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 | 6:04:53 PM
Re: Love paying this way, hate ordering
You don't go to these places for the ambience or social interaction. You're there to eat. And the exchange is rarely complicated enough that human interaction is needed -- unless maybe when little kids are involved. 


@Shane- Allow me to play devil's advocate. If ambiance and service don't matter at mid-tier restaurants why are they hiring all the perky coolege kids who dance or sing or wear clever buttons or look good in barely anything? If the ambiance doesn't matter, why are they buying all those antiques or theming to music or movies or sports?

It seems like for many mid-tier restaurants that is ALL that matters. Maybe they've been making mistakes all along and it doesn't matter.
Shane M. O'Neill
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Shane M. O'Neill,
User Rank: Author
6/11/2014 | 5:40:39 PM
Re: Love paying this way, hate ordering
Kiosks or tablets for ordering/paying make perfect sense at mid-tier chain restaurants. You don't go to these places for the ambience or social interaction. You're there to eat. And the exchange is rarely complicated enough that human interaction is needed -- unless maybe when little kids are involved. I don't mean to dehumanize the situation and food servers will surely lose their jobs, but touch-screen ordering, if done right, is a win for the customer (order meal and pay more efficiently) and the restaurant (boost revenue).
Thomas Claburn
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Thomas Claburn,
User Rank: Author
6/11/2014 | 4:24:11 PM
Re: Love paying this way, hate ordering
I've seen iPads as self-service ordering devices done well in San Francisco eateries. But the app UI/UX has to be exceptional. One thing more frustrating that being in line behind someone taking a long time at a cashier is being in line behind someone taking a long time with a self-service device due to technological confusion.
jgherbert
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jgherbert,
User Rank: Ninja
6/11/2014 | 4:00:05 PM
Re: Love paying this way, hate ordering
And the doctor says, "I'd turn him around so it looked like he was coming in." 

*laughs* I like that ;-)

I can't recall, but I'd bet that when you do the check-in process, you also release the from liability. That's a pure guess, but it's what I'd do!
David Wagner
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David Wagner,
User Rank: Strategist
6/11/2014 | 3:55:44 PM
Re: Love paying this way, hate ordering
@jgherbert- I'm not familiar with the company, but there's an awful lot of construction going on at my two nearest pharmacies so I'm guessing I soon will be. 

I still think they better be highly insured for the first time that someone dies in their waiting room. 

Reminds me of the old joke about a doctor giving a lecture at a medical school and he's asked the quesiton: "What would you do it a patient was just leaving your office and suddenly dropped dead?"

And the doctor says, "I'd turn him around so it looked like he was coming in."
jgherbert
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jgherbert,
User Rank: Ninja
6/11/2014 | 3:47:59 PM
Re: Love paying this way, hate ordering
"I feel like that's what people are for in a technological world-- to cover times when computers aren't ready to do it yet."


You are undoubtedly correct. Just like we'll always need somebody in a restaurant, it's helpful to have a face. My guess - and it's just that - is that the financial model of something like Minute Clinic is based precisely on it being a self-service check-in, so they don't have to employ anybody to do it. In this particular case, Minute Clinic is not a company owned by CVS - they are a true concession within the stores, and totally self-contained, so they're also missing the ability to get that resource from, say, the pharmacists or the shop staff as part of the existing overhead.

This is a really interesting discussion. It certainly raises some fascinating questions about how our experience may change in the coming years.
David Wagner
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David Wagner,
User Rank: Strategist
6/11/2014 | 3:45:19 PM
Re: Love paying this way, hate ordering
 

That might be nice in addition to an on-table tablet offering, but if you make it exclusive to smart phones you automatically create a Have versus Have Nots situation and offer (effectively) prioritized service to those with phone hardware capable of using it to order, and I can't help feeling that this might alienate a certain proportion of the customer base.

@jgherbert- I don't look at it as an advantage so much as an add-on. The server is still there for the phoneless. But I get your point. You need to make sure you market it so it doesn;'t make you feel like you are missing something for not having your phone. 
David Wagner
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David Wagner,
User Rank: Strategist
6/11/2014 | 3:41:56 PM
Re: Love paying this way, hate ordering
@jgherbert- Fair enough. I think they do have a ton of experience. But you are right that this is 1% situation. but I feel like that's what people are for in a technological world-- to cover times when computers aren't ready to do it yet.
jgherbert
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jgherbert,
User Rank: Ninja
6/11/2014 | 3:41:03 PM
Re: Love paying this way, hate ordering
"Why can't I use my phone to get ribs at Chilis while i'm at the table?"

That might be nice in addition to an on-table tablet offering, but if you make it exclusive to smart phones you automatically create a Have versus Have Nots situation and offer (effectively) prioritized service to those with phone hardware capable of using it to order, and I can't help feeling that this might alienate a certain proportion of the customer base.

I do agree with the earlier comment about being able to use your phone to reserve a table though, so perhaps I'm in favor of giving advantages to smart-phone owners after all!
jgherbert
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jgherbert,
User Rank: Ninja
6/11/2014 | 3:37:42 PM
Re: Love paying this way, hate ordering
"I get the value of the check-in from a fiscal point of view, but in a healthcare setting shouldn't a person lay eyes on a patient immediately? What if someone stumbles in with a gun shot wound or small pox and they don't know it isn't just a rash?"

I look at it like when I call my family practitioner out of hours and the outgoing voicemail message begins with "If you are having a medical emergency, hang up and call 911." You have to have the common sense to know when it's appropriate to visit a Minute Clinic or other service aimed at very minor ailments, versus going to the ER.

I don't know - beyond obvious things like an ax handle sticking out of your cranium - whether the average doctor's receptionist is truly able to do eyeball triage anyway. The most they'd likely do is ask you not to bleed all over the carpet please; they're unlikely to identify small pox I would think? Maybe I underestimate their medical training! :)
<<   <   Page 6 / 9   >   >>
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