Conversational AI Report


Don't call it a chatbot, they've been here for years...


Seriously, call 'em chatbots, conversational AI, or fancy experience and productivity tools. It really doesn't matter if you don't understand the role of the tech and the solution to your everyday problems.


ENTER the 2021 Conversational AI Report by friend of the show Madeline Laurano and Aptitude Research. During this podcast we dig into some major points and tease others.


We ask:

  • Isn't this tech already part of our everyday routine?

  • Can conversation AI be more than a point solution?

  • Is conversational AI more than a high-volume play?

  • Can the ATS and CRM platforms even compete?

Again, Madeline has pulled together amazing intel that every Talent Acquisition, Recruiting, and Human Resources professional should download, digest, and share with their teams.


Enjoy the overview, brought to you by those wonderful kids over at Sovren.com. Sovren, was into parsing and AI matching before it was cool. Sovren, AI so human you'd like to take it to dinner.


PODCAST TRANSCRIPTION sponsored by:

Disability Solutions is your bridge to the disability community, delivering custom solutions in outreach, recruiting, talent management and compliance.


Sovren (2s):

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INTRO (1m 1s):

Hide your kids! Lock the doors! You're listening to HR’s most dangerous podcast. Chad Sowash and Joel Cheeseman are here to punch the recruiting industry, right where it hurts! Complete with breaking news, brash opinion and loads of snark, buckle up boys and girls, it's time for the Chad and Cheese podcast.


Chad (1m 22s):

Ah, that's right kids. Hey, what's up? It's Chad and I'm joined today looking bastards by Madeline Laurano founder at Aptitude Research. What's going on Madeline?


Madeline (1m 36s):

Hey Chad, thanks for having me back.


Chad (1m 38s):

Thanks for coming back. I wasn't sure if you'd come back or not.


Madeline (1m 43s):

No, always been busy, busy writing so excited to talk about some of the new research. I mean,


Chad (1m 47s):

You've come on. And we've talked about the ATS report. We talked about the programmatic report and you've got a new report that just came out. Which one is this?


Madeline (1m 56s):

This is conversational AI. And we started this report last year, we published one around July 2020, during the pandemic and now we revisited the topic this year. So I'm pretty excited about this one.


Chad (2m 9s):

Conversational AI kids. It doesn't get it doesn't get sexier.


Madeline (2m 14s):

No, it doesn't.


Chad (2m 16s):

Let's do this, before we get into the actual report and we start teasing it a little bit. Madeline, just in case our listeners have been in the fetal position or in a closet for the entire pandemic. Tell them a little bit about yourself.


Madeline (2m 30s):

Sure. So Hi everyone. My name is Madeline Laurano. I'm the founder of Aptitude Research. We do research advisory on HCM and all things, talent acquisition technology.


Chad (2m 40s):

Excellent. Excellent. So this report has a ton of takeaways, but we're going to only tease a few because people need to, they need to dig into this in total. I've gone through it. It's amazing. It's only 24 pages, which is awesome. It's a little bit easier to get through than the applicant tracking system, 150,000 pages, which was awesome as well, but great charts, graphs, graphics. So everyone listening and your teams should definitely download it, read it, digest it and talk amongst yourselves. So ready to jump in?


Madeline (3m 15s):

I'm ready.


Chad (3m 19s):

All right. So one of the points I want to get to is that the report talks about conversational AI is already prevalent in our every day lives. It shouldn't be something that, you know, we find obtrusive or intrusive or because we already use it.


Madeline (3m 36s):

Yeah. We use it in our personal lives. I think this is very different than other areas of, I mean, it's different than our programmatic conversation. I don't use programmatic in my personal life, but the conversational AI is something we use every day. We're using Alexa, we're using Siri. You know, our weather app is powered by conversational AI, at least mine is and we're used to it. And it's the difference with conversational AI in our personal lives is it's truly an assistant, right? It's like you use the, I need help with something so I'm going to go to Siri or Alexa and ask for help in way that they can support me. And it's that assistant that to me is, is really the differentiator.


Chad (4m 16s):

I love it. I tell you what I, I remember when I was a kid and remember War Games, the show War Games?


SFX (4m 25s):

Shall we play a game?


