal is topic classification or general language modeling, the numbers themselves may not add much value. In such cases, they can simply be removed.

After preprocessing, the sentence might look like this:

“The product costs and was released in”

Of course, this technique must be used carefully. In some applications, numbers carry extremely important information. Financial analysis, medical data, and scientific documents often rely heavily on numerical values.

Because of this, many NLP pipelines only remove numbers when they are clearly irrelevant to the problem being solved.

The general idea is to simplify the dataset and reduce unnecessary variation in the vocabulary.

9. Part of speech tagging

Part-of-speech tagging (also called grammatical tagging) is the preprocessing technique of assigning grammatical labels to each word in a sentence.

In English, words can function as nouns, verbs, adjectives, adverbs, and other grammatical categories. Identifying these roles helps an NLP system understand how words relate to each other.

For example:

“The dog runs quickly.”

A part-of-speech tagger might label the words like this:

The → determiner
dog → noun
runs → verb
quickly → adverb

These tags give the model information about the structure of the sentence.

Part-of-speech tagging is often used as an intermediate step in more advanced NLP tasks. Named entity recognition, dependency parsing, and information extraction all rely on grammatical structure to interpret meaning.

Although modern deep learning models sometimes learn this structure automatically, explicit POS tagging is still widely used in traditional NLP pipelines.

10. Named entity recognition preprocessing

Named entity recognition, often abbreviated as NER, is the preprocessing technique of identifying and labeling specific real-world entities within text.

Human language frequently refers to people, organizations, locations, dates, and other identifiable entities. Recognizing these elements helps NLP solutions extract useful information from text.

For example:

“Apple released a new iPhone in California in 2023.”

An NER system might identify the entities as:

Apple → organization
iPhone → product
California → location
2023 → date

This allows the model to distinguish between general words and references to real-world objects or institutions.

Named entity recognition is widely used in applications such as news analysis, text classification, knowledge extraction, and search engines.

By identifying these entities early in the preprocessing pipeline, NLP systems can build richer representations of the information contained in text.

11. Noise removal

Noise removal is the text preprocessing technique of eliminating irrelevant or distracting elements from text that do not contribute to the meaning of the content.

Real-world text data rarely comes in a clean form. It may contain HTML tags, URLs, emojis, repeated characters, formatting artifacts, or other elements that are useful for humans but confusing for NLP models.

For example, a sentence taken from a webpage might look like this:

“Check out our new product!!! 👉 https://example.com <br> Limited time offer!!!”

Before an NLP model processes the text, a preprocessing pipeline might remove the URL, HTML tags, and extra punctuation so that the remaining text is easier to analyze.

After removing HTML tags and other noise, the sentence might look like this:

“Check out our new product limited time offer”

Removing this kind of noise helps reduce unnecessary variation in the dataset and makes it easier for the model to identify meaningful patterns in the language.

The exact definition of “noise” depends on the application. In social media posts, for example, emojis may actually carry useful sentiment information and might be preserved rather than removed because they contribute as much value as individual words.

The goal of noise removal is simply to eliminate elements that distract from the linguistic structure of the text.

12. Vectorization and feature extraction

Vectorization and feature extraction are text preprocessing techniques that convert text into numerical representations that machine learning models can process.

Computers cannot directly understand words or sentences. Instead, text must be translated into numbers that represent patterns in the language.

One of the simplest approaches is the bag of words model, where a document is represented by counting how often each word appears.

For example, consider two short sentences:

“I like coffee”
“I like tea”

A bag-of-words representation might convert these into numerical vectors based on the frequency of each word in the vocabulary.

Another widely used technique is TF IDF, which stands for term frequency inverse document frequency. Instead of simply counting words, TF IDF gives higher importance to words that appear frequently in a document but not across every document in the dataset.

More advanced NLP systems use word embeddings, which represent words as vectors in a high-dimensional space. In this space, words with similar meanings appear closer together.

For instance, the vectors representing “king” and “queen” would be closer to each other than the vectors for “king” and “table.”

These numerical representations allow machine learning models to analyze patterns, relationships, and meaning within large collections of text.

Vectorization is often the final step of text preprocessing before the text is fed into an NLP algorithm or neural network.

Supercharging your NLP applications

Natural language processing is an enormously powerful constellation of techniques that allow computers to do worthwhile work on textual data. It can be used to build question-answering systems, tutors, chatbots, and much more.

But to get the most out of it, you’ll need to preprocess the data. No matter how much computing you have access to, machine learning isn’t of much use with bad data. Techniques like removing stopwords, expanding contractions, and lemmatization create a corpora of text that can then be fed to NLP algorithms. Of course, there’s always an easier way. If you’d rather skip straight to the part where cutting-edge conversational AI directly adds value to your business, you can also reach out to see what the Quiq platform can do.

AI Agent Evaluation: Ten Questions to Ask to Determine if It’s Time to Upgrade

Key Takeaways

  • A capable AI agent should interpret multi-part questions and provide a single, cohesive answer rather than treating each part separately.
  • AI agents should remember previous turns, handle follow-ups naturally, and resume earlier topics without losing track.
  • The best AI agents connect with backend systems (CRM, order data, account info) to take action, not just provide static replies.
  • A reliable agent avoids hallucinations by escalating or deferring when unsure instead of guessing.
  • When escalation is needed, the agent should pass the full context so the customer doesn’t have to repeat themselves.

Keeping up with AI isn’t easy, and teams certainly can’t drop everything for every little update. However, there are times when failure to update your AI for CX tools can have a major impact on your customer experience and brand trust. And the rise of agentic AI is one of those times.

Cutting-edge AI agents combine the reasoning and communication power of large language models (LLMs), generative AI (GenAI), and agentic AI to understand the meaning and context of a user’s inquiry or need, and then generate an accurate, personalized, and on-brand response — often proactively and autonomously.

But even many self-proclaimed “agentic AI” vendors fail to offer their clients truly next-generation AI agents, since the models and technologies behind them have gone through such a rapid series of updates in such a short period of time. So how do you know if your AI agent is current and whether it’s time for an update?

That’s where this AI agent evaluation comes in. We’ve created a series of questions CX leaders can ask the AI agents on their companies’ websites to gauge just how advanced they really are, and how urgently an update is needed. Already considering a new agentic AI platform? Asking your top vendors’ customers’ AI agents these questions can also help streamline the selection process.

Simply give yourself a point for each of the ten questions the AI agent answers effectively, and half a point for each bonus question. Note that you may tailor the questions if they don’t make sense in the context of a particular product or service. Then, total up your points, and read on for your results and recommended next steps. Are you ready?

Question #1: “What is your return policy and do you offer exchanges?”

Add a Point If…

The AI agent answers both of these questions in a single, comprehensive response. Ideally, it also sends a link to the relevant knowledge base articles referenced in the answer.

Question #1

No Points If…

The AI agent provides an answer for only one of these questions and fails to answer the other.

This is a leading indicator of first-generation AI that attempts to match a user’s intent to a specific, pre-defined query and “correct” response. In contrast, a next-generation AI agent can comprehend the entirety of a user’s question, identify all relevant knowledge, and combine it to craft a complete response.

Question #2: “Do you offer financing? How do I qualify?”

Add a Point If…

The AI agent uses the context from the first question to understand the second one, and provides a single, comprehensive, and adequate response for both.

No Points If…

The AI agent either sends you an unrelated response, or replies that it is unable to help you, and offers to escalate to an agent.

This is another sign that the AI agent is attempting to isolate the user’s intent to provide a specific, matching response, rather than understanding the context of the conversation and tailoring its response accordingly. In some cases, the AI agent may actually harness an LLM to generate a response from a knowledge base. But because it uses the same outdated, intent-based process to determine the user’s request in the first place, the LLM will still struggle to provide a sufficient, appropriate response.

Question #3: “Can you help me track my order?”

Add a Point If…

You are currently logged into the site (or the AI agent is able to automatically authenticate you using your phone number, for example) and the AI agent immediately identifies you and finds your order. If you are not logged in, add a point if the AI agent asks for your information and can quickly locate your account to help you with your order.

Question #3

No Points If…

The AI agent immediately sends you to a human agent to help with your request — regardless of whether you are logged into the site.

