According to the CEO of Klarna, AI has the potential to replace the work of 700 employees. However, the main concern is not about job replacement.
Klarna, a fintech company that facilitates online transactions for well-known brands such as Expedia, Macy’s, and Nike, is at the forefront of implementing AI technology. The company has successfully integrated artificial intelligence into its operations, particularly through the use of an AI chatbot that has the equivalent productivity of 700 human customer service agents. In a recent release, Klarna shared statistics showcasing the effectiveness and efficiency of this tool, sparking important discussions about the use of generative AI in business, human interaction with the technology, and its potential impact on the future of work. CEO Sebastian Siemiatkowski opens up about his decision to be transparent about AI’s capabilities and shares his concerns about this new technology. This interview has been edited for brevity and clarity.
Bloomberg
The topic of AI replacing human jobs is controversial. What motivated you to publicly disclose Klarna’s implementation of AI in replacing customer service agents?
We have concerns about the overall impact on society, which is why we are being transparent about the positive results it has brought to our customers.
Tips for overcoming AI screening and getting your resume seen by a human.
Is this not connected to the job cuts that Klarna implemented in 2022? Did AI not replace those positions?
In 2022, due to a shift in investor outlook, we were compelled to downsize our company. Approximately 800 employees were let go, none of whom were customer service representatives. Presently, two years later, we are exploring the potential of a fascinating technology we’ve created, ChatGPT. These are two distinct matters that have been intertwined.
changes in our operating system
In the immediate future, there will be no modifications made to our operating system.
Termination or impact on staff membersCustomer service chatbot AI was launched, resulting in notifications and comments being returned.
What is the function of the chatbot? How is its performance evaluated?
This program deals with 66% of our chat inquiries for customer service. Its satisfaction rate is similar to that of humans and has led to a 25% decrease in repeat inquiries from customers.
Prior to launching, we utilized a co-pilot to assist customer service representatives and other staff members in increasing their productivity. This artificial intelligence is capable of independently communicating and resolving customers’ concerns. We believe it’s crucial to offer the choice of speaking with a human, however, we have observed high satisfaction and effectiveness amongst those who interact with the AI chatbot. It has the ability to converse in 35 languages, significantly improving the experience of immigrant and expat communities.
In big companies, more attention is given to tasks that don’t necessarily benefit employees, clients, or investors. However, with the use of AI, unproductive tasks can be eliminated. Ideally, every individual joining the organization will be able to utilize their imagination to add real value for clients rather than focusing on impressing the CEO with presentations. This type of work, while important, is not the main contributor to value creation, and I intend to reduce its significance.
Are you concerned about potential mistakes or inaccurate information being delivered?
We must acknowledge that humans, while amazing, are not flawless. They are prone to errors due to lack of attention or training, and not always to blame. This is especially true when handling a large volume of customer inquiries, as not all responses will meet our desired standards.
Our primary measure is ensuring that the AI makes fewer errors on average compared to human performance. This is our goal and we have closely monitored it. We ensure that the mistakes made by the AI are less significant and occur less frequently.
Has the use of AI changed the way you approach hiring, or has it not affected it at all?
In the past six months, we have ceased hiring and our company is decreasing in size due to natural employee turnover, not job cuts. Klarna is incorporating AI into all aspects of our products and services and this is affecting our staffing needs. For the first time, an improvement in one product has significantly decreased the demand for customer service agents.
What is the sentiment of your employees regarding this matter?
Although it may be difficult, it is important to openly address this issue and inform the public about it due to its potential impact on society. We have also been internally discussing this matter with our employees since we stopped recruiting in October, as we believe it will lead to increased efficiency.
Our goal is to increase our investment per employee and to raise the compensation of current employees as our company grows in revenue.
Many employees within the company are enthusiastic about implementing AI at Klarna, a renowned AI company. This makes our workforce more appealing to potential employers.
Can you please explain how you arrived at the $40 million cost savings estimate for Klarna with regards to AI?
We had been purchasing customer service from suppliers in order to handle inquiries. We had set aside a budget for how much we planned to spend on those suppliers this year. However, with the help of technology, we will now be spending significantly less. The difference between our expected spending and our actual spending will be 40 million.
What do you believe will be the greater consequences of AI on society?
Our intention in sharing this information is to raise the question to society as a whole regarding how we plan to handle this significant transformation.
Based on information received, the main concern is not so much job stability but overall security. In other words, validating our humanity through electronic identification to ensure authenticity in communication.
Also, while by 2020
In 2020, there is potential for the creation of new jobs related to AI.
On a societal scale, this is not a solution for the individual who is being replaced by artificial intelligence.
The more we can provide support for individuals who may experience its impact, the more beneficial the outcome will be for our society. Rather than trying to prevent it, the focus should be on determining ways to help those impacted by it. The question we should be asking is, “How can we assist those affected by this?”
Megan Cerullo
Source: cbsnews.com