Bengaluru-based startup Dukaan last year terminated around 90% of its customer support team and substituted them with an artificial intelligence (AI) chatbot.
The company’s founder and CEO, Suumit Shah, disclosed this decision on Twitter, citing a primary focus on profitability.
Shah defended the move by revealing an 85% reduction in customer support costs, accompanied by a significant decrease in resolution time from over two hours to a mere three minutes. Regarding the development, he had posted,
“We had to layoff 90% of our support team because of this AI chatbot. Tough? Yes. Necessary? Absolutely.”
He further added,
“The results? Time to first response went from 1m 44s to INSTANT! Resolution time went from 2h 13m to 3m 12sn Customer support costs reduced by ~85% Here’s how’s we did it.”
Despite facing criticism for the decision, Shah remained resolute and concurrently announced the company’s plans to hire for various roles. In another candid post, we noted,
“Given the state of economy, startups are prioritizing “profitability” over striving to become “unicorns,” and so are we. It’s less magical, sure, but at least it pays the bills!”
About Suumit Shah
Suumit Shah is the co-founder and CEO of Dukaan, a do-it-yourself (DIY) platform enabling merchants and retailers, including those lacking programming skills, to establish their e-commerce stores. Launched in June 2020 with Subhash Choudhary as the co-founder and CTO, Dukaan represents Shah’s latest venture in a series of entrepreneurial pursuits.
Prior to Dukaan, Shah founded Rankz.io in 2018 and Risemetric in 2014, showcasing his prowess as both an entrepreneur and product designer. Originally from Mumbai, Shah holds an engineering degree and augmented his education by taking various online courses.
His professional journey includes stints with prominent corporations such as McDonald’s and Cred, along with roles at Housing.com and TinyOwl, where he served as a Digital Marketing Manager.
Shah’s entrepreneurial spirit led him to establish Risemetric with his friend Subhash, followed by the founding of Rankz.io in 2018.
About the platform
Dukaan is a platform designed to empower local businesses and stores by providing them with a simple and accessible way to establish a digital presence and sell their products online. Founded by Suumit Shah, Dukaan caters to businesses looking to transition to the digital realm without requiring extensive technical knowledge.
The app allows local store owners, referred to as “dukandaars,” to seamlessly go digital by downloading the Dukaan app, completing a quick business registration process (which takes less than a minute), and listing their products. Dukaan’s innovative approach leverages the widespread use of WhatsApp, a familiar and widely-used messaging platform.
Store owners can share the link to their Dukaan store via WhatsApp, enabling direct orders from customers.
The platform’s brilliance lies in its user-friendly interface and its ability to bridge the digital divide for businesses not well-versed in technology.
By utilizing the familiarity of WhatsApp, Dukaan facilitates the transition to online selling for local businesses, offering them a convenient and efficient way to reach customers in the digital marketplace.
Summit’s Reasoning
Suumit Shah holds the belief that individuals with technical and product expertise should not be working in customer support roles, drawing an analogy to a scenario where a football star like Lionel Messi would take on a full-time job at a sports retail store like Decathlon. He acknowledges that while the theory may have some merit, it is fundamentally flawed.
Expressing his limited knowledge of artificial intelligence (AI), Shah mentions that, until recently, his understanding of AI was equivalent to just knowing the full form of the term. Despite this, he found the concept of an AI assistant intriguing for Dukaan, envisioning a system that could instantly and precisely answer customer queries anywhere.
Dukaan’s CEO elaborated on the development process of the AI chatbot, highlighting the work of Dukaan’s Lead Data Scientist, Ojasvi Yadav. According to Shah, Yadav created a working demo of the chatbot that could efficiently handle common questions about Dukaan.
Over time, the chatbot evolved to address both generic and account-specific queries, leading to the christening of the AI assistant as “Lina.”
Despite Suumit Shah’s enthusiasm about the capabilities of the AI chatbot and its positive impact on customer interactions, the decision to replace human support staff with artificial intelligence has sparked backlash. Critics argue that the public celebration of the decision, coupled with potential negative consequences on customer support, is a cause for concern.
The backlash received
The reaction to Suumit Shah’s announcement of firing the customer support team and implementing an AI chatbot at Dukaan has been largely critical on Twitter.
Some users on the platform expressed skepticism about Shah’s motivations, suggesting that the move to AI might be a smokescreen to divert attention from underlying issues such as poor business performance and a lack of funding.
One Twitter user issued a cautionary note to young startup enthusiasts, asserting that the decision to lay off the support team wasn’t driven by a commitment to AI but rather by the business facing challenges and experiencing financial constraints. There is a level of mistrust among some observers, questioning the stated reasons behind the drastic decision.
The backlash appears to stem from concerns not only about the potential impact on customer service quality but also about the transparency and honesty of the company’s communication regarding the strategic shift.
Critics challenged the narrative presented by Suumit Shah and demanded clarity and honesty when making significant decisions that affect both employees and customers.
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