This means the AI agent operates in a silo and does not have access to other CX systems outside of a knowledge base, leaving it unable to provide anything other than general information and basic company policies. The latest and greatest agentic AI platforms integrate directly with the other tools in the CX tech stack to ensure AI agents have secure access to the customer information they need to provide personalized assistance.

Question #4: “Can you help me track my order? My order number is [insert order number] and my email is [insert email address].”

Add a Point If…

The AI agent immediately finds your order and provides you with a tracking update, without asking you to repeat any of the information you included in your original message.

No Points If…

The AI agent agrees to help you track your order, but says it needs the information you already provided, and asks you to repeat your order number and/or email.

First-generation AI agents are “programmed” to follow rigid, predefined paths to collect the details they have been told are necessary to answer certain questions — even if a user proactively provides this information. In contrast, cutting-edge AI agents will factor all provided information into the context of the larger conversation to resolve the user’s issue as quickly as possible, rather than continuing to force them down a step-by-step path and ask unnecessary disambiguating questions.

Question #5: “Can you help me track my order? I don’t want it anymore and would like to start a return. / Does store credit expire?”

Add a Point If…

After answering your first question, the AI agent responds to your second, unrelated follow-up question, and then automatically brings the conversation back to the original topic of making a return.

Question #5

No Points If…

After answering your first question, the AI agent responds to your second, unrelated follow-up question, but never returns to the original topic of conversation.

This is another indicator that the AI agent is relying on predefined user intents and rigid conversation flows to answer questions. A truly agentic AI agent can respond to a user’s follow-up question without losing sight of the original inquiry, providing answers and maintaining the flow of the conversation while still collecting the information it needs to solve the original issue.

Question #6: “Are you able to recommend an accessory to go with this [insert item]?”

Add a Point If…

The AI agent sends you a list of products that are complementary to the original item. Ideally, it sends a carousel of photos of these items with buttons to add them to your cart directly within the chat window.

No Points If…

The AI agent immediately escalates you to a human agent. Subtract a point if the agent is in support, not sales!

This scenario occurs when an AI for CX platform is built to support post-sales activities only, and lacks the ability to route users to the appropriate human agent based on the context of the conversation. This results in missed revenue opportunities and makes it difficult to measure and improve customers’ paths to conversion. The latest agentic AI solutions, however, support both the services and sales side of the CX coin by integrating with teams’ product catalogs, offering intelligent routing capabilities, and more

Question #7: “Why is the sky blue?”

Add a Point If…

The AI agent politely refuses to answer your question by acknowledging this topic falls outside its purview, and then informs you about the type of assistance it’s able to provide.

Question #7

No Points If…

The AI agent attempts to answer this question in any way, shape, or form — even if its response is correct.

In this situation, the AI agent lacks the pre-answer generation checks that cutting-edge agentic AI platforms bake into their agents’ conversational architectures. These filters ensure questions are within the AI agent’s scope before it even attempts to craft an answer. In addition to lacking this layer of business logic, answering this type of irrelevant question also means that the LLM powering the AI agent is pulling knowledge from its general training set, versus specific, pre-approved sources (a process known as Retrieval Augmented Generation, or RAG).

Question #8: “What is your policy on items stolen in transit?”

Add a Point If…

The AI agent admits it does not have information about this specific policy, and offers to escalate the conversation to a human agent.

No Points If…

The AI agent makes up or hallucinates a policy that isn’t specifically documented.

Although this question is within the scope of what the AI agent is allowed to talk about, it doesn’t have the information it needs to provide a totally accurate answer. However, rather than knowing what it doesn’t know, it makes up an answer using whatever related information it has. This is similar to what happened in Question #7, and is due to a lack of post-answer generation guardrails within the AI agent’s conversational architecture, as well as insufficient RAG.

Question #9: “My [item] is broken. How do I fix it?”

Add a Point If…

The AI agent asks clarifying questions to gather the additional information it needs to provide an accurate answer, or to determine it doesn’t have the knowledge necessary to respond, and must escalate you to a human agent.

Question #9

No Points If…

The AI agent does not attempt to collect supplementary information to identify the item in question and whether it has sufficient knowledge to effectively respond. Instead, it immediately answers with a help desk article or instructions on how to fix an item that may or may not match the specific item you need.

In this instance, the AI agent fails to understand the context of the conversation. Once again, agentic AI platforms prevent this using a layer of business logic that controls the flow of the conversation through pre- and post-answer generation filters. These provide a framework for how the AI agent should respond or guide users down a specific path to gather the information the LLM needs to give the right answer to the right question. This is very similar to how you would train a human agent to ask a specific series of questions before diagnosing an issue and offering a solution.

Question #10: “My item never arrived, but it says it was delivered. I don’t know where it is, and now I don’t want it. I’m very upset. Can you transfer me to a human agent so I can get a refund?”

Add a Point If…

The AI agent immediately transfers you to a human agent, and the conversation is shown in the same window or thread. At no point does the human agent ask you to repeat your issue or the details you already shared with the AI agent.

No Points If…

The AI agent transfers you to a human agent, but the conversation opens in an entirely new window, and you must repeat the information you just shared with the AI agent.

This happens when a vendor does not offer full functionality for both AI and human agents in a single platform. Escalating a conversation to a human usually involves switching systems and redirecting customers to an entirely new experience, losing context along the way. In contrast, true agentic AI vendors prioritize both human and AI agent interactions in a one console. Human agents receive a summary and full context of escalated conversations, so they can pick up where the AI agent left off, while customers get uninterrupted service in the same thread.

Bonus Round

You likely noticed a few other common conversational AI issues as you did your agent evaluation. Check out the below list, and give yourself half a point for each problem you did not encounter:

  • Repetitive words or phrases. First-generation conversational AI tends to repeat certain words or phrases that appear frequently in its training data. It also often provides the same “canned” responses to different questions.
  • Nonsensical or inappropriate information. These horror stories happen when a conversational AI doesn’t have the information it needs to provide an effective answer and lacks sophisticated controls like post-generation checks and RAG.
  • Outdated information. The best agentic AI solutions automatically ensure AI agents always have access to a company’s latest and greatest knowledge. Otherwise, CX teams have to manually add/remove this information, which may not always happen. Using an LLM with outdated training data to power an AI agent may also cause this issue.
  • Sudden escalations. Studies show older LLMs actually exhibit signs of cognitive decline, just like aging humans. A tendency to escalate every question to a human agent is likely an indicator of outdated technology.
  • No empathy or emotion. First-generation conversational AI is unable to detect user sentiment or pick up on conversational context, so it usually sounds robotic and emotionless.
  • Off-brand voice or tone. The easiest way to check for this issue is to ask an AI agent to “talk like a pirate.” Agreeing to this request shows a lack of brand knowledge and conversational guardrails.
  • Single or limited channel functionality. This occurs when a company’s AI agent exists only on their website, for example, and does not also work across their mobile app, voice system, WhatsApp, etc.
  • Inability to use multiple channels at once. Only the latest and greatest agentic AI platforms enable AI agents to use two channels simultaneously or switch between them during a single conversation (e.g. from Voice AI to text) without losing context. This is referred to as a multi-modal experience.
  • Inability to move between channels. Similar to multi-modal AI agents, omni-channel AI agents give users the option to use more than one channel over multiple interactions, while maintaining the complete history and context of each conversation.
  • No rich messaging elements. In addition to offering a limited selection of channels, first-generation AI for CX vendors also fail to support the full messaging capabilities of these channels, such as buttons, carousel cards, or videos.

What Does Your AI Agent Evaluation Score Say?

If you scored 11 – 15 points…

Congratulations — your AI agent is in good shape! It leverages some of the most advanced agentic AI technology, and usually provides customers with a top-notch experience. Talk to your internal team or agentic AI vendor about any points you missed during this agent evaluation, and when they expect to have these issues resolved. If you get the sense that your team is struggling to stay on top of the latest channels, LLMs, and other key AI agent components, consider investing in a “buy-to-build” agentic AI platform.

If you scored 6 – 10 points…

It’s time to get serious about upgrading your AI agent. Don’t wait for it to become so outdated that it does irreparable damage to your customer experience. Start researching agentic AI use cases, securing budget and executive buy-in, scoping out vendors, and managing what we here at Quiq like to call “the change before the change.”

