Strategic CIO // IT Strategy
Commentary
6/11/2014
09:35 AM
David Wagner
David Wagner
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Restaurants' Switch To Tablets Is Trouble

Tablets and self-service are the next big thing in restaurants. But is it a good idea?

Casual dining restaurants, including Chili's and Applebee's, will be rolling out new self-service kiosks using tablets in the next few months. The tablets will allow customers to order food, call their servers, and pay their checks without needing to interact with a human.

Preliminary tests show that such kiosks will improve revenue and table turnover while increasing customer satisfaction. But past experience with such kiosks in other industries is mixed, and restaurants should beware. Putting aside that it seems as if all this does is turn table service into fast food, CIOs looking to jump into this technology need to follow some rules to avoid major mistakes.

Before we talk about it, here is a home video of the menus in action:

As you can see, the tablets are interactive menus making use of a lot of images (though no video yet) to entice buyers into appetizers, drinks, and other "upsell" items. In addition, the tablets feature entertainment and a way to pay your bill. And we can only assume advertising will soon be on its way.

Clearly, this will eliminate some customer service problems common in restaurants. Who hasn't been ready to leave, then sat for 10 minutes waiting for the check? Who hasn't needed ketchup or a refill and suddenly the server is AWOL? Splitting checks and even figuring the tip is now easier as well.

And from the point of view of the restaurant there are obvious benefits including quicker turnover, more efficient use of staff (read: layoffs), better inventory management, better kitchen management, easier POS integration into other systems, and increased revenue opportunities via payments for game and ad placement and upselling.

Sounds like a win-win, and we've seen other success stories with kiosks like these, including ATMs and self check-in at airports. Airlines particularly have seen great savings from self check-in, reducing check-in costs to 5% of what they were before self-service.

Except there's a problem. We've also seen self-service that looked like a similar bargain turn out poorly for other industries, especially grocery stores. Self-service check-out in grocery stores is an especially good example, because they more closely resemble the transactions of a restaurant than an airline. An airline check-in is a straightforward, repeatable set of operations: identify guest, identify itinerary, offer upgrades, accept payment for extras, and direct the guest to security or to check bags.

In a grocery setting, the number and type of items is more complex. There are physical objects to be manipulated, coupons to be scanned, and sometimes physical money in the transaction. Similarly, with restaurants, the varying

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David has been writing on business and technology for over 10 years and was most recently Managing Editor at Enterpriseefficiency.com. Before that he was an Assistant Editor at MIT Sloan Management Review, where he covered a wide range of business topics including IT, ... View Full Bio
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David Wagner
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David Wagner,
User Rank: Strategist
6/11/2014 | 3:27:07 PM
Re: Love paying this way, hate ordering
--Chili's here had them at the table, and the kids managed to get me charged 0.99 for playing games on it, but a human took the order and I paid them too. I didn't notice if there was an option to pay on the tablet.


@jgherbert- They have added card readers to the side of the tablet. I think you need the server to pay in cash. But they did a bunch of tests so you may have seen a test without a card reader.
Michelle
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Michelle,
User Rank: Strategist
6/11/2014 | 3:21:23 PM
Re: Love paying this way, hate ordering
@David I really like your suggestion to follow the Starbucks model --- NO HARDWARE. I would like to see more mobile check-in options. I have used a check-in app for a barber shop with great success. Knowing your estimated wait time is handy!

We don't have reservation-based seating in my area. There are few eateries that offer call-ahead seating. I would like to see more embrace mobile for these tasks. I also want to see more mobile-friendly online ordering options.
jastroff
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jastroff,
User Rank: Ninja
6/11/2014 | 2:21:06 PM
Re: Love paying this way, hate ordering
>> grow fruit and vegetables that have the bar codes on them

 

GREAT IDEA. Works for me! thanks
jgherbert
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jgherbert,
User Rank: Ninja
6/11/2014 | 2:21:04 PM
Re: Love paying this way, hate ordering
"I haven't seen tablets for restaurant ordering & checkout locally but I am starting to see them as a check-in device in other places (health clinics, car repair, site-to-store merchandise pick up)."

