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IVR versus ACD: What is the Difference?

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Both interactive voice response (IVR) and automatic call distribution (ACD) can help your business deal with high call volume more effectively. Both automated systems can direct callers to the right employee and also ensure a proper distribution of calls. You must understand the differences between IVR and ACD in order to choose the right solution for your business.

Read on for a detailed comparison of IVR and ACD.

IVR Versus ACD: Definitions

Interactive voice response and automatic call distribution are telephony automation tools that facilitate efficient call management. Both IVR and ACD can answer calls, distribute calls, and assist the callers. Both systems also provide assistance to employees and agents to help boost productivity.

Let’s discuss how these systems work and how they differ from each other.

how does ivr work

How Does IVR Work?

Many businesses use IVR to streamline their business calls and facilitate effective call management. Interactive voice response is a voice menu that automatically answers incoming calls and assists callers. More specifically, an IVR welcomes the caller and offers menu options to identify the purpose of their call. For example, Welcome to [company name], Press 1 for Customer Support, Press 2 for Sales, and so on.

Callers select the option by either entering a number through the dial pad. Then, the IVR directs them to another set of options or transfers them to the right department or agent. In fact, some advanced IVR menus may even allow callers to complete predetermined actions such as:

  • Activate a service or account
  • Process payments
  • Send callers to voicemail
  • Record a complaint
  • Provide company and product info

The IVR system ensures that callers reach the right department or can resolve issues by themselves. In fact, some callers may not even need to interact with an agent or employee. This frees employees up to work on more complicated issues and concerns. It can also help businesses save money on hiring staff as customers can resolve most issues on their own through the voice response system. Lastly, advanced IVR systems can even record and deliver real-time stats needed for tracking and studying important KPIs.

What is ACD?

ACD works similarly to IVR. However, automatic call distribution routes calls to the right agent or department based on pre-determined rules. These rules can be based on a variety of parameters such as area code or location of the call, the time the call comes in, skills required, and so on.

An ACD distributes calls based on rules input by the account manager. These rules and conditions determine how the calls will be routed. Some common routing strategies include:

  • Round robin: Distributes calls equally among agents so no one is over- or under-burdened.
  • Least-occupied agent: Sends calls to the least-occupied agent to ensure everyone is putting in the same amount of work.
  • Simultaneous ring: Routes incoming calls to simultaneously ring multiple phone numbers within a hunt group to ensure no call goes unanswered.
  • Programmed distribution: Routes calls based on specific rules such as location of caller, time of call, customer-agent history, language skills, etc.

IVR versus ACD: Difference

The terms IVR and ACD have often been used interchangeably as if they are the same systems. However, they are not. More specifically, IVR is a part of ACD and can conduct a variety of tasks within the system. So, how do they differ?

Interactive Voice Response Automatic Call Distribution
This technology allows users to receive information from the phone system. Users need to input preferences. This technology automatically routes calls to employees, agents, or departments based on predetermined rules.
Upon receiving a call, the IVR provides the caller with options and menus. Upon receiving a call, the ACD system uses the Dialed Number (DNIS) system to check the rules for processing the call.
This system can perform a variety of application functions such as activating services, customer info look-up, etc. The IVR system works within the ACD system.
Interaction with employees is not needed. If interaction with an employee is needed, then the ACD kicks in to transfer the call to the right employee.
Offered by phone service providers as well as virtual phone service providers. Offered by phone service providers as well as virtual phone service providers.
Available as a hosted service as well. Available as a hosted service as well.

Which Do You Need?

More than their differences, IVR and ACD systems complement each other. Together, both systems can provide a robust business phone solution. They can help you manage calls and high call traffic while ensuring you do not lose valuable clients. After all, a well-managed phone system can help you provide prompt and efficient customer service. A cloud or virtual call center software can help you utilize both IVR and ACD within your office phone system. Call us today to learn how you can use a cloud IVR system to offer better customer service!

5 Innovative Ways for a Call Center to Use Interactive Voice Response

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Does your call center business use IVR to communicate with customers? A well-designed system offers incredible versatility, which can help your business in a variety of ways. Check out these five innovative ways for call centers to use interactive voice response technology.

How Can IVR Be Used in a Call Center?