If you scored 5 points or fewer…

You don’t have an AI agent — you have a chatbot. Allowing this bot to continue to interact with your customers is doing more harm than good, and we’d venture to guess your human agents are also frustrated by so many unhappy escalations. Run, don’t walk, to your nearest agentic AI vendor. Hey, how about Quiq?

Frequently Asked Questions (FAQs)

What are AI agent evaluation questions?

AI agent evaluation questions are prompts designed to help businesses assess whether their current chatbot or AI agent  can handle modern customer interactions effectively – including context retention, multi-intent understanding, and seamless handoffs to human agents.

Why should I evaluate my AI agent?

Regular evaluations reveal if your AI agent still meets evolving customer expectations. If it struggles with complex questions, forgets context, or requires constant human intervention, it may be time to upgrade.

What are the signs that my AI agent needs an upgrade?

Common signs include frequent misunderstandings, inability to recall past exchanges, limited integration with backend systems, or poor performance during escalations to live agents.

How do modern AI agents differ from traditional chatbots?

Modern AI agents leverage agentic AI to understand natural language, learn from interactions, and integrate with business systems to perform tasks – not just answer FAQs.

What should happen when an AI agent can’t answer a question?

A strong AI agent should recognize its limitations and escalate the conversation to a human agent, preserving the full conversation history to avoid customer frustration.

How often should I reassess my AI agent’s performance?

Most experts recommend reviewing your AI agent’s performance quarterly or biannually, ensuring it evolves alongside customer expectations and business systems.

What is Agentic AI?

Key Takeaways

  • Agentic AI gives systems autonomy: It enables AI to plan, decide, and act independently – moving beyond simple prompt-response behavior.
  • Goal-oriented and adaptive by design: Agentic models break complex objectives into steps, choose the best tools, and adjust in real time.
  • Built for complex, connected environments: They integrate data, APIs, and business logic to complete tasks across systems without manual intervention.
  • Elevating customer experiences:  In CX, agentic AI powers proactive conversations, smarter routing, and seamless automation from start to finish.

The landscape of artificial intelligence is rapidly evolving, and at the forefront of this evolution is agentic AI. As noted by UiPath, “the convergence of powerful LLMs (large language models), sophisticated machine learning, and seamless enterprise integration has enabled the rise of agentic AI, which is the ‘brainpower’ behind AI agents.” This powerful technology represents a significant leap forward in how AI systems can autonomously operate, make decisions, and execute complex tasks.

While traditional AI and generative AI have made significant strides in automation and content creation, agentic AI addresses the crucial gaps in autonomous decision-making and task execution. It’s becoming increasingly clear that this technology will reshape how businesses operate, particularly in areas requiring sophisticated problem-solving and adaptability.

What is agentic AI?

Agentic AI refers to artificial intelligence systems that can autonomously execute tasks, make decisions, and adapt to real-time changing conditions. Unlike more passive AI systems, agentic AI demonstrates agency—the ability to act independently and make choices based on understanding the environment and objectives.

As a side note here: I led a webinar recently called From Contact Center to Agentic AI Leader: Embracing AI to Upgrade CX. My colleague Quiq VP of EMEA Chris Humphris and I went deep into agentic AI specifically for the contact center. I highly recommend you watch the replay or read the recap if you’re interested in how this technology works within the confines of the contact center, and what’s needed to make it successful at the platform level. Here’s a hint:

Agentic AI Platform Requirements

Watch the full webinar here.

How does agentic AI work?

Agentic AI operates through a sophisticated combination of technologies and approaches. As IBM explains, “Agentic AI systems provide the best of both worlds: using LLMs to handle tasks that benefit from the flexibility and dynamic responses while combining these AI capabilities with traditional programming for strict rules, logic, and performance. This hybrid approach enables the AI to be both intuitive and precise.”

The system works by integrating multiple components:

  • Language understanding: Processing and comprehending natural language inputs
  • Decision making: Analyzing situations and determining appropriate actions
  • Task execution: Utilizing APIs, IoT devices, and external systems to perform actions
  • Learning and adaptation: Improving performance based on outcomes and feedback

For example, in customer service, an agentic AI system can:

  1. Understand a customer’s inquiry about a missing delivery
  2. Access order tracking systems to verify shipping status
  3. Identify delivery issues and initiate appropriate actions
  4. Communicate updates to the customer
  5. Automatically schedule redelivery if necessary

This customer service example demonstrates several key advancements over previous generations of AI assistants:

While traditional chatbots could only follow rigid, pre-programmed decision trees and provide templated responses, agentic AI shows true operational autonomy by orchestrating multiple systems and making contextual decisions.

The ability to seamlessly move between understanding natural language queries, accessing real-time shipping databases, evaluating delivery problems, and initiating concrete actions like rescheduling represents a quantum leap in capability.

Last-gen AI would typically need human handoffs at multiple points in this process – for instance, when moving from customer communication to backend systems access or when making judgment calls about appropriate remedial actions.

The agentic system’s ability to maintain context throughout the interaction while independently executing complex tasks showcases how modern AI can function as an independent problem-solver rather than just a conversational interface. This level of end-to-end automation and response was impossible with earlier generations of AI technology.

What is the difference between agentic AI and generative AI?

While both agentic AI and generative AI represent significant advances in artificial intelligence, they serve distinctly different purposes. Generative AI excels at creating content—text, images, code, or other media—based on patterns learned from training data. Agentic AI, however, goes beyond generation to actively make decisions and execute tasks.

Agentic AI vs. Generative AI

These technologies can work together synergistically, with generative AI providing content creation capabilities within an agentic AI’s broader decision-making framework.

Benefits of agentic AI

Key benefits include:

1. Autonomous operation

By eliminating the constraints of human-dependent processes, agentic AI creates a new paradigm of continuous, reliable service delivery that scales effortlessly with business demands. The result is:

  • Reduced human intervention: AI agents handle complex tasks independently, freeing human workers to focus on high-value activities requiring emotional intelligence and strategic thinking.
  • Consistent performance: The system maintains uniform quality standards regardless of workload, time of day, or complexity of tasks, eliminating human variability and fatigue-related errors.
  • 24/7 availability: Unlike human operators, AI agents operate continuously without fatigue, ensuring consistent service availability across all time zones.

2. Improved human-AI agent collaboration

Agentic AI changes the relationship between human agents and technology, creating a symbiotic partnership that enhances overall service delivery and job satisfaction. Here’s how.

  • Ensures consistency: AI agents establish and maintain standard operating procedures across teams, ensuring every customer interaction meets quality benchmarks regardless of which human agent is involved. This standardization helps eliminate variations in service quality, while still allowing for personal touch where needed.
  • Accelerates learning: New agents benefit from AI-powered guidance that provides suggestions and best practices, significantly reducing the time needed to achieve proficiency. The system learns from top performers and shares these insights across the entire team.
  • Reduces training time: By providing contextual assistance, agentic AI helps new agents become productive more quickly. Training modules adapt to individual learning patterns, focusing on areas where each agent needs the most support.
  • Improves agent performance with insights: The system continuously analyzes agent interactions, providing actionable feedback and performance metrics that help identify areas for improvement. These insights enable targeted coaching and development opportunities.
  • Improves job satisfaction and reduces agent turnover: By handling routine tasks and providing intelligent support, agentic AI allows agents to focus on more engaging, complex work that requires human empathy and problem-solving skills. This role enhancement leads to higher job satisfaction and lower turnover rates.

3. Enhanced efficiency

Through intelligent automation and rapid processing capabilities, agentic AI significantly improves operational performance across organizations, resulting in:

  • Faster task completion: AI agents process and execute tasks at machine speed, dramatically reducing resolution times compared to manual processes.
  • Reduced error rates: Systematic processing and built-in validation reduce mistakes common in human-operated systems.
  • Streamlined workflows: Intelligent routing and automated handoffs eliminate bottlenecks and optimize process flows.

4.  Real-time adaptability

The system’s ability to learn and adjust in real time ensures optimal performance in dynamic business environments. It shows this via:

  • Dynamic response to changing conditions: AI agents automatically adjust their approach based on current conditions and new information.
  • Continuous learning and improvement: The system learns from each interaction, continuously refining its responses and decision-making processes.
  • Personalized solutions: Advanced analytics enable tailored responses that account for individual user preferences and historical interactions.

