Maria had been working customer support for three years when the email arrived. “Effective immediately, your position has been eliminated,” it read. She wasn’t alone—89 other colleagues received the same message that Tuesday morning in July 2023. Within hours, chatbots had quietly taken over their desks.
What happened next at Dukaan, an Indian e-commerce startup, wasn’t just another tech layoff story. It became one of the most dramatic real-world experiments in AI replacing employees that the business world has ever witnessed.
The founder’s decision sent shockwaves through the tech industry, but a year later, the results tell a story that nobody saw coming.
When a CEO Bet Everything on Artificial Intelligence
Suumit Shah didn’t wake up one day and decide to fire 90% of his workforce on a whim. The CEO of Dukaan, a platform helping small Indian businesses sell online, was facing the kind of pressure that keeps startup founders awake at night.
Customer complaints were piling up faster than his human support team could handle. Response times stretched to nearly two minutes—an eternity in today’s instant-everything world. Investors wanted growth, customers demanded speed, and the math simply wasn’t working.
“We were spending more on support staff salaries than we were making from some of our smaller merchant accounts,” Shah later revealed. “Something had to change, and it had to change fast.”
So in the summer of 2023, Shah made a decision that would make him either a visionary or a cautionary tale. He replaced nearly his entire customer support and operations team with AI-powered chatbots.
The transformation happened almost overnight. Employees who had been answering customer queries, processing refunds, and solving technical issues were suddenly replaced by algorithms that never slept, never took breaks, and never asked for raises.
The Numbers That Changed Everything
One year later, Shah isn’t hiding from the results. He’s actually celebrating them. The data tells a story that even AI skeptics find hard to dismiss.
Here’s what actually happened when AI took over:
| Metric | Before AI | After AI | Change |
|---|---|---|---|
| First Response Time | 2 minutes | Instant | 99% improvement |
| Resolution Time | 2.5 hours | 3.7 minutes | 85% faster |
| Customer Satisfaction | 3.2/5 | 4.3/5 | 34% increase |
| Support Cost | $78,000/month | $2,100/month | 97% reduction |
The speed improvement was the most dramatic change. Customers who once waited minutes for a human agent now get responses faster than they can finish typing their questions.
“I thought I was chatting with a super-human who could read minds,” wrote one customer in a review. “The bot knew exactly what I needed before I finished explaining my problem.”
But it wasn’t just about speed. The AI systems could handle multiple languages, work 24/7 without breaks, and access the company’s entire knowledge base instantly. They never had bad days, never misunderstood simple requests, and never transferred customers to the wrong department.
- Zero wait times during peak hours
- Consistent service quality regardless of time or day
- Instant access to order history and account details
- Multilingual support without additional training costs
- Perfect memory of previous conversations
“The bots don’t just replace human capabilities,” Shah explained. “In many ways, they exceed them. They never forget details, never lose patience, and they’re learning from every single interaction.”
The Human Cost of Silicon Valley’s Latest Experiment
But this success story comes with a shadow that’s impossible to ignore. Behind every percentage improvement and cost reduction were real people who suddenly found themselves competing with machines—and losing.
The 90 employees who lost their jobs weren’t just statistics in a spreadsheet. They were customer service representatives, technical support specialists, and operations coordinators who had families to feed and bills to pay.
“It felt like being replaced by a calculator,” said one former Dukaan employee who spoke anonymously. “Everything I’d learned about helping customers, building relationships, understanding their problems—none of that mattered anymore.”
The ripple effects extend far beyond Dukaan’s former employees. Other Indian startups are watching closely, and some are already following suit. The fear among workers is palpable—if a mid-sized e-commerce platform can replace 90% of its workforce with AI, what company can’t?
“This isn’t just about one company anymore,” warns tech industry analyst Priya Sharma. “It’s become a template that other businesses are seriously considering.”
The broader implications for India’s massive service sector are staggering. The country employs millions in customer support, data entry, and similar roles that could potentially be automated. If AI replacing employees becomes the norm rather than the exception, entire communities could be affected.
Yet Shah maintains he had no choice. “Business is about survival,” he argues. “We couldn’t compete with companies offering instant support while our customers waited minutes for help.”
The success of Dukaan’s AI experiment has also caught the attention of international investors. The company has reportedly seen increased interest from venture capital firms impressed by its dramatically improved efficiency metrics.
However, critics point out that the long-term effects remain unknown. Will customers eventually crave human interaction again? Can AI systems handle complex emotional situations that require empathy and nuanced understanding?
“We’re essentially conducting a massive social experiment,” notes workplace researcher Dr. Rajesh Kumar. “The early results might look good on paper, but we have no idea what the human and societal costs will be five or ten years from now.”
FAQs
How did customers react to the sudden switch from human support to AI?
Initially, many customers didn’t even notice the change because response times improved so dramatically. Customer satisfaction scores actually increased by 34%.
What happened to the 90 employees who were replaced?
While the company hasn’t provided detailed information, most were let go with standard severance packages. Some have found new positions, but others are still seeking employment.
Can AI chatbots really handle complex customer service issues?
According to Dukaan’s data, the AI systems resolve 85% of customer issues without human intervention. More complex cases are escalated to the remaining human staff.
Is this trend spreading to other companies in India?
Yes, several other Indian startups have reportedly begun implementing similar AI-first support strategies, though none as dramatically as Dukaan.
What are the legal implications of replacing workers with AI?
In India, companies generally have the right to restructure their workforce as long as they follow labor laws regarding severance and notice periods.
How much money did Dukaan save by switching to AI?
The company reduced its monthly support costs from approximately $78,000 to just $2,100, a savings of over 97%.
About the Author