Chad (4m 28s):

So that wasn't audible where you could actually talk to the computer, but there was an audible kind of like response from the computer. I always waited. I always loved thinking of voice to voice. And now when I'm in the car, I'll tell, you know, my Google assistant navigate me home or navigate here, or I'll ask for, you know, questions for Google throughout the day. And my kids hate it. My kids hate it because they'll come to me, they'll come to me for a question. And I'll pick up my phone and I'll hit my assistant and say, Hey, Google and then I'll ask whatever question they just asked. And they look at me like, okay, I get it. For me, it is a part of it is a part of my life.


Chad (5m 9s):

And I think it's a part of most people's lives. The thing is conversational AI in our space seems to be seen as a point solution. So first off let's provide some context. What point is conversational AI usually cornered into right now? And where are the other points?


Madeline (5m 30s):

Yeah, I think it's usually cornered into the apply process or like the, either the recruitment marketing process or the screening process.


Chad (5m 38s):

Yeah.


Madeline (5m 38s):

It's like, we're just going to use a chat bot. The candidates have issues applying. We want to make sure they get through the process. They're interested in our company. They're interested in applying for a job as a barista, and we want to be able to show them that there are other locations close to where they live, where there are opportunities or the screening process they're going to ask some questions to get through. So that tends be where companies think that's where it comes in, serves a purpose. It's one thing. And that's it. And that's really a chat bot. A chat bot can just tackle that one thing. Conversational AI and the way a lot of companies are using it today is continuous, it's throughout all of talent acquisition, interviewing scheduling interviews, onboarding, helping a new hire say, Hey, we're so excited you joined this organization.


Chad (6m 20s):

Yeah.


Madeline (6m 21s):

Bring your lunch the first day, your manager's on vacation. Like little things like that, you know, people take for granted. So I think even the employee experience, internal mobility are becoming use cases. Yeah. McDonald's we featured them in the report and that's how they use it. It's an end to end.


Chad (6m 36s):

I think companies like McDonald's have been thinking out of the box for using technology for problems, right? And they're looking at problems and they're saying, how can we address them with technology. Conversational AI for them and if you think about it, it is a heavy load to lift, to be able to provide a much better, much faster application experience, which it does. But as you had said, many companies are actually turning conversational AI back onto employees.


Madeline (7m 12s):

Exactly, back to employees, thinking about internal opportunities, thinking about that employee experience. So I think it becomes very interesting and it's, you know, Chad it's and we've talked about this, you know, before this report. There've been acquisitions right? This year, we saw some conversational AI providers get acquired to do very specific things in sourcing or, you know, in kind of this one use case and interviewing, you know, AllyO as an example.


Chad (7m 38s):

We'll talk about that. I promise. So the next one is conversational AI is completely transforming high volume recruiting. So this to me is all about speed, scale and experience. So if any company is doing high volume, are we seeing pretty much, most companies jump into this? And what is the impediment, if they are not?


Madeline (8m 2s):

It's a game changer for high volume. It absolutely is. And I think it's the efficiency, it's the experience, but it's also a competitive advantage. Like if you're going to go apply for a job and it's quick, easy, you have a really cool experience. You already feel like maybe this is a company you want to work for, and you're going to do that and possibly get an offer in a day compared to what that experience. We all know what the apply process looks like in a traditional ATS, and you're gonna lose people and that's what's happening.


Chad (8m 31s):

Yeah, yeah. Yeah. Well, and I've also seen many high volume organizations focus on a couple of different areas and ensuring that that candidate doesn't go into a black hole, number one so they get responses, later with new jobs because it is high volume. So they're constantly looking for people. So you can go back into your database for somebody who just applied, who didn't get the role, but we have a new role, et cetera, et cetera. And also, this I think is huge, is the anti ghosting magic of messaging. Because if you can continue to send messages to candidates who are going to be on their first day, or even their interviewing it doesn't matter, you can keep them engaged.


Chad (9m 16s):

They feel more accountable and responsible for showing up. And we like to look at candidates for why are they ghosting us? But, you know, we, on our end are responsible for ghosting as well.