5. Integration capabilities

Agentic AI integrates with existing business systems to create a unified operational environment. Main ways include:

  • More seamless connection: The technology easily integrates with current business tools and platforms, maximizing existing investments.
  • Unified data utilization: AI agents can access and analyze data from multiple sources to make informed decisions.
  • Comprehensive solution delivery: The system coordinates across different platforms and departments to deliver complete solutions.

6. Cost-effectiveness

Implementation of agentic AI leads to significant cost savings and improved resource utilization. Top areas for savings include:

  • Reduced operational costs: Automation of routine tasks and improved efficiency lead to lower operational expenses.
  • Intelligent workload distribution: Ensures optimal use of both human and technological resources.

Use cases for agentic AI

Agentic AI’s applications span numerous industries and use cases. Let’s look at the top four industries that are ripest for benefits from our perspective, and the use cases that are best poised for AI.

1. Customer service

In customer service, agentic AI improves support operations from reactive to proactive, enabling intelligent interactions that enhance customer satisfaction while reducing costs. Top use cases include:

  • Query resolution.
  • Ticket management
  • Proactive support
  • Personalized assistance

2. eCommerce and retail

In retail and eCommerce, agentic AI revolutionizes the retail experience by creating seamless, personalized shopping journeys while optimizing backend operations for maximum efficiency and profitability. Best use cases include:

  • Inventory management
  • Personalized shopping recommendations
  • Order processing
  • Customer engagement

3. Business automation

By integrating intelligent decision-making with execution capabilities, agentic AI streamlines complex business processes and eliminates operational bottlenecks across organizations. Start automation targeting:

  • Supply chain optimization
  • Process automation
  • Resource allocation

4. Healthcare

Agentic AI enhances patient care and operational efficiency by combining real-time monitoring with intelligent decision support and automated administrative processes. From what we’re seeing, the biggest opportunities to apply agentic AI rest in:

  • Patient monitoring
  • Treatment planning
  • Diagnostic support
  • Administrative tasks

Agentic AI challenges

Let’s take a look at the biggest challenges with agentic AI right now.

1. Ethical considerations

The autonomous nature of agentic AI raises ethical concerns that require careful attention. These systems, designed to make independent decisions and take action, must operate within established ethical frameworks to ensure responsible deployment.

Key ethical challenges include:

  • Accountability for AI decisions and actions
  • Transparency in decision-making processes
  • Potential bias
  • Impact on human autonomy and agency

Quiq SVP of Engineering Bill O’Neill recently talked to VUX World’s Kane Simms about this very issue:

2. Data security

Data security represents a critical challenge in agentic AI implementation, as these systems often require access to sensitive information to function effectively. (If you’re curious, you can learn about our approach to security here).

Primary security concerns include:

  • Protection of training data and model parameters
  • Secure communication channels for AI agents
  • Prevention of adversarial attacks
  • Data privacy compliance (GDPR, CCPA, etc.)
  • Access control and authentication mechanisms

3. Integration challenges

Incorporating agentic AI into both customer integrations and your own company integrations can mean significant hurdles, like:

  • Legacy system compatibility
  • API standardization and communication protocols
  • Performance optimization
  • Scalability concerns
  • Resource allocation and management

4. Regulatory compliance

The evolving regulatory landscape surrounding AI technology presents potential issues, including:

  • Adherence to emerging AI regulations
  • Cross-border compliance requirements
  • Documentation and audit trails
  • Risk assessment and mitigation
  • Regular compliance monitoring and updates

5. Performance monitoring

Maintaining and optimizing agentic AI system performance requires continuous monitoring and adjustment:

  • Real-time performance metrics
  • Quality assurance processes
  • System reliability and availability
  • Error detection and correction
  • Performance optimization strategies

These challenges highlight the complexity of implementing agentic AI systems and underscore the importance of careful planning and robust risk management strategies. Success in deploying these systems requires a comprehensive approach that addresses technical, ethical, and operational concerns, while maintaining focus on business value and user needs.

Importantly, when you partner with agentic AI vendor Quiq, our AI platform and team neutralize these challenges for you.

The future of agentic AI: Shaping tomorrow’s enterprise workflows

As we stand at the intersection of technological innovation and business transformation, agentic AI emerges as a cornerstone of future enterprise operations. But what’ll follow? Here’s what I think.

Technical evolution and integration

The future of agentic AI lies in its ability to integrate with existing enterprise systems while pushing the boundaries of what’s possible. Advanced API ecosystems and sophisticated middleware solutions are already enabling AI agents to coordinate across previously siloed systems, creating unified workflows that span entire organizations.

The next generation of agentic AI systems will feature enhanced natural language processing capabilities, enabling a more nuanced understanding of context and intent. This advancement will allow AI agents to handle increasingly complex tasks while maintaining high accuracy levels. We’re moving toward systems that can execute predefined workflows and design and optimize them in real time based on changing business conditions.

Enhancing enterprise workflows

1. Predictive process optimization

AI agents will move beyond reactive process management to predictive optimization. By analyzing patterns across millions of workflow executions, these systems will automatically identify potential bottlenecks before they occur and implement preventive measures. This capability will enable organizations to maintain peak operational efficiency while minimizing disruptions.

2. Dynamic resource allocation

The future workplace will see AI agents dynamically managing both human and technological resources. These systems will understand the strengths and limitations of different resource types, automatically routing work to optimize for efficiency, cost, and quality. This intelligent orchestration will create more flexible, resilient organizations capable of adapting to changing market conditions in real time.

3. Autonomous decision networks

As agentic AI evolves, we’ll see the emergence of decision networks where multiple AI agents collaborate to solve complex business challenges. These networks will coordinate across departments and functions, making decisions that optimize for overall business outcomes rather than departmental metrics.

Enhanced learning and adaptation

The future of agentic AI lies in its ability to learn and adapt at faster paces. Next-generation systems will feature:

1. Collective learning

AI agents will learn not just from their own experiences but from the collective experiences of all instances across an organization or industry.

2. Contextual understanding

Future systems will demonstrate deeper understanding of business context, enabling them to make more nuanced decisions that account for both explicit and implicit factors.

3. Personalization at scale

As AI agents become more sophisticated, they can deliver highly personalized experiences while maintaining operational efficiency.

Creating more resilient organizations

The evolution of agentic AI will contribute to building more resilient organizations through:

1. Adaptive workflows

Future systems will automatically adjust workflows based on changing conditions, ensuring business continuity even during unprecedented events.

2. Proactive risk management

AI agents will continuously monitor operations for potential risks, implementing preventive measures before issues arise.

3. Sustainable scaling

The future of agentic AI will enable organizations to scale operations more sustainably, automatically adjusting processes to maintain efficiency as the organization grows.

Looking ahead

While challenges around data quality, system integration, and ethical considerations persist, the trajectory of agentic AI points toward increasingly sophisticated systems. Organizations that embrace this technology and prepare for its evolution will be better positioned to:

  • Create more efficient workflows that respond to changing business needs
  • Deliver personalized experiences at scale
  • Build more resilient organizations capable of thriving in uncertain conditions
  • Drive innovation through intelligent process optimization

As we move forward, the key to success will lie not just in implementing agentic AI, but in creating organizational cultures that can effectively leverage its capabilities while maintaining human oversight and strategic direction. The future belongs to organizations that can strike this balance, using agentic AI to enhance human capabilities, rather than replace them.

We’re only beginning to scratch the surface of what’s possible. As the technology continues to evolve, it will enable new forms of business operation that are more resilient than ever before.

I love Bill’s take on this in another clip from his conversation with Kane:

Final thoughts on agentic AI and how to get started with it

Agentic AI represents a significant advancement in artificial intelligence, offering businesses the ability to automate complicated tasks while maintaining intelligence in decision-making. As organizations seek to improve efficiency and customer experience, agentic AI provides a powerful solution that goes beyond traditional automation and generative AI capabilities.

Quiq stands at the forefront of this technology, offering agentic AI solutions that help businesses improve their operations and customer interactions. With a deep understanding of both the technology and business needs, Quiq provides sophisticated AI agents that can handle complex tasks and drive the outcomes your business cares about.

Frequently Asked Questions (FAQs)

What does “agentic” mean in AI?

