The AI Attrition Apocalypse is Nigh!
What's the sound of the loss of 700 outsourced jobs to GenAI? A sigh of relief from in-house staff at Klarna that it's not their loss — yet.
Klarna leadership's authenticity about the transformation of the workplace is informed, articulate, and authentic; nevertheless, it does not bode well for the labor market.
The Klarna Interview
The advent of generative AI has profound implications for industries, particularly those that rely heavily on customer service. The jobs most vulnerable to AI are those that require minimal face-to-face interaction and are often outsourced.
Klarna has integrated AI across its operations, most notably with an AI chatbot that reportedly does the work of 700 customer service agents, according to CBS News.
Klarna’s customer service agents, for instance, are outsourced and not direct employees. The introduction of the AI chatbot has led to a reduction in the need for these agents. On average, Klarna required 3,000 agents. The AI chatbot has decreased Klarna's need to just over 2,000.
The AI chatbot handles two-thirds of Klarna’s customer service chat inquiries. It matches human performance in terms of customer satisfaction and has resulted in a 25% reduction in repeat inquiries from customers.
This shift is not a future prediction; it’s happening now. Klarna’s CEO, Sebastian Siemiatkowski, has been transparent about the company’s use of AI and its impact on employment. He emphasizes that the introduction of the AI chatbot is not related to the layoffs Klarna conducted in 2022.
The implications of generative AI for the industry are far-reaching. While it can lead to job displacement, particularly for outsourced roles with little face-to-face interaction, it can also enhance efficiency and customer satisfaction.
Authentic to a Fault
I call out Authenticity as an attribute of the SCAAM checklist for effective corporate Change communications. It's one of the "A"s in the acronym: Simplicity | Consistency | Audience | Authenticity | Medium (is the Message).
I write in detail about Authenticity in Change in the Digital Luddite article "Leadership Authenticity and Change in the Time of Gen AI."
Siemiatkowski's authenticity in this context is bracing — especially for a CEO. One typically expects the quarterly gobbledygook executives deliver shareholders in earnings calls.
Available through CosimoPublishing.com in digital and Amazon Kindle.
"…It showcases strategic insights and provides a good foundational knowledge on how to leverage AI ..." — Nils B., Entrepreneur
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Instead, Siemiatkowski is plain and transparent about the current effects of GenAI on staff. He indicates how it will affect his outsourcing partner.
He also touches on how GenAI will shape the hiring and firing plan for the company in the foreseeable future.
The authenticity will make Change in the organization just that much smoother than if the CEO had prevaricated about the impact of the new technology on the company.
Worker Implications
As Siemiatkowski points out in the CBS interview, it’s crucial for society to start thinking about this major change.
Perhaps changes may not happen through layoffs, but through gradual attrition: companies will simply close their doors to all but the most specialized hires, and allow current staff to leave of their own accord.
The C-level would see staff roles decrease, providing quarterly improvements on bottom-line numbers; PR departments could sing the praises of corporate leadership instead of fending off accusations of profit-driven decision-making.
And Tech bros could crow about the extent to which they've improved the productivity and lives of survivors of the Attrition Apocalypse.
Everyone's a winner!
Except the voiceless.
William Dodson works with Corporate Directors to troubleshoot problematic Change Management programs. He is the architect of the REAP|Change™ framework for AI-driven workplace change management.
He is a former Organizational Change Management senior consultant for PriceWaterhouseCoopers, BearingPoint, Computer Sciences Corporation, and Cap Gemini-Sogeti.
His most recent books include:
"Artificial Intelligence for Business Leaders: The Essential Guide to Understanding and Applying AI in Organizations" (2023, Cosimo Publishing, LLC), 100 pp. ISBN 979-8-9884070-7-2. In digital format and Amazon Kindle.
"The New 'Teacher's Pet': A.I. Ethical Dilemmas in Education and How to Resolve Surveillance, Authenticity, and Learning Issues" (2023, Cosimo Publishing, LLC), 77 pp. ISBN 979-8-9884070-8-9. Kindle edition.
"Virtually International: How Remote Teams can Harness the Energy, Talent, and Insights of Diverse Cultures" (2021, Emerald Publishing Group) , 168 pp. ISBN: 9781801171915.
Message him on LinkedIn about your Change Management and related corporate communications issues and concerns.
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