Madeline (9m 29s):

Yeah. And it's 24/7, right? So it's like that relationship can happen if someone's finishing a shift at midnight and they work in a restaurant and they're interested in another opportunity, they can start engaging with that company at one in the morning. And that's not going to happen if you don't have conversational AI.


Chad (9m 43s):

Yeah, yeah. Speed and scale. And then all the opportunities around that. I think that to me is so compelling, especially for high volume. So what are our next point, I think is a very big point. And you definitely need to read the report and dig deeper into this, but the ATS and CRM markets can't compete. Tell me about this.


Madeline (10m 9s):

I know this is a bold statement. I think a lot of people might not like this view that I have. But I think, yeah, I, you know, it's interesting because there have been some acquisitions that, but very few with real conversational AI, I think Smart Recruiters, acquiring Jobpal is a very smart acquisition that's absolutely conversational AI. But for a lot of the ATSs and CRMs, you know, aside from Smart Recruiters, they've tried to build their own, which is just a chat bot. It's very transactional. It's just loaded FAQ's and, you know, it's kind of one type of communication that they're just not able to build out what some of these other providers are doing better, true conversational AI providers.


Madeline (10m 50s):

So I think for those providers that have tried to build their own, or in that process, they just, it's a huge commitment. It seems like an easy thing, right. It's like, okay, why can't we can all build a bot? How could we not do that? But a true conversational AI is really complex.


Chad (11m 5s):

Yeah. Yeah. From my standpoint, it feels like the market is telling us something different. So stick with me here. So AllyO and Maya received big funding, but yet they couldn't crack the market. Right. Pandologic just bought Wade and Wendy, but was that off the COVID clearance rack? I don't know right? So the question to me is can conversational AI survive outside a core system? AllyO is now inside Hirevue. Maya is now integrating into StepStone's Total Jobs and Wade and Wendy inside Pandologic. So the big question is, yes, they do need that expertise inside the ATS and the CRM and these bigger systems.


Chad (11m 52s):

But for Conversational AI companies, don't, they have to be focused on getting in there quickly because it, from what the market's saying, they can't survive by themselves?


Madeline (12m 3s):

Yeah. And I think for some of these companies took a lot of money before they were probably ready to. And I think that part of it's kind of the growth. I mean, it's an exciting, like you said, it's like the sexiest area of talent, acquisition tech. This is where investors want to spend money. And they got a lot of money before they were probably ready to continue to develop. So I think a lot of it is driven by kind of an exit maybe before they were ready or we would have liked them to exit. I think, where I see the challenges and all of those examples you're then limiting what conversational AI can do. It just becomes a point solution. Right. If you're looking at AllyO, I mean, Hirevue does first interview to essentially onboarding that's where it plays. It's not doing anything top of the funnel. So AllyO can come in and play in the interview spot really well.


Madeline (12m 48s):

If you look at Pandologic, you know, there's a great use cases for using conversational AI, for advertising job advertising and sourcing. I mean, it makes so much sense, but it's limited to that what that vision is. So I think that's, you know, to see this kind of end to end vision, come out, it's going to come from a standalone provider.


Chad (13m 6s):

Yeah. I also believe, this is just my thoughts, that Hirevue needed something more to expand because they're going to have to take on the ATS and the CRM and become a much larger system. The question is, and knowing that right now it's being used as a point solution. Could they not supercharge that conversational AI later and really spur more business? I mean, I that's, I think it's, there's just a huge opportunity that's being missed by most companies, right now.


Madeline (13m 36s):

Yeah. I think so too. And I think it's going to be very interesting because now we're kind of left with very few providers that haven't been acquired yet that are doing very well. Like we know these providers that are, have done very well in the past year, they continue to do well. Companies, enterprise companies are investing in them. Plus these acquisitions that have been made and all of these pieces kind of playing out with, with what's happening. You know, the other thing we could spend, like a whole podcast on this pricing, the pricing has gotten so complicated, right? It's like you go in, you're going to give an ATS deal, a CRM deal. And there's an add-on for conversational AI for the chat bot is an add-on. And are they going to try to compete with the pricing of, you know, some of these standalone providers? It becomes really complicated.


Chad (14m 17s):

It is and that seems like a roadblock. Yeah. What are some of the other roadblocks and or common misconceptions about these solutions?


