A CEO Laid Off 90% of Support Staff, Replacing Them With an AI Chatbot

• Suumit Shah, the CEO of the e-commerce platform Dukaan, laid off 90% of his support staff, replacing them with an AI chatbot. 
• He shared on Twitter that the new chatbot reduced customer support costs by 85%.
• His posts sparked an online backlash, with one commentator summing it up as “how not to announce layoffs.”

The CEO of an e-commerce platform is getting absolutely roasted online for posting a Twitter thread saying the company laid off 90% of its customer support staff after an AI chatbot outperformed them.

Suumit Shah, the 31-year-old CEO of Duukan, a Bengaluru-based company that helps businesses set up their online storefronts, first shared the news on a Twitter thread on 11 July.

“We had to layoff 90% of our support team because of this AI chatbot. Tough? Yes. Necessary? Absolutely,” Shah wrote in a thread that’s been viewed over 1.5 million times since being posted. 

—Suumit Shah (@suumitshah) July 10, 2023

In the thread, Shah wrote that an AI chatbot took less than two minutes to respond to customer queries, while his human support staff took over two hours.

Replacing most of his customer support team with a chatbot reduced customer support costs by around 85%, he wrote.

Shah told Insider the layoffs occurred in September 2022 and resulted in Duukan — which currently employs 60 people — letting go of 23 of the 26 members of its customer support team. In a conversation on Wednesday, Shah said his “monthly budget” for customer support is now $100. Insider could not independently verify these figures.

But Twitter and Reddit users aren’t buying the explanation. As of press time, more than 600 Twitter users had quoted his tweet, with the vast majority being critical of Shah and Duukan.

Twitter user @adityarao310, whose tweet had accumulated more likes than Shah’s own, posted: “Make no mistake. The support team was laid off here because business is failing and funding is dry. Not because of AI.”

Another user, @samikshagoel20, shared Shah’s tweet, writing: “How not to announce layoffs.”

—Samiksha Goel (@samikshagoel20) July 11, 2023

Meanwhile, Reddit user u/kakapoopoopeepeeshir commented in a thread on Tuesday: “I’m terrified of the future where we will never speak to a human again in customer support which means we will never get a problem solved, you’ll just be passed around between bots.”

Responding to the online backlash, Shah told Insider that he regretted kicking off a conversation about layoffs on Twitter but was adamant that his point still stands. “AI is taking our jobs,” he said.

“Over time, everybody will start doing this. It’s not just us. Maybe I’m just too straightforward to have put it on Twitter,” Shah added.

Dukaan is far from the first company to announce lay-offs as a result of AI, a trend which is likely to continue, according to a May report by human resources firm Challenger, Gray, and Christmas.

In May, Insider reported on another set of layoffs that sparked similar outrage when the US National Eating Disorder Association laid off its entire helpline staff and replaced them with a chatbot. Soon after, the chatbot was disabled for giving out harmful information on eating disorders.