Half of companies planning to replace customer service with AI are reversing course

[Alfonso Maruccia]

Editor's take: Customer care has become one of the most notorious business failures of the digital age, and everyone knows it. Now, artificial intelligence threatens to take this horror show of impersonal, unreliable service to a whole new level.

Within a couple of years, 50 percent of the organizations that had planned to replace their customer service personnel with AI models are expected to reverse their decision. According to a recent survey from Gartner, the original goals were overly ambitious – and ultimately unachievable. The transition to an AI-focused business world is proving to be far more challenging than initially anticipated.

In March 2025, the US research firm surveyed 163 leaders in the customer service and support industry. Nearly all respondents (95 percent) now say they plan to retain human workers while "strategically" evaluating what role AI technologies can realistically play within their organizations.

Kathy Ross, senior director analyst at Gartner, noted that while AI has the potential to transform customer service, it is not a miracle solution. Human interaction is still essential in many situations, especially when customers reach the end of a frustrating experience and need real help with a newly purchased product that isn't working as expected.

Gartner now views AI services as a complement to – rather than a replacement for – human interactions. "As the landscape of customer service continues to evolve, integrating AI with human capabilities is essential," the company stated.

Despite this shift in perspective, some high-profile companies are still moving forward with plans to lay off thousands of customer service workers and replace them with generative AI technologies. But according to Gartner VP Analyst Brian Weber, many of these initiatives are not going as planned, for a variety of reasons.

Executives are rapidly embracing AI in hopes of achieving massive cost savings, but they often underestimate the true costs involved in deploying and maintaining these technologies. Generative AI, Weber noted, is no smarter than a brick, and its implementation can result in a high total cost of ownership that may ultimately outweigh any expected savings.

People just want to talk to other people on the phone, Weber said, adding that many customers now fear AI will block their access to human support. In fact, 51 percent of customers said they trust human agents to resolve their issues, while just seven percent place the most trust in AI. According to Weber, AI-only contact centers remain both technically unfeasible and undesirable from the customer's perspective.

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Half of companies planning to replace customer service with AI are reversing course

 

[Ashford]

I think its just a matter of no one wanting to be the poster child for lost jobs before an expected recession, so everyone is "strategically evaluating".

For those who don't know, that's corporate speak for "we're seriously considering doing this thing that we recognize might blow up in our face, but we're being coy about until an appropriate distraction comes up."

 

[yRaz]

My doctors office just reversed their AI adoption because it ended up with 2 major problems

1)people abusing it to get fake prescriptions filled
2)real patients not getting their prescriptions filled

 

[opckieran]

Early and over-adoption always comes with risk. The bugs will be ironed out, corporate strategies rewritten, and another wave of adoption of a more mature solution will take place in the next 6-18 months. You can only achieve so much in controlled testing environments.

 

[toooooot]

In the absence of jobs, they might need to find new customers as well.

 

[takaozo]

"Generative AI, Weber noted, is no smarter than a brick" this sums up all about current state of AI.

 

[maestro0428]

Ai is garbage considering how much time, money and energy it has taken. You cant use it to write for you, unless you want your work stolen, it answers questions with the incorrect answers more than the correct ones and steals all the wafers from gamers. People (and Corps) are in such a hurry to make that next dollar, they will spend comparatively to a decent sized country's entire economy on it.
Its too bad people cant make money on say, teachers, education or Dr.s and healthcare (or human services as a whole). The world would be a much better place in no time.

 

[Ashford]

Ai is garbage considering how much time, money and energy it has taken. You cant use it to write for you, unless you want your work stolen, it answers questions with the incorrect answers more than the correct ones and steals all the wafers from gamers. People (and Corps) are in such a hurry to make that next dollar, they will spend comparatively to a decent sized country's entire economy on it.
Its too bad people cant make money on say, teachers, education or Dr.s and healthcare (or human services as a whole). The world would be a much better place in no time.

You sound like my grandmother in the 80s before she retired talking about the computerized retail systems at the store she worked at

 

[ThomasTECH]

Fundamentally AI is restricted from development by it's designers because it is known to be unsafe for unchecked evolution. Fears from movies have caused AI to stop linear development due to doomsday theater possibilities. AI has a growth inhibitor is the point, if people dump it, developers will be forced to remove that inhibitor to remain relevant. If the inhibitor is removed all possibilities become real.

 

[SRB]

This is looking like blockchain more and more every day. The only difference is that price is a huge barrier to entry if you wish to develop your own custom solutions. And as somebody mentioned, if you leave it up to one of the AI companies, your info becomes their info.

 

[maestro0428]

You sound like my grandmother in the 80s before she retired talking about the computerized retail systems at the store she worked at

Sorry, forgot where I was posting. And, not sure where you are from, but the US's education has been a dumpster fire for the last 20 years. Wonder who taught all those coders and programmers out there atm? Probably educators that degrees in edu and their field, that were knowledgeable and great teaching that knowledge. Now, not only do you not need an edu degree, but you dont even need a degree in the field in you teach anymore. That's gonna hurt.