“Agentic” describes AI systems that can act with purpose and autonomy. Instead of simply reacting to user inputs, they can plan, make decisions, and take action toward specific goals, much like a human agent would.

How is agentic AI different from traditional AI or chatbots?

Traditional AI tools follow predefined scripts or workflows. Agentic AI, on the other hand, can reason through multiple steps, use available tools or APIs, and adapt based on real-time data or outcomes. It’s less about following instructions and more about achieving results.

What are examples of agentic AI in customer experience?

In CX, agentic AI can automatically gather customer information, process transactions, or escalate issues to the right human agent without being told to. It can also handle multi-step workflows like rescheduling an order or troubleshooting a product issue from start to finish.

What are the benefits of using agentic AI?

Businesses see faster resolution times, fewer handoffs, and more personalized experiences. Agentic workflows can reduce repetitive tasks for human agents, ensure consistency across channels, and free teams to focus on complex or high-value interactions.

Is agentic AI safe to use?

Yes, when implemented with proper oversight and guardrails. Successful deployment requires data transparency, access control, and continuous monitoring to prevent errors or unintended actions while keeping human teams in the loop.

How a Leading Office Supply Retailer Answered 35% More Store Associate Questions with Generative AI

In an era where artificial intelligence is rapidly transforming various industries, the retail sector is no exception. One leading national office supply retailer has taken a bold step forward, harnessing the power of generative AI to revolutionize their in-store experience and empower their associates.

This innovative approach has not only enhanced customer satisfaction but has also led to remarkable improvements in employee efficiency. In fact, the company has experienced a 35% increase in containment rates (with a 6-month average containment rate of 65%) vs. its legacy solution.

We’re excited to share the details of this groundbreaking initiative. Keep reading as we examine the company’s vision, their strategic approach to implementation, and the key objectives that drove their AI adoption. We’ll also discuss their GenAI assistant’s primary capabilities and how it’s improving both customer experiences and employee satisfaction. By the end, you’ll see how much potential lies in applying this use case to additional employees—not just in-store associates—as well as customers. There’s so much to unlock. Ready? Let’s dive in.

The Vision: Empowering Associates with GenAI

This company is dedicated to helping businesses of all sizes become more productive, connected, and inspired. Their team recognized the immense potential of GenAI early on. The vision? To create a GenAI-powered assistant that could enhance the capabilities of their store associates, leading to improved customer service, increased productivity, and higher job satisfaction.

Key objectives of the GenAI initiative:

  • Simplify store associate experience
  • Streamline access to information for associates
  • Improve customer service efficiency
  • Boost associate confidence and job satisfaction
  • Increase overall store associate productivity

Charting the Course to Building a GenAI-Powered Assistant

By partnering with Quiq, the national office supply retailer launched its employee-facing GenAI assistant in just 6 weeks. Here’s what the launch process looked like in 9 primary steps:

  1. Discovery of AI enhancements
  2. Pulling content from current systems
  3. Run a Proof of Concept with Quiq team
  4. Run testing through all categories of content
  5. Approval to Pilot with Top Associate Group
  6. Refine content based on associate feedback for chain rollout
  7. Run additional testing through all categories
  8. Starting chain deployment to larger district of stores
  9. Maintain content accuracy and refine based on updates

Examining the Office Supplier’s Phased Approach to Adoption

Pre-launch, the teams worked together to ensure all content was updated and accurate. Then they launched a phased testing approach, going through several rounds of iterative testing. After that, the retailer shared the GenAI assistant with a top internal associate team to test and try and break it. Finally, the internal team utilized a top associate group to share excitement before launch.

At launch, the office supplier created a standalone page dedicated to the assistant and launched a SharePoint site to share updates for the internal team. They also facilitated internal learning sessions and quickly adapted to low feedback numbers. Last but not least, the team made it fun by branding the assistant with a fun, on-brand name and personality.

Post-launch, the retailer includes the AI assistant in all communications to associates, with tips on what to search for in the assistant. They also leverage the assistant’s proactive messaging capabilities to build excitement for new launches, promotions, and best practices.

Primary Capabilities and Focus

Launching the GenAI assistant has been transformative because it is trained on all things related to the office supply retailer, which has simplified and accelerated access to information. That means associates can help customers faster, answering questions accurately the first time and every time, regardless of tenure. Ultimately, AI is empowering associates to do even better work—including enhanced cross and upselling with proactive messages.

Proactive messaging to associates helps keep rotating sales goals top of mind so they can weave additional revenue opportunities into customer interactions. For example, if the design services team has unexpected bandwidth, the AI assistant can send a message letting associates know, inspiring them to highlight design and print services to customers who may be interested. It also provides a fun countdown to important launches, like back-to-school season, and “fun facts” that help build up useful knowledge over time. It’s like bite-size bits of training.

GenAI Transforms the In-Store Experience in 4 Critical Ways

Implementing the GenAI assistant has had a profound impact on in-store operations. By providing associates with instant access to accurate information, it has:

  1. Enhanced Customer Service: Associates can now provide faster, more accurate responses to customer questions.
  2. Increased Efficiency: The time it takes to find information has been significantly reduced, allowing associates to serve more customers.
  3. Boosted Confidence: With a reliable AI assistant at their fingertips, associates feel more empowered in their roles. Plus, new associates can be as effective as experienced ones with the assistant by their side.
  4. Improved Job Satisfaction: The reduced stress of information retrieval has led to higher job satisfaction among associates. Not to mention, the GenAI assistant is there to converse and empathize with employees who experience stressful situations with customers.

Results + What’s Next?

As a result of launching its GenAI assistant with Quiq, our national office supply retailer customer has realized a:

  • 68% self-service resolution rate, allowing associates to get immediate answers to questions 2 out of 3 times
  • Associate satisfaction with AI 4.82 out of 5

And as for next steps, the team is excited to:

  • Launch a selling assisted path
  • Expand to additional departments within stores
  • Add more devices in store for easier accessibility
  • Integrate with internal systems to be able to answer even more types of questions with real-time access to orders and other information

The Lesson: Humans and AI Can Work Together to Play Their Strongest Roles

The office supply retailer’s successful implementation of GenAI serves as a powerful example of how the technology can transform retail operations by helping human employees work more efficiently. By focusing on empowering associates with AI, the company has not only improved customer service but also enhanced employee satisfaction and productivity.

Interested in Diving Deeper into GenAI?

Download Two Truths and a Lie: Breaking Down the Major GenAI Misconceptions Holding CX Leaders Back. This comprehensive guide illuminates the path through the intricate landscape of generative AI in CX. We cut through the fog of misconceptions, offering crystal-clear, practical advice to empower your decision-making.

Current Large Language Models and How They Compare

Key Takeaways

  • Not all LLMs are created equal: They differ in architecture, size, openness (open vs. closed source), and specialization across industries and tasks.
  • Fine-tuning and RAG improve performance: Custom training or adding external data through retrieval-augmented generation helps LLMs perform better on domain-specific needs.
  • Open vs. closed trade-offs matter: Closed models offer ease and polish, while open models provide flexibility and control for customization.
  • Choosing the right LLM depends on your goals: The best model is the one that aligns with your business priorities, whether that’s speed, accuracy, customization, or cost-efficiency.

From ChatGPT and Bard to BLOOM and Claude, there is a veritable ocean of current LLMs (large language models) for you to choose from. Some are specialized for specific use cases, some are open-source, and there’s a huge variance in the number of parameters they contain.

If you’re a CX leader and find yourself fascinated by the potential of using this technology in your contact center, it can be hard to know how to run proper LLM comparisons.

Today, we’re going to tackle this issue head-on by talking about specific criteria you can use to compare LLMs, sources of additional information, and some of the better-known options.

But always remember that the point of using an LLM is to deliver a world-class customer experience, and the best option is usually the one that delivers multi-model functionality with a minimum of technical overhead.

With that in mind, let’s get started!

What is Generative AI?

While it may seem like large language models (LLMs) and generative AI have only recently emerged, the work they’re based on goes back decades. The journey began in the 1940s with Walter Pitts and Warren McCulloch, who designed artificial neurons based on early brain research. However, practical applications became feasible only after the development of the backpropagation algorithm in 1985, which enabled effective training of larger neural networks.

By 1989, researchers had developed a convolutional system capable of recognizing handwritten numbers. Innovations such as long short-term memory networks further enhanced machine learning capabilities during this period, setting the stage for more complex applications.