Madeline (14m 26s):

So I think one, like a very basic one is chat bot versus conversational AI. And we've been talking about this, you know, throughout this podcast, but just at that very basic level, if you're kind of lumping the two together, I think it does a disservice for what the value and the potential is. And we kind of mapped out like the difference that we see one kind of chat bot being very transactional and conversational AI being like an of your team, a true intelligent assistant. And so I think the first thing, if you're interested in conversational AI and you're interested in what these solutions can do, make that distinction, make that distinction between just those loaded FAQ's and a true intelligent assistant.


Madeline (15m 8s):

And I think that's, to me the first roadblock, and then I think the other one is we talked about high volume and that's a game changer, but there are so many companies, very interested financial services, you know, across a lot of different technology or a lot of different industries that are investing in conversational AI in talent acquisition for even to support the recruiters. So it's not the manager led experiences, it's the recruiter led experiences and that's a growing area. And I think for so many people, it's like, oh, that's just good for high volume roles. It's not good for any of our, you know, professional hiring.


Chad (15m 44s):

Yeah, yeah, yeah. And again, the scale and the power, not to mention, you know,throwing all of the acronyms, AI and ML and all that other fun stuff. I mean, this beast needs to learn. So you feed it data signals, right? And that's what the chat bot or the conversational AI does. It feeds the beast with all the signals that you need to be able to make better decisions down the road. One of the things I really believe conversational AI vendors in general are missing the mark in our industry. They're focusing on things like labels that I don't think matters like chat bot versus conversational AI. Rather, they have such powerful solutions stop worrying about that stuff, right?


Chad (16m 28s):

Software. I don't care if I call it a chat bot who cares right? In this report, I love where you outline the impact on businesses. I believe talent acquisition professionals, HR professionals, and vendors. That is where you focus. Don't spend all your time trying to explain a way what AI is, the difference between chat bots and conversational AI and look at some of the things that you did in the report, the impact on business, I believe personally, that's where you focus because in business, I just want to get to the brass tacks. How are you going to help me get through this?


Madeline (17m 5s):

Yeah. Especially this year, right? It's like, everybody is overwhelmed. They feel intense pressure. Like we need help with these five things. These are the five things that we're really struggling with. And to be able to say, okay, this is where conversational AI comes in, and this is how it helps you to solve that. And this is what you're going to see, you know, in that timeframe, because of that, I think that to me, I think you're spot on. That's exactly right. It's just focus on what problems are you solving?


Chad (17m 29s):

That's what I want all of our vendors out in the space to listen, focus on, you know, the actual problems and the solution. So I could sit and talk with you all day about this report, actually just chunks of this report to be quite Frank, but we're going to leave this as a tease. So if somebody wants to download this awesome intelligence, right, where do they need to go?


Madeline (17m 53s):

Yes. Thank you. So they go to aptituderesearch.com. It's right on our homepage. You can also email me Madeline@aptituderp.com and I will happily send you a copy as well.


Chad (18m 3s):

Yes and again, I've been lucky enough to already chew through this. Get it, read it, share it with your team and start to understand the power of technology as you need to scale at speed. This is amazing stuff, Madeline, thank you so much for joining us and have a great weekend.


SFX (18m 25s):

Applause


Madeline (18m 25s):

Thanks. Thanks, Chad. Thanks for having me on you're the first person to see the report other than Paradox sponsored it, so they saw it as well, but you you're the first one to see it. So thanks for reading it. And thanks for having me on.


Chad (18m 37s):

Always, always a pleasure. Appreciate it. We out.


OUTRO (19m 37s):

Thank you for listening to, what's it called? The podcast with Chad, the Cheese. Brilliant. They talk about recruiting. They talk about technology, but most of all, they talk about nothing. Just a lot of Shout Outs of people, you don't even know and yet you're listening. It's incredible. And not one word about cheese, not one cheddar, blue, nacho, pepper jack, Swiss. So many cheeses and not one word. So weird. Any hoo be sure to subscribe today on iTunes, Spotify, Google play, or wherever you listen to your podcasts, that way you won't miss an episode. And while you're at it, visit www.chadcheese.com just don't expect to find any recipes for grilled cheese. Is so weird. We out.

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