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
6/12/2014 | 1:49:41 PM
Re: Love paying this way, hate ordering
@Susan- Historically, these switches don't mean lost jobs. They create jobs elsewhere. When the airlines switched to self-service kiosks they eliminated desk people, but needed more back office people including IT.

However, as the backoffice gets more efficient with the use of technology (especially the cloud) i think it might be time to really redefine what these moves mean to jobs. I'm guessing if not now, in the ocming decades we really are going to be making it difficult to come up with a enough jobs for the people we have.

And we are already taxing the economy because we lack the skilled and edeucated workers for some roles and those unlucky enough to not get the right educaiton are stuck out in the cold.
Susan_Nunziata
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Susan_Nunziata,
User Rank: Strategist
6/12/2014 | 1:46:28 PM
Re: Love paying this way, hate ordering
@Tom: This is especialy true when said customer is the only thing standing between me and a cup of coffee:

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.

:)
Susan_Nunziata
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Susan_Nunziata,
User Rank: Strategist
6/12/2014 | 1:43:40 PM
Moving toward a self-service world
@Dave: You've captured both the benefits and drawbacks of retail attempts at self-service. I always hated checking out my own groceries because the system was just awful. I like the idea of menus on tablets, especially if nutrition information and ingredients are easily accessible.

What I'm curious to know, though, is how you see this extending into the internal operations of an enterprise. For example, I know many IT organizations are looking to move toward a self-service model for things like buying and provisioning laptops and smartphones, and Intel even has vending machines in its offices where employees can use their ID cards to "purchase" USB sticks, cords, earbuds and other accessories.

Waht is the future of self-service for the IT organization? Will meeting employees' hardware needs ever become as simple as ordering  Chili Cheese Fries from a tablet app?
Susan_Nunziata
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Susan_Nunziata,
User Rank: Strategist
6/12/2014 | 1:38:23 PM
Re: Love paying this way, hate ordering
@Shane: Whiel I agree with this in theory, I am concerned about it in reality. quick-service and fast-casual restaurantes are a big source of employment for people, they tend to be larger than the more sophisticated dining establishments, and employ far  more waitstaff. What will happen to these jobs if our ordering process becomes as simple as getting cash out of an ATM machine, with no human intervention required?

 
Susan_Nunziata
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Susan_Nunziata,
User Rank: Strategist
6/12/2014 | 1:35:25 PM
Re: Love paying this way, hate ordering
@JGherbert: Is that a barcode on your banana, or...?

(sorry, couldn't resist the lame attempt at a joke)

In all seriousness, I'm signed up right now with this program to receive a box of locally grown farm-fresh produce every two weeks delivered to my door. I never know what is going to be in the box, and there have been veggies in there that I have never met before. I often find myself googling not only to identify the things but also to find recipes to make use of them. So, I think your idea is a great one for home use--would definitely save me a few steps if there were a QR code included on the bands that hold the produce for example. (don't think i'd like to see such a thing imprinted on the actual produce itself, though).

 
jgherbert
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jgherbert,
User Rank: Ninja
6/12/2014 | 1:21:48 PM
Re: Love paying this way, hate ordering
>jgherbert not sure if you were joking here or not, but I think the check-out at a grocery store--or any store is the last place a shopper is going to stop to get a recipe or check out a website. : )

@soozyg:I'm not entirely serious. However, most people with a smart phone have (or can easily get) a QR code reading app. Then when you see Kumquat, rather than searching the web for it, you can simply scan the QR code and get curated information and recipes (featuring the store's own brand products, most likely ;-). Ok, you don't need to have that QR code grown in the skin for that to work, but what about when you're at home thinking "Hmm, what can I do to make this banana more interesting?" you could look then.

In fact, with the right app you could scan bar codes of all that fruit, veg and meat in your fridge and get recipes featuring those ingredients. Having bar codes on fruit and veg would make that rather sad process easier. Not to mention the attempts at automatic fridge stock tracking / shopping list creators.

 
Shane M. O'Neill
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Shane M. O'Neill,
User Rank: Author
6/12/2014 | 12:40:54 PM
Re: Love paying this way, hate ordering
@David Ok maybe "ambiance" was the wrong word. I was equating ambiance with the sophisticated aura of a high-end restaurant. But you're right, every place has ambiance -- even fast food restaurants need a look and feel and sense of place. But the service staff at low- and mid-tier places are not needed so much if technology is better at serving customers. At a more refined restaurant, the menu is elaborate with specials that may need explaining. Also, you're spending more money and dining there is usually a special night out. So you want that human connection as part of the experience. I don't really need that connection when grabbing lunch at Chili's if a kiosk is more efficient.
David Wagner
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David Wagner,
User Rank: Strategist
6/12/2014 | 11:40:17 AM
Re: Love paying this way, hate ordering
@soozyg- There is an option on the Chili's one to signal waitstaff. I assume that will be standard on all of these moving forward but I'm sure each is proprietary. 
David Wagner
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David Wagner,
User Rank: Strategist
6/12/2014 | 11:39:22 AM
Re: Love paying this way, hate ordering
@vnewman- I would have thought so. But perhaps service has never been one of those things. I have to say, I get more bad service than good service at mid-tier restaurants. Maybe the restaurants are just tired of the mediocrity. Maybe if they, you know, paid them, instead of relying on them getting tips, they'd get better service folks.
soozyg
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soozyg,
User Rank: Ninja
6/12/2014 | 11:38:49 AM
Re: Love paying this way, hate ordering
We'll always need people there to answer the non-obvious questions like "is this cooked on a grill with meat" or similar though. 

Is there an option on the screen to signal waitstaff? That would be an interesting feature.
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