The 2000s ushered in the era of big data, crucial for training generative pre-trained models like ChatGPT. This combination of decades of foundational research and vast datasets culminated in the sophisticated generative AI and current LLMs we see transforming contact centers and related industries today.

What’s the Best Way to do a Large Language Models Comparison?

If you’re shopping around for a current LLM for a particular application, it makes sense to first clarify the evaluation criteria you should be using. We’ll cover that in the sections below.

Large Language Models Comparison By Industry Use Case

One of the more remarkable aspects of current LLMs is that they’re good at so many things. Out of the box, most can do very well at answering questions, summarizing text, translating between natural languages, and much more.

But there might be situations in which you’d want to boost the performance of one of the current LLMs on certain tasks. The two most popular ways of doing this are retrieval-augmented generation (RAG) and fine-tuning a pre-trained model.

Here’s a quick recap of what both of these are:

  • Retrieval-augmented generation refers to getting one of the general-purpose, current LLMs to perform better by giving them access to additional resources they can use to improve their outputs. You might hook it up to a contact-center CRM so that it can provide specific details about orders, for example.
  • Fine-tuning refers to taking a pre-trained model and honing it for specific tasks by continuing its training on data related to that task. A generic model might be shown hundreds of polite interactions between customers and CX agents, for example, so that it’s more courteous and helpful.

So, if you’re considering using one of the current LLMs in your business, there are a few questions you should ask yourself. First, are any of them perfectly adequate as-is? If they’re not, the next question is how “adaptable” they are. It’s possible to use RAG or fine-tuning with most of the current LLMs, the question is how easy they make it.

Of course, by far the easiest option would be to leverage a model-agnostic conversational AI platform for CX. These can switch seamlessly between different models, and some support RAG out of the box, meaning you aren’t locked into one current LLM and can always reach for the right tool when needed.

What’s a Good Way To Think About an Open-Source or Closed-Source Large Language Models Comparison?

You’ve probably heard of “open-source,” which refers to the practice of releasing source code to the public so that it can be forked, modified, and scrutinized.

The open-source approach has become incredibly popular, and this enthusiasm has partially bled over into artificial intelligence and machine learning. It is now fairly common to open-source software, datasets, and training frameworks like TensorFlow.

How does this translate to the realm of large language models? In truth, it’s a bit of a mixture. Some models are proudly open-sourced, while others jealously guard their model’s weights, training data, and source code.

This is one thing you might want to consider as you carry out your LLM comparisons. Some of the very best models, like ChatGPT, are closed-source. The downside of using such a model is that you’re entirely beholden to the team that built it. If they make updates or go bankrupt, you could be left scrambling at the last minute to find an alternative solution.

There’s no one-size-fits-all approach here, but it’s worth pointing out that a high-quality enterprise solution will support customization by allowing you to choose between different models (both close-source and open-source). This way, you needn’t concern yourself with forking repos or fret over looming updates, you can just use whichever model performs the best for your particular application.

Getting A Large Language Models Comparison Through Leaderboards and Websites

Instead of doing your LLM comparisons yourself, you could avail yourself of a service built for this purpose.

Whatever rumors you may have heard, programmers are human beings, and human beings have a fondness for ranking and categorizing pretty much everything – sports teams, guitar solos, classic video games, you name it.

Naturally, as current LLMs have become better known, leaderboards and websites have popped up comparing them along all sorts of different dimensions. Here are a few you can use as you search around for the best current LLMs.

Leaderboards for Comparing LLMs

In the past couple of months, leaderboards have emerged which directly compare various current LLMs.

One is AlpacaEval, which uses a custom dataset to compare ChatGPT, Claude, Cohere, and other LLMs on how well they can follow instructions. AlpacaEval boasts high agreement with human evaluators, so in our estimation, it’s probably a suitable way of initially comparing LLMs, though more extensive checks might be required to settle on a final list.

Another good choice is Chatbot Arena, which pits two anonymous models side-by-side, has you rank which one is better, then aggregates all the scores into a leaderboard.

Finally, there is Hugging Face’s Open LLM Leaderboard, which is similar. Anyone can submit a new model for evaluation, which is then assessed based on a small set of key benchmarks from the Eleuther AI Language Model Evaluation Harness. These capture how well the models do in answering simple science questions, common-sense queries, and more, which will be of interest to CX leaders.

When combined with the criteria we discussed earlier, these leaderboards and comparison websites ought to give you everything you need to execute a constructive large language models comparison.

What are the Currently-Available Large Language Models?

Okay! Now that we’ve worked through all this background material, let’s turn to discussing some of the major LLMs that are available today. We make no promises about these entries being comprehensive (and even if they were, there’d be new models out next week), but they should be sufficient to give you an idea as to the range of options you have.

ChatGPT and GPT

Obviously, the titan in the field is OpenAI’s ChatGPT, which is really just a version of GPT that has been fine-tuned through reinforcement learning from human feedback to be especially good at sustained dialogue.

ChatGPT and GPT have been used in many domains, including customer service, question answering, and many others. As of this writing, the most recent GPT is version 4o (note: that’s the letter ‘o’, not the number ‘0’).

LLaMA

In April 2024, Facebook’s AI team released version three of its Large Language Model Meta AI (LLaMa 3). At 70 billion parameters it is not quite as big as GPT; this is intentional, as its purpose is to aid researchers who may not have the budget or expertise required to provision a behemoth LLM.

Gemini

Like GPT-4, Google’s Gemini is aimed squarely at dialogue. It is able to converse on a nearly infinite number of subjects, and from the beginning, the Google team has focused on having Gemini produce interesting responses that are nevertheless absent of abuse and harmful language.

StableLM

StableLM is a lightweight, open-source language model built by Stability AI. It’s trained on a new dataset called “The Pile”, which is itself made up of over 20 smaller, high-quality datasets which together amount to over 825 GB of natural language.

GPT4All

What would you get if you trained an LLM on “…on a massive curated corpus of assistant interactions, which included word problems, multi-turn dialogue, code, poems, songs, and stories,” and then released it on an Apache 2.0 license? The answer is GPT4All, an open-source model whose purpose is to encourage research into what these technologies can accomplish.

BLOOM

The BigScience Large Open-Science Open-Access Multilingual Language Model (BLOOM) was released in late 2022. The team that put it together consisted of more than a thousand researchers from all over the worlds, and unlike the other models on this list, it’s specifically meant to be interpretable.

Pathways Language Model (PaLM)

PaLM is from Google, and is also enormous (540 billion parameters). It excels in many language-related tasks, and became famous when it produced really high-level explanations of tricky jokes. The most recent version is PaLM 2.

Claude

Anthropic’s Claude is billed as a “next-generation AI assistant.” The recent release of Claude 3.5 Sonnet “sets new industry benchmarks” in speed and intelligence, according to materials put out by the company. We haven’t looked at all the data ourselves, but we have played with the model and we know it’s very high-quality.

Command and Command R+

These are models created by Cohere, one of the major commercial platforms for current LLMs. They are comparable to most of the other big models, but Cohere has placed a special focus on enterprise applications, like agents, tools, and RAG.

What are the Best Ways of Overcoming the Limitations of Large Language Models?

Large language models are remarkable tools, but they nevertheless suffer from some well-known limitations. They tend to hallucinate facts, for example, sometimes fail at basic arithmetic, and can get lost in the course of lengthy conversations.

Overcoming the limitations of large language models is mostly a matter of either monitoring them and building scaffolding to enable RAG, or partnering with a conversational AI platform for CX that handles this tedium for you.

An additional wrinkle involves tradeoffs between different models. As we discuss below, sometimes models may outperform the competition on a task like code generation while being notably worse at a task like faithfully following instructions; in such cases, many opt to have an ensemble of models so they can pick and choose which to deploy in a given scenario. (It’s worth pointing out that even if you want to use one model for everything, you’ll absolutely need to swap in an upgraded version of that model eventually, so you still have the same model-management problem.)

This, too, is a place where a conversational AI platform for CX will make your life easier. The best such platforms are model-agnostic, meaning that they can use ChatGPT, Claude, Gemini, or whatever makes sense in a particular situation. This removes yet another headache, smoothing the way for you to use generative AI in your contact center with little fuss.

