Now These Are Numbers You Can Bank On

June 1, 2020

In the midst of the pandemic, DarkCyber noted “How Semantic Search Helps Users Help Themselves.” The write up is from Lucidworks, a company reselling open source engineering support, proprietary software, and other jazzed up solutions. In the write up was a reference to an IBM document. The idea is that the IBM data make a case for buying IBM? Of course not. The data support the contention that semantic search is like training wheels on a toddler’s bicycle.

What are these magical data? First, the data come from an IBM blog post dated October 17, 2017. That’s a couple of years ago. Change does happen, doesn’t it?

Check out these numbers:

  • Businesses spend $1.3 trillion on 265 billion customer service calls each year
  • Phone interactions cost around $35-$50
  • Text chat costs about $8-$10 per session
  • It is realistic to aim to deflect between 40% – 80% of common customer service inquiries to automated frameworks.
  • A drop in per-query cost from $15-$200 (human agents) to $1 (virtual agents)

What’s the connection to the SOLR centric Lucidworks? The company wants to convince prospects that it has the solution known as chatbots. Clever phrase for what is a cost reduction play. Do chatbots work? That depends on whom one asks.

The good thing about chatbots is that they don’t create Rona hot spots. The bad thing is that most of the chatbots don’t work particularly well.

The IBM data, even though old and not in step with the Rona business climate, suggest that the on going cost of helping a “customer” deal with a product and service is brutal. Combine these here and now costs with the technical debt of informationized products and services and what do you get?

The short answer is that one has to have quite a bit of money to keep the good ship technology afloat.

Even Google-type companies, faced with sky rocketing costs and a dicey economic environment, are having to make money saving changes.

Net net: The happy talk about super duper technologies often creates cost black holes. What about IBM? Layoffs and ultra hedgey forecasts. What about Lucidworks type outfits? Wow. Much sales work ahead.

One suggestion? Watch those assertions and one’s cost accounting. Can one “help oneself”? Absolutely, maybe.

Stephen E Arnold, June 1, 2020


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