For a long time, particularly in the restaurant business, technology was often shoved in the back, largely ignored until it became time to change the point-of-sale system.
That has changed dramatically in recent years as consumer habits shifted and companies more desperate to find customers and employees turned to technology with increasing gusto.
“Gone are the days when the IT guys were in the back room making sure the servers are running,” Clay Dover, CEO of the fast-casual chain Velvet Taco, said during the FSTEC Conference in Dallas on Monday. “Tech is a place where you want a CIO to be at your board meeting. If you make a presentation, you want a whole section on what you’re doing with data.”
The importance of technology in the industry was on display at the conference when operators and top executives gathered in Dallas to meet on the state of industry technology. A record number of people attended the event, which continues through Wednesday.
Demand for technology among restaurants has been obvious for some time now. When the pandemic hit, many operators found themselves with little choice but to push hard to get mobile ordering in place, along with third-party delivery deals, simply to get enough customers to generate cash and survive.
At the same time, as sales returned but workers didn’t necessarily come back, operators looked toward technology to operate restaurants with fewer employees.
White Castle, for instance, has been testing the use of “Flippy,” a robot from Miso Robotics that operates the fry station. “We’d normally have one to two people on fries depending on volume,” Lisa Ingram, CEO of the burger chain, said at the conference. With Flippy, she said, four or five workers a day can be deployed to other areas rather than fries.
The drive-thru burger chain Checkers and Rally’s, meanwhile, is adding artificial intelligence to take orders in its drive-thrus. Minh Le, chief information officer for the chain, noted that during the labor shortage some workers wouldn’t show up during a breakfast shift. The A.I. enabled a restaurant to operate with only a couple of workers.
“It greatly reduces labor pressure,” Le said. “It pays for itself.”
To be sure, many technologies that were hot not too long ago are not so hot any longer. One such technology that has attracted some scrutiny is the self-order kiosk, for instance. “Kiosks were a snapshot in time before everybody had a kiosk in their pocket,” said Rick Cook, SVP of technology for Portillo’s.
It’s also worth noting that a lot of technologies that are supposed to make the industry more efficient are not as widely in use as the attention being paid to them. And there are some doubts about whether automation is worth it, at least on a wide scale. McDonald’s CEO Chris Kempczinski notably said there is “no silver bullet” when it comes to technology, arguing that the cost doesn’t pencil out.
And technology may not generate sales, either, so much as it simply keeps restaurants from losing sales to customers that have grown accustomed to ordering online. Dover said 31% of his chain’s sales are coming through digital channels, something increasingly common across the industry.
To be sure, the data and growing use of loyalty do give operators a chance to generate more sales from loyal consumers.
But all these efforts are as much a defensive play as anything else. Operators cannot afford to ignore these technologies, lest they lose customers. And they can’t afford to find efficiencies, even if those efficiencies are on the margin, lest they lose their employees.