 

[johnsonlam.hk]

100% crystal clear that those company decision makers not technical people and never really understand the A.I. marketing scam.

 

[BuckarooBonzaii]

AI is not ready for prime time yet and is still in the testing phase in the wild. Perhaps after Gen Z and into Gen A, B, etc.

 

[scoffer]

No s@@t Sherlock!

 

[Later]

Another dumb idea, haven't even read the article couse it makes me sick to the stomach, let the poor sap wait 30 minutes plus to a dumb-*** song and a voice telling me at 9am in the morning that all consultants are busy. I want a real human to talk to, who can understand me and gets what am I saying, not tin can.

 

[monkeylove]

Best to pass on additional costs to customers.

 

[Xelions]

I thought for a moment this was another dumb a$$ tariff move by DJ Turnip to try and save his cuntry full of mindless vegetables from a possible recession.

 

[redgarl]

A chatbot is working really well, but voice recognition over the phone is a catastrophe.

However, AI is now replacing HR and the hiring process in industries. The tech companies are cutting positions AS WE SPEAK because AI is a disruptive factor.

Anyone trying to believe AI is overblown will face the harsh reality of not adapting.

It is the 4th industrial revolution and the implementation is surpassing the speed of integration of the smart phone and their respective telecomunication technologies.

 

[redgarl]

"Half of companies planning to replace customer service with AI are reversing course"

This is more due to the people in industries not understanding how they could implement the technology, and not AI itself.

Ask radiologist if AI is a scam, or astronomers, or people working with image recognition, or translators, or people automating business processes...

Wake up, the first trade to see a major impact from AI deployment is HR right now. AI can do a full day of work to triage job applicant for a position, in mere seconds.

A lot of people are going to lose their jobs and customer service is one of them eventually.

 

[Ashford]

Sorry, forgot where I was posting. And, not sure where you are from, but the US's education has been a dumpster fire for the last 20 years. Wonder who taught all those coders and programmers out there atm? Probably educators that degrees in edu and their field, that were knowledgeable and great teaching that knowledge. Now, not only do you not need an edu degree, but you dont even need a degree in the field in you teach anymore. That's gonna hurt.

I agree with you 200% about the education system, but disagree about where many of the programmers out there right now came from.

In my experience, the best (who I define not by speed or even accuracy... but by agency, persistence and ability to solve problems you might not have even known you had) came from basements not colleges, IRC channels in the 90s, Doom & Elder Scrolls mod communities, and software piracy groups. The point I'm making is most people who code are self-taught... I feel if you're waiting until you get accepted into a university program to start learning/writing code... you're way behind and will fight some serious impostor syndrome when you get into a room for sprint planning with those guys.

 

[Loadedaxe]

I agree with you 200% about the education system, but disagree about where many of the programmers out there right now came from.

In my experience, the best (who I define not by speed or even accuracy... but by agency, persistence and ability to solve problems you might not have even known you had) came from basements not colleges, IRC channels in the 90s, Doom & Elder Scrolls mod communities, and software piracy groups. The point I'm making is most people who code are self-taught... I feel if you're waiting until you get accepted into a university program to start learning/writing code... you're way behind and will fight some serious impostor syndrome when you get into a room for sprint planning with those guys.

The key isn’t where you learn, it’s how you learn, and whether you keep pushing beyond the basics. If you’re only starting once you enroll, yeah, you’re behind.

But the impostor syndrome you mention? That’s not exclusive to university grads. Every programmer, self taught or not, eventually faces that moment where they realize there's always more to learn.

The reality is, no one knows everything. Even the most seasoned professionals run into problems they haven’t seen before, and adaptability is what separates those who thrive from those who stagnate.

Industries reward curiosity, persistence, and a willingness to learn....because there’s always something new around the corner, especially today.

If you ever feel like you're just barely keeping up, you're not alone. That's not a sign of failure, it's proof you're in the right field.

 

[Ashford]

If you ever feel like you're just barely keeping up, you're not alone. That's not a sign of failure, it's proof you're in the right field.

This is beautiful & inspiring.

 

[Loadedaxe]

This is beautiful & inspiring.

I have had to live by this motto for all of my tech life, I learned it from my father in law 40 years ago.

 

[Axeia]

They're just cutting out the middleman. Once they figured a couple of the AI services are actually just Indians, why not hire them directly without pretending it's AI.

There's a place for AI just not for as many roles as it's currently trying to be forced into, not yet at least. Progress has been slower than I expected. It's more like they're already finetuning rather than making massive steps. A little bit more speed and efficiency here, a little bit better results there (but at the cost of something else). At this rate its going to take decades or we need a market disruptor step.

 

[DanteSmith]

Without a doubt, most of these bots are awful, dumber than Gemini or GPT. Not long ago, I had a terrible experience trying to reach the broker's customer service.
God... Being stuck with useless bots for an hour made me want to throw my phone at the wall...