WHAT IS AN IVR

SYSTEM AND HOW

DOES IT WORK?
An Interactive Voice Response System (IVR system) is likely to
be your company’s first point of contact for inbound callers. The
IVR system allows inbound callers to access help through a set
of self-service options or to be routed to a live agent for real-
time assistance either through either touch tone (“Press 1 for
service”) or automatic speech recognition.
IVRs are designed using one or more dialogs which control the
flow of the conversation with the caller. An IVR system can
communicate with callers by either playing pre-recording voice
prompts or using text- to-speech which reads text using an
automated voice. IVRs can also collect information from callers
through speech recognition or DTFM touch tone.
Dialogs can be designed to engage a caller in a conversation to
provide information or self-service. For example, a caller could
ask for her account balance or request to transfer money from
one account to another. Normally, callers can also ask to be
connected to a live agent for more personalised service.
Typically, dialog designers maintain standard options for callers
to request live help, either by pressing zero or by saying
“operator”.
IVR systems can also answer calls placed to multiple phone
numbers. Dialed Number Identification Service (DNIS) can be
used to determine which number was dialed and then launch
the appropriate IVR application. IVR systems are used primarily
for handling inbound calls but can also be used in outbound call
centres.
HISTORY OF IVR
As call centres grew in popularity starting with the advent of the
ACD in the 1970s, IVRs also became increasingly valuable to
call centres. Initially, they helped organisations collect
information that could be used to route calls to agents through
the ACD. As they matured, businesses began to use them to
provide self-service options to callers thereby replacing human
operators. Operator replacement become an important driver of
adoption as call centres started handling a growing volume of
inbound calls and the number of people required to answer
those calls increased. However, early IVRs were complicated to
program and configure, requiring IT staff to implement and
maintain.
Life became much easier for call centre managers as a new
generation of IVR development tools were released that allowed
non-technical users to create dialogs using visual, drag and
drop interfaces. Initially, vendors developed proprietary
tools that allowed customers to build IVR scripts that were only
support by the vendor’s IVR platform.
VOICE USER INTERFACES
As speaker independent speech recognition was released
commercially in the late 1990s, IVR platforms began to augment
DTMF touch tone interfaces with rudimentary voice interfaces
(“Press or say one to be connected to sales”). The IVR
application would place an API call to a speech recognition
server whenever they needed to interpret a spoken utterance.
 The speech recognition server would then return a result in a
digital format that the IVR system could process.
VXML
The VoiceXML forum was founded in 1999 by a group of
companies including AT&T, Lucent, IBM, Motorola and Nuance
Communications. The group developed the VoiceXML standard
which was later contributed to the W3C. The goal of VoiceXML
was to build a standard language based on familiar XML
markup which allowed voice dialogs to be built that could run on
any platform that supported the VXML standard. The standard,
based on a widely understood XML web development paradigm
increased the number of voice developers and applications.
IVR ANALYTICS
Companies that seek to get the most out of their IVR systems
track the performance of their IVR and continually tune their
applications for maximum performance. Given the volume of
calls handled by modern IVRs, even small improvements can
offer significant benefits. Some common KPIs include:
 Customer displacement rate – The percentage of calls fully
processed by the IVR without agent intervention.
 Customer drop-out rate – The percentage of calls that
leave the IVR and require agent assistance.
 ASR recognition rate – Measures the accuracy of the
speech recognition engine.
 Average time in IVR – Time callers spend in the IVR.