Technology
How AI will save the restaurant industry
January 3, 2022 by Paul Rubin — Chief Strategy Officer, PAR Technology
You know restaurant technology is becoming a very big deal when it goes viral on TikTok. In November, a user of the popular video-sharing social network uploaded a clip of a robot server delivering breakfast to his table at a Denny's. As of this writing, the original video has garnered over 571,000 views and has been shared more than 2,700 times.
That same week, an Illinois-based tech firm called Nala Robotics made headlines when it launched what it touted as the world's first fully-automatic robotic kitchen. Powered by artificial intelligence and machine learning, Nala's robot chefs can prepare millions of recipes from around the world, all without any human intervention.
Social media and news sites love these sorts of stories, so when big chains like Chick-fil-A partners Sodexopartner with a robotic-delivery company, it gets a lot of coverage. It seems like pretty soon the machines will take over all the jobs in the restaurant industry — and perhaps beyond. Today the drive-thru, tomorrow the world? Not so fast. As the old maxim states, people tend to overestimate what can be done in one year and to underestimate what can be done in five or 10 years. Automation isn't going to put the entire hospitality industry out of work in the near future; the fact is, though, that AI can help make for a better dining experience for staff and patrons alike.
(In the interest of hedging my bets, however, I would like to say for the record that I for one welcome our new robot overlords. I'd like to remind them that as a trusted CSO, I can be helpful in rounding up others to toil in their underground ghost kitchens.)
The tip of the iceberg
Artificial intelligence has already penetrated most areas of the restaurant business in some capacity. When you consider that the global AI market is predicted to snowball in the next couple of years to a market value of $190.61 billion by 2025, this is clearly just the tip of the iceberg.
According to one recent report, more restaurants in the U.S. are warming up to the idea of using automation technology, with 50% of them planning to implement the technology in the next two to three years.
One of the main reasons restaurant operators cite for moving toward more automation is the need to fill in labor gaps. It's not news to anyone reading this that the industry has been in a labor crunch for some time now. According to the Bureau of Labor Statistics, the quit rate among hospitality workers recently reached 6.8%, more than double the national average, and full-service restaurants are operating with 6.2 fewer kitchen employees than they were in 2019. Technological solutions that ease labor pressure have become essential tools.
The key role of data
The restaurant industry is no longer a space in which being technologically conservative is a sound strategy. In a comprehensive forward-looking report titled Restaurant 2030: Actionable Insights for the Future, the National Restaurant Association (aka the other NRA) highlights the key role that data will play.
"For a long time now, restaurants have known that they need to get more innovative… and fast," the report says. "Technology and data allow for quicker consumer response, and restaurants will need to be nimble. Restaurants will need to embrace new ways of using data and information to keep up—or get left behind."
The NRA further notes that restaurants will continue to find new ways of applying data analytics "to predict and capitalize on consumer demand and optimize supply economics". The success of any AI-powered tech is, of course, dependent on data—the bigger the data set, the more accurate the AI's predictive functions become, and the faster it learns.
Competition for tech talent
So, while machines might indeed replace some human employees, technology will actually create new opportunities for those with the right skills. The demand for those skilled workers will create an environment in which, the NRA predicts, "restaurants will compete with other industries for tech talent. Benefits will be critical to recruiting and retaining employees. Technology-based training, certifications, and internal career paths will be increasingly important tools to retain valuable employees."
This is all good news for workers, and those increased labor costs—combined with real-estate costs, rising commodity prices, and other factors—will give operators strong motivation to automate routine back-of-house tasks in their kitchens and bars, as well as escalate the use of kiosks and digital ordering.
Again, those are among National Restaurant Association's predictions for the state of the industry in 2030, but in reality, all of those things are in play right now. AI already provides a number of "micro-solution" opportunities for restaurant operators—think of everything from staffing and scheduling to customer loyalty programs — and those solutions will only grow more powerful as the technology advances.
Yes, the robots are coming — and some of them are already here — but the restaurant industry will still need the creativity and skill of talented human beings to propel it into the future.
For now, anyway.
About Paul Rubin
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