Most inbound call centers use IVR systems to provide callers with pre-recorded greeting messages and sets of menu options. Menu options will often be for self-service, sales, and customer support. Callers provide input to a call center IVR system by pressing a key.

After gathering caller inputs, the IVR can help your call center route inbound callers to the right agent or department.

So, what are some ways to get the most out of your IVR system?

1. Skills-Based Routing

It is important to choose the right routing strategy for your contact center.

Effective call routing can boost first call resolution rates as customers are able to speak to the right agents right away. IVR can also help call centers automatically route inbound callers to the right department in less than twenty seconds.

The most effective IVR routing strategies are often based on:

  • Agents’ skills such as language preferences or experience.
  • The origination of the inbound call.
  • The time the call is coming through.
  • Equal distribution of calls among a group of agents, and more.

These are real strategies that call centers have used over the years. We have helped businesses implement such strategies to improve efficiency.

2. Create Personalized Messages

A customized greeting and menu options provide a great branding opportunity. Studies show that callers are more comfortable when they hear a welcoming greeting message. IVR can be used to personalize your entire caller experience.

The best technique is to welcome callers with a customized greeting message and pre-recorded menu options. These should have relevant information about your business to help callers easily navigate menu options.

3. Provide Self-Service and After-Hours Support

IVR can be used to offer after-hours customer support by adding information about your company, its product and services, and upcoming promotions.

You can forward incoming calls after-hours or during the weekend to remote offices, agents, or voicemail. You can even have the IVR assist callers in completing certain tasks such as making a payment or scheduling an appointment.

4. Call Center Agent Automation

Automation will certainly boost call center productivity. Luckily, artificial intelligence offers a simple way to automate complex business tasks. This will help your business gain greater performance abilities and utilize the talents of your team more effectively.

A contact center IVR operates right along these lines. The main point of having IVR is so your business can speed up processes. Some of the automation advantages it offers include:

  • Verification and service activation
  • Payment and renewal processes
  • Providing product information
  • Troubleshooting services
  • Providing answers to frequently asked questions, and so on.

If the IVR can help customers with these tasks, then they are less likely going to need to speak with an agent. This leaves trained representatives with more time to handle more high-value customers.

5. Manage Calls During High-Traffic Periods

By adopting the right strategy that helps organize your calls, your team can effectively handle calls during high-traffic periods. By automating services, most calls can be handled by the IVR system alone, giving your agents and reps more breathing space during such periods.

Learn More About IVR

United World Telecom offers a highly customizable IVR system with tips to help your business leverage its voice communications. To learn more about interactive voice response, please contact us today!

10 Benefits of Using an IVR System

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Almost every business now has an IVR system that answers calls on its behalf and then routes callers to the appropriate department. So, why are more and more companies using this automated communication tool?

IVR System: Top 10 Benefits

An interactive voice response, or IVR system, is an automated voice response system that answers incoming calls, identifies the purpose of the calls, and assists the caller. It transfers calls to the appropriate department or provides self-serving options that customers can complete themselves. IVR phone systems cut down on time and money while improving the way a caller interacts with a company. Here are 10 ways a business can benefit from IVR service.

1. Prioritizes Calls Based on Value

IVR systems can be predetermined with rules to prioritize and route calls based on the caller and their needs. This way, you can route high-value customer calls to the most appropriate or qualified agent. If agents are unavailable, the caller will be first in the queue. Doing so ensures that your team does not lose an important caller’s business due to long wait times.

2. Reduces Costs

An effective and well-designed IVR service can run without the need of an agent. It can help callers by providing self-serving options and only when these options fail, is an agent required. Therefore, an IVR system can help businesses save on the costs of hiring large customer service teams by allowing the automated system to do more. Your team can then focus on more important issues and interacting with high-profile clients.

3. Reduces Time Spent on Mundane Tasks

Customers calling a business need answers fast. Customer service teams are constantly on the phone resolving issues. An interactive voice response system saves time for everyone by interacting with the customer, identifying their needs, and offering support either through pre-recorded messages or by transferring them to the right department. They can expedite calls, accurately transfer callers, help them complete certain actions, and schedule callbacks. These calls never go unanswered. Callers receive support in some form or the other, without time wasted.