Agreed; Minute Clinic (usually embedded within CVS stores) for example, use a self-checkin system (albeit not on a tablet), and although as you suggest, the interface sucks big time, it does allow them to run a queuing system without employing somebody simply to take names. When there's only one person working, this is incredibly useful and avoids so many arguments.

Implementation though... yeah. Needs work ;-)
jgherbert
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jgherbert,
User Rank: Ninja
6/11/2014 | 2:17:39 PM
Re: Love paying this way, hate ordering
You must have been next to me at the <fill in the blank national grocery chain> when my fruit and veg purchases didn't register in the auto checkout aisle, and I was presented with a video display of fruit and veg pics.

You'd think with all that genetic manipulation that goes on with food these days that scientists would have figured out a way to grow fruit and vegetables that have the bar codes on them. How hard can it be to adapt the pigment on certain areas of an apple skin, say, to represent a bar code?

Bar-nana

Once we master that, we can work on fruit and veg QR codes - if you're not sure how to prepare or eat the item, just scan it and you can get taken to a web site with recipes and advice!
jgherbert
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jgherbert,
User Rank: Ninja
6/11/2014 | 2:02:40 PM
Re: Love paying this way, hate ordering
Chili's must have been testing these for awhile because I used one of these at the one in Green Bay where I live. We had a server, I'm pretty sure we placed our order with server but I did pay for meal using the device, was curious how well it worked.

--Chili's here had them at the table, and the kids managed to get me charged 0.99 for playing games on it, but a human took the order and I paid them too. I didn't notice if there was an option to pay on the tablet.


Kind of like a buffet place like Golden Corral, do you tip the person who comes by and says to let them know if you need anything? Since I never have that person do anything for me, I never leave tip. Not that I could anyway, you already pay when you come in and all I ever carry is debit card anymore.


--That's why they offer you cash back when you pay! I do tip at Golden Corral - not heavily, because the server does less than in a full service restaurant - but if they keep my soda refilled and keep the plates from piling up, they deserve a tip. If your servers are truly doing nothing for you at GC (e.g. plates and soda) then there's something wrong from the sounds of it!
David Wagner
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David Wagner,
User Rank: Strategist
6/11/2014 | 1:58:26 PM
Re: Love paying this way, hate ordering
@jastro- Ha! My least favorite are round objects or bottles or cans that are molded into shapes. The bar code never scans. And unlike someone who does it professionally, I don't have the experience to learn all the angles and tricks. 

Grocery stores have been experimenting with ways to checkout a whole cart at once (RFID tags would be one way). that is the kind of user experience that makes it worth it to the customer.
jastroff
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jastroff,
User Rank: Ninja
6/11/2014 | 1:55:18 PM
Re: Love paying this way, hate ordering
@dave - all good points! My local <fill in the blank drugstore chain> only has self-checkout. I so enjoy paying inflated prices for stuff I have to bag and lug myself. You must have been next to me at the <fill in the blank national grocery chain> when my fruit and veg purchases didn't register in the auto checkout aisle, and I was presented with a video display of fruit and veg pics. The self-check out is ok for things which are already coded with an item number, but otherwise they make me scream.
David Wagner
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David Wagner,
User Rank: Strategist
6/11/2014 | 1:17:02 PM
Re: Love paying this way, hate ordering
@TerryB- You are right. Tips will go down if they only become food runners. Plus, there will be fewer jobs. And unlike in IT when you free up time by doing things like moving into the cloud, you can;t say things like "we're freeing people up to innovate."
David Wagner
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David Wagner,
User Rank: Strategist
6/11/2014 | 1:15:06 PM
Re: Love paying this way, hate ordering
@michelle- You are right. Check-in is a place you see it a lot. I'm surprised more restuarants haven't tried computerized (especially mobile) call-ahead seating and reservations with the success of Open Table. 

The thing that distrubs me most about self check-in is that check-in is the moment you most want to see a face. You are likely to have the most questions. You want a sense that a person knows you are there. 

Still, I can see why it is the most labor intensive and most devoid of revenue gaining opportunities, that I can see how it is tempting.
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