Interactive Voice Response (IVR)

Interactive Voice Response increases efficiency and saves time and money for business.

In this era of high-speed connectivity, businesses receive a flood of incoming calls from customers seeking immediate responses to their queries. However, not all business have a group of live agents to answer all question. That’s where Interactive Voice Response, or IVR, comes into play.

What is Interactive Voice Reponse (IVR)?

Interactive Voice Response (IVR) is an automated telephone system feature that enables callers to receive or provide information, or make requests using voice or keypad dial-tones (DTMF), without speaking to a live agent. When you contact a company for the first time, you will typically encounter a voice menu, which is part of the IVR system.

The main function of an IVR phone system is to collect information or direct calls to the appropriate destination. It’s commonly used in customer service and call center automatic call distribution systems to improve customer experience.

It can provide pre-recorded information, route calls to the appropriate department or agent, process payments,conduct surveys, and more.

By using IVR, we can efficiently handle incoming calls and provide navigation to callers.

Uses of Interactive Voice Response

IVR technology finds extensive applications in various industries such as hospitals, banks, and more to provide 24/7 accessibility. It comes in handy to reduce call wait time especially when a business has high call volumes. Some business processes that IVR can help handle include:

Customer inquiries and support

Call routing and transferring

Account balance inquiries

Automated bill payment

Interactive menu navigation

Order tracking and status updates

Appointment scheduling and reminders

Survey and feedback collection

Agents anwering calls after interactive voice response route the caller to the agent

How does Interactive Voice Response work?

The first step in an IVR is someone making a call. A customer dials your phone number and gets connected to the IVR system. The system greets them with a welcome message and presents a series of options, known as the IVR menu. This menu can be one or several layers deep.

Then, the caller chooses an option in the IVR menu by pressing a button on a touch-tone keypad. The system uses dual-tone multi-frequency signaling (DTMF) to recognize caller requests and route the caller to right individual or department. Some advanced IVR phone systems also support speech recognition (Natural Language Processing technology), which allows the interactive voice response system to recognize customer requests based on the keywords they say.

When a choice is made, the IVR routes the call to a phone extension, department, queue, or message pre-configured in your IVR application. The routing setup can be multi-level, time-based, language-based, or a combination of these factors.

Phone tree example of Interactive Voice Response IVR

Multi-level IVR

Callers are guided through multiple layers of menu choices. Each menu option in the IVR call flow leads to a submenu of more specific options, allowing them to reach their desired destination more efficiently.

Multi-lingual IVR

Help companies to provide services in multiple languages. After the caller selects a language, the system will play prompt messages in the selected language for enhanced communications.

Time-based IVR

Used for time-based routing. Route callers to different individuals, departments, queues, etc. based on specific time frames, with the same IVR key press event.

What are the benefits of Interactive Voice Response?

With a proper IVR routing configuration, companies can save time and money by speeding up calls and requiring fewer agents to handle customer inquiries. Some other benefits of using IVR software include the followings:

Improved Customer Satisfaction


24/7 Availability




Cost Savings


Data collection and analytics


What are the challenges of using IVR?

One significant challenge is navigation difficulty. Complex or unclear menu options can lead to caller frustration, as callers may struggle to find the correct path to resolve their issues. This can result in longer call times or even cause customers to hang up before reaching a resolution.

Another challenge is to provide personalized service. IVR systems, being automated, cannot offer the tailored support that a live agent can, which may leave customers feeling undervalued and dissatisfied.

Further Readings on Interactive Voice Response (IVR)

How to set up an IVR system?


Once these elements are ready, you will need a business phone system to implement the IVR. It can be an on-premise PBX or cloud-based phone system. You may also need to integrate databases or business systems to enable information retrieval or self-service transactions.

What is a phone tree and its relationship with Interactive Voice Response?


What is the difference between IVR and ACD?


ACD routes incoming calls to the appropriate agent based on various factors such as skills, expertise, and availability, while IVR focuses on customer interaction and self-service capabilities. It can be said that IVR is an essential component of ACD system. They work together to create a comprehensive call center solution that improves customer satisfaction and operational efficiency.

What is the difference between VRU and IVR?


A VRU refers to the hardware component of an automated phone system that plays pre-recorded voice prompts and messages to callers. It is responsible for receiving input from callers through touch-tone keypads or speech recognition and delivering appropriate responses. Essentially, the VRU handles the technical aspects of playing prompts and capturing caller input.

On the other hand, IVR refers to the broader concept of using voice prompts and menus to interact with callers. It encompasses both the hardware (VRU) and software components involved in providing interactive capabilities to callers.

In summary, the VRU is the hardware component that handles voice prompts and input, while IVR refers to the overall system that includes both the hardware and software elements responsible for interactive communication with callers.

What is an example of interactive voice recognition?


Does Yeastar support Interactive Voice Response (IVR)?


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