What Klarna's AI Reversal Teaches Us About the Future of Customer Experience

An article about this content was originally published in Fast Company.

In early 2024, Klarna's CEO declared that AI could do all human jobs. The company had slashed its workforce from 5,500 to 3,400. Its AI chatbot was handling the work of 700 customer service agents. They were the future, and they wanted everyone to know it.

Fourteen months later, Klarna was forcing its software engineers and marketers to staff the phones.

Customer satisfaction had cratered. Service quality had collapsed. The company that wanted to be OpenAI's "favorite guinea pig" had become a cautionary tale for every enterprise betting big on AI.

The Real Story Behind the Headlines

Klarna isn't an outlier. Research shows that 55% of companies that executed AI-driven layoffs now regret it. By 2027, Gartner predicts over 40% of agentic AI projects will be canceled outright. The root cause isn't the technology. It's the philosophy behind how it's deployed.

The companies pulling ahead aren't asking "can AI do this job?" They're asking "what could our people accomplish if AI handled the operational load?"

What the Winners Do Differently

The contrast is striking. While Klarna was forcing engineers onto customer service calls, companies like Tripadvisor, Thumbtack, and ClickUp were building something fundamentally different: hybrid teams where AI and humans amplify each other's strengths.

At Tripadvisor, AI agents now handle 90% of incoming customer queries autonomously. But the goal was never to eliminate human jobs. It was to free the support team for strategic work that requires judgment, creativity, and relationship-building. The work that actually moves the needle.

This isn't a minor distinction. According to McKinsey, companies that fundamentally redesign their workflows around AI are three times more likely to capture real value. They generate twice the AI usage per employee. The gap compounds daily.

The Lesson Klarna Learned the Hard Way

Customer experience isn't an optimization problem. It's a relationship.

When a customer calls about a billing error threatening their credit score, they don't want efficiency. They want someone who understands the stakes. When a small business owner's payment doesn't process the night before payroll, they need empathy, not a knowledge base article.

Siemiatkowski now admits that "cost unfortunately seems to have been a too predominant evaluation factor" and that the result was "lower quality." The CEO who once dismissed human workers is now building what he describes as an "Uber-style" hybrid model. A far cry from "AI can do all of our jobs."

The window to build hybrid teams is open. It won't stay open for long.

Read the full article in Fast Company: Klarna Tried to Replace Its Workforce With AI. Here's What Every Company Should Learn From Its Failure.

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