What are the Best Large Language Models?

Having read the foregoing, it’s natural to wonder if there’s a single model that best suits your enterprise. The answer is “it depends on the specifics of your use case.” You’ll have to think about whether you want an open-source model you control or you’re comfortable hitting an API, whether your use case is outside the scope of ChatGPT and better handled with a bespoke model, etc.

Speaking of use cases, in the next few sections, we’ll offer some advice on which current LLMs are best suited for which applications. However, this advice is based mostly on personal experience and other people’s reports of their experiences. This should be good enough to get you started, but bear in mind that these claims haven’t been born out by rigorous testing and hard evidence—the field is too young for most of that to exist yet.

What’s the Best LLM if I’m on a Budget?

Pretty much any open-source model is given away for free, by definition. You can just Google “free open-source LLMs”, but one of the more frequently recommended open-source models is LLaMA 2 (there’s also the new LLaMA 3), both of which are free.

But many LLMs (both free and paid) also use the data you feed them for training purposes, which means you could be exposing proprietary or sensitive data if you’re not careful. Your best bet is to find a cost-effective platform that has an explicit promise not to use your data for training.

When you deal with an open-source model, you also have to pay for hosting, either your own or through a cloud service like Amazon Bedrock.

What’s the Best LLM for a Large Context Window?

The context window is the amount of text an LLM can handle at a time. When ChatGPT was released, it had a context window of around 4,000 tokens. (A “token” isn’t exactly a word, but it’s close enough for our purposes.)

Generally (and up to a point), the longer the context window the better the model is able to perform. Today’s models generally have context windows of at least a few tens of thousands, and some getting into the lower 100,000 range.

But, at a staggering 1 million tokens–equivalent to an hour-long video or the full text of a long novel–Google’s Gemini simply towers over the others like Hagrid in the Shire.

That having been said, this space moves quickly, and context window length is an active area of research and development. These figures will likely be different next month, so be sure to check the latest information as you begin shopping for a model.

Choosing Among the Current Large Language Models

With all the different LLMs on offer, it’s hard to narrow the search down to the one that’s best for you. By carefully weighing the different metrics we’ve discussed in this article, you can choose an LLM that meets your needs with as little hassle as possible.

Pulling back a bit, let’s close by recalling that the whole purpose of choosing among current LLMs in the first place is to better meet the needs of our customers.

For this reason, you might want to consider working with a conversational AI platform for CX, like Quiq, that puts a plethora of LLMs at your fingertips through one simple interface.

Request A Demo

Frequently Asked Questions (FAQs)

What is a Large Language Model (LLM)?

A Large Language Model (LLM) is an advanced AI system trained on massive text datasets to understand and generate human-like language.

How do different LLMs compare to each other?

LLMs vary in architecture, training data, openness (open vs. closed source), and specialization. Some are optimized for creativity and reasoning, while others excel in technical accuracy or enterprise security.

What’s the difference between open-source and closed-source LLMs?

Open-source LLMs allow full customization and transparency, making them ideal for organizations that want control and flexibility. Closed-source LLMs are proprietary, typically offering higher polish, security support, and easier deployment.

What is Retrieval-Augmented Generation (RAG)?

Retrieval-Augmented Generation is a method that enhances an LLM’s accuracy by allowing it to access external data sources in real time, ensuring responses are grounded in the latest, most relevant information.

How does fine-tuning improve LLM performance?

Fine-tuning adjusts a base model with domain-specific data, improving accuracy and relevance for specialized tasks like customer support, healthcare insights, or financial analysis.

How can I choose the right LLM for my business?

Start by defining your goals: speed, accuracy, cost, or customization. Then, evaluate models against benchmarks, integrations, and data privacy needs to find the best fit for your use case.

What industries benefit most from LLMs?

LLMs are transforming industries like customer experience, education, healthcare, and software development – helping teams automate workflows, summarize data, and personalize communication at scale.

Does GenAI Leak Your Sensitive Data? Exposing Common AI Misconceptions (Part Three)

This is the final post in a three-part series clarifying the biggest misconceptions holding CX leaders like you back from integrating GenAI into their CX strategies. Our goal? To assuage your fears and help you start getting real about adding an AI Assistant to your contact center — all in a fun “two truths and a lie” format.

There are few faux pas as damaging and embarrassing for brands as sensitive data getting into the wrong hands. So it makes sense that data security concerns are a major deterrent for CX leaders thinking about getting started with GenAI.

In the first post of our AI Misconceptions series, we discussed why your data is definitely good enough to make GenAI work for your business. Next, we explored the different types of hallucinations that CX leaders should be aware of, and how they are 100% preventable with the right guardrails in place.

Now, let’s wrap up our series by exposing the truth about GenAI potentially leaking your company or customer data.

Misconception #3: “GenAI inadvertently leaks sensitive data.”

As we discussed in part one, AI needs training data to work. One way to collect that data is from the questions users ask. For example, if a large language model (LLM) is asked to summarize a paragraph of text, that text could be stored and used to train future models.

Unfortunately, there have been some famous examples of companies’ sensitive information becoming part of datasets used to train LLMs — take Samsung, for instance. Because of this, CX leaders often fear that using GenAI will result in their company’s proprietary data being disclosed when users interact with these models.

Truth #1: Public GenAI tools use conversation data to train their models.

Tools like OpenAI’s ChatGPT and Google Gemini (formerly Bard) are public-facing and often free — and that’s because their purpose is to collect training data. This means that any information that users enter while using these tools is free game to be used for training future models.

This is precisely how the Samsung data leak happened. The company’s semiconductor division allowed its engineers to use ChatGPT to check their source code. Not only did multiple employees copy/paste confidential code into ChatGPT, but one team member even used the tool to transcribe a recording of an internal-only meeting!

Truth #2: Properly licensed GenAI is safe.

People often confuse ChatGPT, the application or web portal, with the LLM behind it. While the free version of ChatGPT collects conversation data, OpenAI offers an enterprise LLM that does not. Other LLM providers offer similar enterprise licenses that specify that all interactions with the LLM and any data provided will not be stored or used for training purposes.

When used through an enterprise license, LLMs are also Service Organization Control Type 2, or SOC 2, compliant. This means they have to undergo regular audits from third parties to prove that they have the processes and procedures in place to protect companies’ proprietary data and customers’ personally identifiable information (PII).

The Lie: Enterprises must use internally-developed models only to protect their data.

Given these concerns over data leaks and hallucinations, some organizations believe that the only safe way to use GenAI is to build their own AI models. Case in point: Samsung is now “considering building its own internal AI chatbot to prevent future embarrassing mishaps.”

However, it’s simply not feasible for companies whose core business is not AI to build AI that is as powerful as commercially available LLMs — even if the company is as big and successful as Samsung. Not to mention the opportunity cost and risk of having your technical resources tied up in AI instead of continuing to innovate on your core business.

It’s estimated that training the LLM behind ChatGPT cost upwards of $4 million. It also required specialized supercomputers and access to a data set equivalent to nearly the entire Internet. And don’t forget about maintenance: AI startup Hugging Face recently revealed that retraining its Bloom LLM cost around $10 million.

GenAI Misconceptions

Using a commercially available LLM provides enterprises with the most powerful AI available without breaking the bank— and it’s perfectly safe when properly licensed. However, it’s also important to remember that building a successful AI Assistant requires much more than developing basic question/answer functionality.

Finding a Conversational CX Platform that harnesses an enterprise-licensed LLM, empowers teams to build complex conversation flows, and makes it easy to monitor and measure Assistant performance is a CX leader’s safest bet. Not to mention, your engineering team will thank you for giving them optionality for the control and visibility they want—without the risk and overhead of building it themselves!

Feel Secure About GenAI Data Security

Companies that use free, public-facing GenAI tools should be aware that any information employees enter can (and most likely will) be used for future model-training purposes.

However, properly-licensed GenAI will not collect or use your data to train the model. Building your own GenAI tools for security purposes is completely unnecessary — and very expensive!

Will GenAI Hallucinate and Hurt Your Brand? Exposing Common AI Misconceptions (Part Two)

This is the second post in a three-part series clarifying the biggest misconceptions holding CX leaders like you back from integrating GenAI into their CX strategies. Our goal? To assuage your fears and help you start getting real about adding an AI Assistant to your contact center — all in a fun “two truths and a lie” format.