4. Supports and Improves Lead Conversion

Recent advancements in IVR technology have made it possible to use this tool for sales and lead generation. IVR systems, depending on the provider, are capable of reaching out to prospects on predetermined lists to check if they pre-qualify. They will ask prospects a few questions, after which qualified prospects will be routed to live representatives.

5. Enhances Caller Experience

Most providers offer IVR phone systems that can be customized on your end. Customize to improve caller experience through custom greetings, easy-to-understand prompts, and so on. This interaction should reflect an ideal interaction with your company. Callers who can easily navigate the system and get their concerns resolved quickly will only appreciate your brand even more.

6. A Marketing and Feedback Tool

Marketing teams have used IVR to study customer behavior and preferences using phone surveys and conducting marketing research. You can gain insights into your audience’s likes and dislikes, their demographics, communication preferences, and more. This information can be used to serve them better.

7. Scalability

IVR systems can adapt to an organization and its customers’ changing needs and expectations. Cloud-based systems are highly customizable and have virtual communication features such as intelligent routing, multilingual capabilities, and more. As your business grows, you can add more to your IVR phone system to support your needs.

8. Provide 24/7 Customer Support

IVR technology makes it possible to provide 24/7 customer support as it answers calls even during off or after hours. During these times, calls can be routed to a different office (in a different time zone), remote agents, or even your mobile phone. It can also provide answers to simple questions, provide company and product information, verify accounts, process payments, schedule callbacks, route to voicemail, and more. This way, even if caller concerns are not resolved, they know that they will receive a callback.

9. Personalized Self-Service

Automation is the future of customer service. An advanced IVR system can help callers verify new accounts, check account information, make payments, request renewals, and much more. You can even program the system to provide trouble-shooting support. This is helpful during high traffic periods when agents are busy, during off-hours, or for customers who prefer to solve the problem themselves.

10. Improve the Business’ Image

A business that provides 24/7 service and is able to resolve issues on the first call itself is a company that can be trusted and relied upon. And an IVR service can build that image for your company by making it more accessible and helping customers resolve their concerns quickly and efficiently.

Ready to Get IVR for Your Business?

United World Telecom offers an IVR system that can be easily customized and designed to meet your needs and requirements. Our IVR service comes along with each of our virtual number plans. To get the service, simply sign up for a new number or port your existing number on our homepage. Have more questions? Speak to an expert today!

Interactive Voice Response: Definition and Benefits

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In this guide, you will learn everything there is to know about an Interactive Voice Response (IVR system).

What is Interactive Voice Response?

Interactive Voice Response (IVR) is an automated telephony system with call routing capabilities. An IVR system can answer incoming calls, provide callers with a set of menu options, and then based on caller inputs, route the calls to an appropriate recipient.

As soon as calls connect to an interactive voice response system, callers are greeted by a prerecorded voice menu. The callers can interact with the menu in order to be connected with the right department or representative. Interactive voice response is so common, it is highly likely you have interacted with one before.

Any business can benefit from a cloud IVR system. It helps collect caller information and transfers calls to the right departments, enabling outstanding customer service, while reducing operating costs.

How Does IVR work?

An IVR system gathers information from callers and then routes those calls to another phone number or extension. Basic IVR systems work by collecting user input through touch-tone selections. More advanced systems can gather user inputs in the form of spoken responses using voice recognition.

IVR is an automated approach to customer service that reduces customer hold times and boosts worker efficiency. Even the most basic interactive voice response system can save time and resources. Organizations now have a more efficient way to manage incoming calls.

Cloud IVR Systems

A hosted or cloud IVR system works over the cloud. You can get an IVR system from your phone service provider who hosts the service. This means that you do not have to worry about developing the service or maintaining it. Your provider takes care of this. Your business simply needs to create a phone tree to route calls as you need. You can go in and change these routing settings whenever required.

IVR Systems for the End-User

Interactive voice response enables callers to easily navigate a contact center and find the right solution for themselves. The end-user can interact with an IVR system using the touch-tone keypad on a phone, or in more advanced cases, through spoken words.

For example, the end-user will dial a phone number with IVR and be connected to a voice menu. The end-user is then asked to choose from a set of menu options, which he or she can respond to by pressing or saying “1, 2, 3, etc.” in order to get connected to the right department.

