AI Customer Service: Klarna, Sierra, Decagon and BPOs — 2026-09-11

Top developments

HSBC: No AI-driven collapse in Philippine BPO sector

Contrary to widespread predictions that AI would decimate the Philippine business process outsourcing (BPO) industry, HSBC Global Investment Research reports that the sector remains resilient with employment continuing to grow. The bank notes that AI tools are currently accelerating productivity rather than causing widespread job losses, with services exports increasing. This data challenges the narrative of immediate displacement in call centers, suggesting a transition phase where human oversight remains critical alongside automation.

Gartner: 50% of AI-cut customer service roles to be rehired by 2027

Gartner has updated its forecast, predicting that by 2027, half of the companies that reduced customer service headcount due to AI will rehire staff for similar functions, often under different job titles. The firm highlights that using AI primarily as a cost-cutting tool frequently backfires in enterprise settings, leading to "layoff remorse." By 2029, at least one in three positions eliminated by AI is expected to be restored, typically at a higher cost to the company. This reinforces the trend seen in Klarna’s reversal, where full replacement proved unsustainable.

IBPAP cuts 2028 revenue target to $50.5 billion

The Information Technology and Business Process Association of the Philippines (IBPAP) has revised its 2028 revenue target down to $50.5 billion, acknowledging AI as a "real but manageable" force reshaping the industry. While not viewing AI as an existential threat, the association is actively pivoting to reduce dependence on the US market and is broadening its focus to other regions. This adjustment reflects a strategic recalibration of growth expectations in the face of automated routine tasks.

Zomato closes Hyderabad support center; 250 jobs lost

In India, food delivery giant Zomato has shut down its customer support center in Hyderabad, resulting in the termination of approximately 250 employees. Reports indicate this decision was driven by the integration of AI technologies into their customer service operations. This move highlights the immediate impact of AI on entry-level support roles in India's tech hubs, even as broader white-collar hiring shows mixed signals.

Local view

India: Local media reports a bifurcation in the job market. While traditional BPO roles face pressure, The Print highlights that AI is creating "lakhs" (hundreds of thousands) of new, low-paying jobs in Gurugram and Noida, specifically for data labeling and AI training—effectively creating a "new BPO" layer. Conversely, Hindi-language outlets like Moneycontrol warn that major players like Microsoft and Uber are accelerating automation, posing a significant risk to Indian call center workers. News Track cites a Nomura report noting that AI-related hiring in India has outpaced job losses, particularly in banking and finance, suggesting a shift in skill demand rather than pure elimination.

Philippines: The Department of Labor and Employment (DOLE) is launching an upskilling initiative targeting 10,000 BPO workers this year to adapt to AI-driven changes. Stakeholders view the technology as a tool for productivity enhancement rather than just replacement, with the government focusing on digital upskilling to maintain the country's competitiveness in the global IT-BPM sector.

Context & numbers

• Philippine GCC Employment: Global Capability Centers (GCCs) in the Philippines are projected to employ 289,000 professionals in 2026, up from 270,000, indicating a shift toward higher-value tech functions.
• Intercom Fin Pricing: Intercom’s AI agent, Fin, is priced at $0.99 per resolution when running standalone on platforms like Salesforce or HubSpot, without requiring Intercom seats.
• Resolution Rates: Intercom cites an average resolution rate of approximately 71% across its customer base. In contrast, competitors like Sierra and Decagon do not publish their resolution rates publicly.
• Decagon Pricing: Decagon contracts are structured around a ~$50,000 annual platform fee plus usage, with negotiated per-resolution rates reportedly around $0.50.

On the radar

• Gartner's 2029 Projection: Monitor enterprise announcements regarding "rehiring" under new titles such as "AI Supervisor" or "Customer Experience Specialist," which Gartner predicts will become common as companies correct over-aggressive automation strategies.
• IBPAP Diversification: Watch for IBPAP’s specific initiatives to expand into non-US markets following their decision to look "beyond US" for future growth, potentially altering the geographic mix of Philippine BPO clients.