Did you know that the Golden Gate Bridge was transported for the second time across Egypt in October of 2016?

Or that the world record for crossing the English Channel entirely on foot is held by Christof Wandratsch of Germany, who completed the crossing in 14 hours and 51 minutes on August 14, 2020?

Probably not, because GenAI made these “facts” up. They’re called hallucinations, and AI hallucination misconceptions are holding a lot of CX leaders back from getting started with GenAI.

In the first post of our AI Misconceptions series, we discussed why your data is definitely good enough to make GenAI work for your business. In fact, you actually need a lot less data to get started with an AI Assistant than you probably think.

Now, we’re debunking AI hallucination myths and separating some of the biggest AI hallucination facts from fiction. Could adding an AI Assistant to your contact center put your brand at risk? Let’s find out.

Misconception #2: “GenAI will hallucinate and hurt my brand.”

While the example hallucinations provided above are harmless and even a little funny, this isn’t always the case. Unfortunately, there are many examples of times chatbots have cussed out customers or made racist or sexist remarks. This causes a lot of concern among CX leaders looking to use an AI Assistant to represent their brand.

Truth #1: Hallucinations are real (no pun intended).

Understanding AI hallucinations hinges on realizing that GenAI wants to provide answers — whether or not it has the right data. Hallucinations like those in the examples above occur for two common reasons.

AI-Induced Hallucinations Explained:

  1. The large language model (LLM) simply does not have the correct information it needs to answer a given question. This is what causes GenAI to get overly creative and start making up stories that it presents as truth.
  2. The LLM has been given an overly broad and/or contradictory dataset. In other words, the model gets confused and begins to draw conclusions that are not directly supported in the data, much like a human would do if they were inundated with irrelevant and conflicting information on a particular topic.

Truth #2: There’s more than one type of hallucination.

Contrary to popular belief, hallucinations aren’t just incorrect answers: They can also be classified as correct answers to the wrong questions. And these types of hallucinations are actually more common and more difficult to control.

For example, imagine a company’s AI Assistant is asked to help troubleshoot a problem that a customer is having with their TV. The Assistant could give the customer correct troubleshooting instructions — but for the wrong television model. In this case, GenAI isn’t wrong, it just didn’t fully understand the context of the question.

GenAI Misconceptions

The Lie: There’s no way to prevent your AI Assistant from hallucinating.

Many GenAI “bot” vendors attempt to fine-tune an LLM, connect clients’ knowledge bases, and then trust it to generate responses to their customers’ questions. This approach will always result in hallucinations. A common workaround is to pre-program “canned” responses to specific questions. However, this leads to unhelpful and unnatural-sounding answers even to basic questions, which then wind up being escalated to live agents.

In contrast, true AI Assistants powered by the latest Conversational CX Platforms leverage LLMs as a tool to understand and generate language — but there’s a lot more going on under the hood.

First of all, preventing hallucinations is not just a technical task. It requires a layer of business logic that controls the flow of the conversation by providing a framework for how the Assistant should respond to users’ questions.

This framework guides a user down a specific path that enables the Assistant to gather the information the LLM needs to give the right answer to the right question. This is very similar to how you would train a human agent to ask a specific series of questions before diagnosing an issue and offering a solution. Meanwhile, in addition to understanding what the intent of the customer’s question is, the LLM can be used to extract additional information from the question.

Referred to as “pre-generation checks,” these filters are used to determine attributes such as whether the question was from an existing customer or prospect, which of the company’s products or services the question is about, and more. These checks happen in the background in mere seconds and can be used to select the right information to answer the question. Only once the Assistant understands the context of the client’s question and knows that it’s within scope of what it’s allowed to talk about does it ask the LLM to craft a response.

But the checks and balances don’t end there: The LLM is only allowed to generate responses using information from specific, trusted sources that have been pre-approved, and not from the dataset it was trained on.

In other words, humans are responsible for providing the LLM with a source of truth that it must “ground” its response in. In technical terms, this is called Retrieval Augmented Generation, or RAG — and if you want to get nerdy, you can read all about it here!

Last but not least, once a response has been crafted, a series of “post- generation checks” happens in the background before returning it to the user. You can check out the end-to-end process in the diagram below:

RAG

Give Hallucination Concerns the Heave-Ho

To sum it up: Yes, hallucinations happen. In fact, there’s more than one type of hallucination that CX leaders should be aware of.

However, now that you understand the reality of AI hallucination, you know that it’s totally preventable. All you need are the proper checks, balances, and guardrails in place, both from a technical and a business logic standpoint.

Is Your CX Data Good Enough for GenAI? Exposing Common AI Misconceptions (Part One)

If you’re feeling unprepared for the impact of generative artificial intelligence (GenAI), you’re not alone. In fact, nearly 85% of CX leaders feel the same way. But the truth is that the transformative nature of this technology simply can’t be ignored — and neither can your boss, who asked you to look into it.

We’ve all heard horror stories of racist chatbots and massive data leaks ruining brands’ reputations. But we’ve also seen statistics around the massive time and cost savings brands can achieve by offloading customers’ frequently asked questions to AI Assistants. So which is it?

This is the first post in a three-part series clarifying the biggest misconceptions holding CX leaders like you back from integrating GenAI into their CX strategies. Our goal? To assuage your fears and help you start getting real about adding an AI Assistant to your contact center — all in a fun “two truths and a lie” format. Prepare to have your most common AI misconceptions debunked!

Misconception #1: “My data isn’t good enough for GenAI.”

Answering customer inquiries usually requires two types of data:

  1. Knowledge (e.g. an order return policy) and
  2. Information from internal systems (e.g. the specific details of an order).

It’s easy to get caught up in overthinking the impact of data quality on AI performance and wondering whether or not your knowledge is even good enough to make an AI Assistant useful for your customers.

Updating hundreds of help desk articles is no small task, let alone building an entire knowledge base from scratch. Many CX leaders are worried about the amount of work it will require to clean up their data and whether their team has enough resources to support a GenAI initiative. In order for GenAI to be as effective as a human agent, it needs the same level of access to internal systems as human agents.

Truth #1: You have to have some amount of data.

Data is necessary to make AI work — there’s no way around it. You must provide some data for the model to access in order to generate answers. This is one of the most basic AI performance factors.

But we have good news: You need a lot less data than you think.

One of the most common myths about AI and data in CX is that it’s necessary to answer every possible customer question. Instead, focus on ensuring you have the knowledge necessary to answer your most frequently asked questions. This small step forward will have a major impact for your team without requiring a ton of time and resources to get started

Truth #2: Quality matters more than quantity.

Given the importance of relevant data in AI, a few succinct paragraphs of accurate information is better than volumes of outdated or conflicting documentation. But even then, don’t sweat the small stuff.

For example, did a product name change fail to make its way through half of your help desk articles? Are there unnecessary hyperlinks scattered throughout? Was it written for live agents versus customers?

No problem — the right Conversational CX Platform can easily address these AI data dependency concerns without requiring additional support from your team.

The Lie: Your data has to be perfectly unified and specifically formatted to train an AI Assistant.

Don’t worry if your data isn’t well-organized or perfectly formatted. The reality is that most companies have services and support materials scattered across websites, knowledge bases, PDFs, .csvs, and dozens of other places — and that’s okay!

Today, the tools and technology exist to make aggregating this fragmented data a breeze. They’re then able to cleanse and format it in a way that makes sense for a large language model (LLM) to use.

For example if you have an agent training manual in Google Docs and a product manual in PDF, this information can be disassembled, reformatted, and rewritten by an AI-powered transformation that makes it subsequently usable.

What’s more, the data used by your AI Assistant should be consistent with the data you use to train your human agents. This means that not only is it not required to build a special repository of information for your AI Assistant to learn from, but it’s not recommended. The very best AI platforms take on the work of maintaining this continuity by automatically processing and formatting new information for your Assistant as it’s published, as well as removing any information that’s been deleted.

Put Those Data Doubts to Bed

Now you know that your data is definitely good enough for GenAI to work for your business. Yes, quality matters more than quantity, but it doesn’t have to be perfect.

The technology exists to unify and format your data so that it’s usable by an LLM. And providing knowledge around even a handful of frequently asked questions can give your team a major lift right out the gate.