Basic IVR Versus Advanced IVR

IVR has two primary components that enable callers to interact with the system: DTMF and voice technology. DMTF, which stands for Dual-Tone Multi-Frequency, is a means of signaling to an IVR system using a telephone keypad. A basic IVR system enables callers to interact with a voice menu using DMTF.

More advanced systems use voice technology like natural language processing, to understand callers’ requests. Natural language processing is a type of conversational AI that enables computers to answer complex open-ended queries.

A more advanced cloud IVR software with voice technology will certainly impress callers, but even the most basic IVR can drastically improve customer experience by reducing callers’ common frustrations with a complex multi-level menu.

ivr software

The Technology Behind IVR Software

At a technical level, interactive voice response software uses the following technologies: telephony equipment, a database, and supporting infrastructure. The software needs to be enabled and then configured in order to work. These are the most relevant technologies:

  • TCP/IP: A set of communications protocols that enables computers to interact over a network.
  • Databases: IVR software needs access to a database in order to serve relevant information in real-time.
  • Web/Application Server: The server performs various key functions and is the core of an IVR software.

While the underlying technology is less relevant to end-users, it is still important to have an idea of how interactive voice response technology works.


Oftentimes, the terms IVR and ACD are used interchangeably even though they are essentially different systems. Automatic Call Distribution (ACD)  routes calls to the right department or agent based on rules set by the business. IVR is a part of an ACD system and helps route calls to the right location as determined by the account manager. You can try different routing strategies to ensure calls are answered by the right agent and callers are assisted quickly. More on call routing strategies below.

Common Hosted IVR Applications

With incredible flexibility, interactive voice response systems have many potential applications for businesses of all sizes. These are the most common use cases that we have seen in over twenty years of experience:

  • Set up a custom voice menu and touch-tone prompts
  • Greet callers with a pre-recorded message
  • Collect information about callers
  • Route callers to the right department or agent
  • Manage high call volumes
  • Prioritize calls based on certain criteria
  • Automate customer support

Cloud IVR Benefits

Over the past two decades, these are the seven most common benefits that IVR users have reported.

1. More Efficient Customer Service

Customers are impatient when they want service. They want timely answers to their questions and they want all their problems to be solved quickly!

IVR can help callers feel like they are being better attended to by increasing first contact resolution. FCR is the percentage of contacts that are resolved on the first interaction and it is a great measure of customer service performance. On average, businesses that use interactive voice response have much higher first contact resolution compared to businesses that do not.

Efficient call routing will lead to better customer service. By automatically routing calls to the right departments, all your customers’ requests can be quickly dealt with appropriately.

2. Workforce Automation

For many companies, IVR has already automated key roles in the workforce. An interactive voice response system can greet callers, gather their relevant information, and then route their calls to the right departments, thereby eliminating the need for live phone attendants.

Let’s face it – employees at a company are only human and we all make mistakes. Although never intentional, human error has been a major contributing cause of business accidents over the years. Our research shows that a fully automated business communication system can eliminate up to 100% of human error.

IVR also works for you 24/7. Regardless of whether staff is available, incoming calls will always get routed through properly to the right extension. As your business becomes more accessible to potential customers, revenue will also increase.

3. Higher Profits

Businesses of all sizes use IVR to increase profitability. Remember that operating profits are calculated by subtracting operating expenses from gross profits.
A cloud IVR system is able to automate certain key processes at a negligible cost so fewer employees are needed to manage the phone lines.

4. Manage High Call Volumes

Imagine if you could scale your business by leveraging your entire workforce at full productivity. An IVR system can help manage your high call volumes, while also being able to scale rapidly to meet your expected growth. It has the ability to serve multiple customers simultaneously so the rest of your employees can work on more productive activities.

5. Increased Agent Efficiency

By routing calls to the right extensions, agents spend less time transferring calls around and communicating back-and-forth with other agents. Increased agent efficiency has major benefits for all types of businesses.

First off, thanks to IVR, agents no longer need to waste valuable time on the phone collecting redundant information. A cloud IVR system can maximize agents’ time that is spent on the phone with customers. When your agents aren’t on the phone with customers, their time can be better spent on other revenue-generating activities.

Second, call center agents are able to specialize in various key functions thanks to IVR, and thus become more efficient in each role. It’s possible to route calls to different agents based on certain criteria. You can also maximize customer lifetime value by prioritizing callers from high-income regions.

