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Interactive voice response (IVR) is a technology that allows humans to interact with computers using voice or a dual-tone multifrequency (DTMF) signaling keypad. IVR allows customers to find answers to their own inquiries by speaking (using the company’s speech recognition software) or giving inputs via a telephone keypad.
IVR uses prerecorded and dynamically generated audio to interact with customers. The key benefit to IVR systems is that they can handle large volumes of calls, where only simple interactions are required.
IVR is also known as a telephone menu or voice response unit.
At the 1962 Seattle World’s Fair, Bell System introduced the first telephone capable of dialing area codes using dual-tone modulation frequency with dial tones in the range of human hearing. This was the genesis of IVR. However, IVR technology was complex and expensive through the 1970s.
In the 1980s, more companies entered the market. Competition led to further development of speech recognition software, causing the move from digital signal processors to a client/server architecture. Companies began researching computer telephony integration for use with IVR systems. Intelligent routing of calls to appropriate company personnel or departments became common and vital for efficient business answering operations. In the 2000s, speech recognition software was further developed and eventually became less expensive. This was made possible by faster processing speeds and the transfer of speech recognition proprietary programming code to the VXML standard.
IVR prioritizes customer calls coming into a call center, moving some to the front of the queue. Prioritization is based on the reason for the call and on a dialed number identification service. The system can also log caller detail information and collect it in a database for auditing, system performance analysis and future system improvements.
Other typical uses for IVR are:
IVR technology has its critics. Callers may object to providing voice responses to automated systems and prefer to talk to a human respondent. Customers may feel frustrated when their ability to talk to a human is restricted.