Finally, an interactive voice response system provides call analytics that enables managers to monitor user performance and agent productivity. Unlock the full potential of your workforce with an IVR.

6. Wider Personalization

Studies show that more personalized customer service can boost revenue by 40%. We have determined that some potential customers can get turned off when they call a business only to hear a boring old ringback tone.

Luckily, IVR systems make it easy to personalize and enhance customer experience on the phone. Your callers will appreciate a more personalized experience when their calls get answered by a customized voice greeting followed by a list of highly-tailored menu options.

7. Professional Company Image

In today’s day and age, it’s especially important to make a good first impression. In fact, Forbes Magazine declared that potential customers will form an opinion of your business based on a variety of factors including phone calls.

Interactive voice response can create instant credibility for your business by promoting a professional image that is well-put-together.

How Does a Contact Center Use IVR?

Most contact centers already benefit from interactive voice response technology because it can streamline a great number of key business functions. Here are the most common ways contact centers use IVR.

Efficient Call Routing

An IVR system for call centers will gather key information from callers at the start of the interaction. After registering a response, the cloud IVR system will then direct callers to the appropriate departments. This helps satisfy customers by reducing the time spent on hold and it also maximizes the efficiency of agents in your contact center. Read our post about top IVR routing strategies to learn more.

Self-Service and AI

Self-service is the foundation of a good contact center experience. In fact, 81% of customers prefer to try self-service before reaching out to a live representative. Modern IVRs may use artificial intelligence to enable self-service.

Over time, artificial intelligence can further develop to fulfill increasingly complex needs and eliminate a large number of mundane tasks. You should also keep in mind that callers can interact with your voice response menu to get self-service at any time of day.

Advanced Speech Recognition

Modern voice response systems use advanced speech recognition to better serve callers. Advanced technologies like natural language processing enable cloud IVR systems to clearly understand callers’ requests and determine the reason for their calls. Harvard studies have shown the potential of NLP in contact centers.

CRM Integrations

Callers prefer not to repeat themselves. Luckily, CRM integrations exist that enable your IVR system to fetch relevant information about callers in real-time. This helps agents in your contact center deliver more personalized information to satisfy very specific needs. Call center integrations can also boost caller satisfaction by producing seasoned call center agents.

IVR Best Practices

When used incorrectly, your interactive voice response system could have a negative impact on your business. That’s why we recommend that our customers are mindful of their end-users. We recommend following these best practices to deliver a delightful IVR experience.

1. Research Your Audience

You should research your audience and your end-users before setting up IVR. Key research should involve figuring out which customers are most likely to interact with your voice response system. By doing this, you can create a more personalized experience with highly tailored menu options.

2. Survey Caller to Improve Your IVR Experience

Surveys can help determine how satisfied your customers are with the overall phone experience that you provide. It is important to regularly survey customers and elicit feedback and then implement their valuable suggestions. Surveys help businesses build better hosted IVR systems that callers actually enjoy using.

3. Use Natural Speech Recognition for Complex Applications

Natural language speech is more flexible than touch-tone interaction. That shouldn’t come as a surprise to anyone. It is not always necessary for quicker transactions, but speech recognition can enhance more complex business applications.

4. Keep Your Menu Simple

It’s best to start with a simple IVR menu that is capable of handling your most common requests. Don’t try to automate very complex transactions until you get more comfortable using IVR.

We recommend a basic menu that greets callers and asks them to input a single-digit number that corresponds to a particular department. Industry studies show that callers prefer to interact with a phone menu that has four choices or fewer and a maximum of two levels.

5. Regular IVR Testing

Testing should be performed regularly to ensure that your menu is able to handle expected traffic and properly serve customer requests. There are various network testing methods that have been developed over the years which can help ensure that IVR technology does not become a weak link in your business’ customer experience.

Mistakes to Avoid

A good hosted IVR system that follows best practices can have unlimited business potential. A bad setup, on the other hand, will undoubtedly frustrate your customers. It’s important to set up everything properly. We recommend that you avoid these three common mistakes if you want to maximize the caller experience.

1. Hold Times That Exceed 45 Seconds

Customers are impatient and they don’t like to wait on hold. According to industry research, 60% of callers will hang up after just one minute on hold! We recommend that you do not keep your customers on hold for more than 45 seconds at a time.

2. Unreachable Live Agents

Not everyone will want to use your hosted IVR system. In fact, you could have the most user-friendly setup in the world, but there will always be a segment of your customers that prefers to speak with a live agent. That’s only logical, as there are certain requests from customers that don’t fall under any menu options and a computer could never help with.

That’s why we recommend that you avoid the mistake of having unreachable live agents. Your IVR menu should always contain an option to be transferred to a real-live agent. You shouldn’t bury this option too deeply in your menu, either, because this will always result in frustrated callers.

3. Complicated Menus

Potential buyers will be turned away by too many menu options or a voice response system that is too complex. We already know customers are impatient, so why list ten menu options that your callers have to sift through? We recommend that you keep your IVR menu simple with two levels at most and a maximum of four choices on each level. The possibilities, however, are nearly unlimited.

Reach out to us if you want to learn more about IVR and how it can help your business.

7 Best IVR Routing Strategies for Your Call Center

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You’ve set up IVR your call center and want to know the best way use it? Here are 7 routing strategies that can determine how callers interact with your business so that you can maximize performance and results.

IVR: Seven Best Routing Strategies

The best IVR routing strategies can assist companies in handling their call volumes and providing strong and efficient customer service. While it may not entirely replace agents, it can take some of the burden off of agents by completing mundane tasks. This way, it frees agents up to focus on more complicated tasks.

If you don’t know what an IVR is, you should check out this blog post that we wrote about interactive voice response, its definition, and benefits.

There are a few different IVR routing strategies that have been proven successful over the years. Here are some that you may consider:

1. Direct Routing

Callers select their preference or need and are routed to the appropriate department or employee.

IVR menu example: “Press 1 for company information. Press 2 for the reception. Press 3 for sales. Press 3 for customer service.”

If the caller wants to speak to someone in customer service, they will press 4 and be directed accordingly.

IVR direct routing

2. Self-Service Routing

Callers select their preference or need and receive information via automation and prerecorded messages. This type of routing typically does not need an agent to participate. The caller, therefore, does not wait for an agent, reducing wait times and leading to higher first call resolution rates.

IVR menu example: “Press 1 for business hours. Press 2 for location details. Press 3 for business directory. Press 4 for account information.”

If the caller wants to know the location of the business, they will press 2 and hear a prerecorded message detailing the location.

IVR self service

3. Geographic or Location-Based Routing

Callers are required to input or dial their zip code or other location ID to be routed to the closest location.

IVR menu example: “Please enter your zip code or location ID associated with your account with our business.”

Based on caller input, calls with be routed to office locations in different countries, states, or cities, as needed by your business.

IVR geographic routing

4. Time-Based Routing

Calls route to different numbers, lines, or locations based on times or time periods set by your business.

IVR menu example: Calls made to your business after-hours or over the weekend will be forwarded to your office in a different location or time zone. This way, callers connect to the next available agent and no call goes unanswered.

IVR time based routing

5. Skill-Based Routing

Caller inputs a need or preference into the IVR system and is routed to the right agent. For example, language preferences.

IVR menu example: “Press 1 for English, Press 2 for Spanish. Press 3 for French.”

Callers who wish to converse in Spanish can press 3 for their convenience and be directed to interact with an agent who speaks the language fluently.

IVR skill based routing

6. Data-Directed Routing

Callers provide account data that identifies them and prioritizes and directs them to the right agent.

IVR menu example: “Welcome to [insert a company name.] Please enter your account number/ID to get started.”

Based on caller input, they will be provided with the next set of options related to their account. For example, if their fees are overdue, they will have a payment option or be sent to the accounting department. If they recently registered a complaint, they will be directed to the agent they worked with the last time they called, and so on.

IVR data directed routing

7. Least-Occupied Routing

Callers are routed to the rep who has taken or answered the least number of calls on a given day. In other words, callers connect to the agent waiting the longest to answer a call.

IVRleast used routing

Related: 10 Benefits of Using an IVR System

Learn More About IVR Routing

Want to learn more about call routing strategies for your interactive voice response? Call us today at 1 (877) 898 8646 to see how we can help you build your ideal automation system.