These are crazy, unique times. Everyone knows this. Yet, all great leaders also know that crazy, unique times offer the very best opportunity to expand business and build upon strengths. This assumes that you have a differentiated product and experience, capital to grow, and a clear path to get there. Even in a pandemic and challenging times, there is FLOW – the changing dynamics of business. There is FLOW in work, manufacturing, agriculture, and yes, especially in technology. I believe there is a FLOW building in technology….and it is a wave that is coming. The question is, “Who will lead the way and how much will they gain by catching this wave?”
Recently, I sent a note to a CIO. It read: “If going digital was the prescription to survive and thrive in this new world, then the next frontier to drive sales and optimize guest experience and profits consistently will be AI and insight analytics. DARE TO LEAD!”
Over the past 30+ years of operating restaurant brands (Taco Bell, Noah’s Bagels, Jamba, Freebirds, and Blaze Pizza), I have often anticipated “what’s next” and then tried to lead the way. Sometimes, I was certainly on the bleeding edge versus the leading edge. Yet, these experiences have all the more strengthened my belief that it is always important to look towards the next horizon and find your path towards that next technology frontier that can improve your performance.
Way back in the early 1990s, we worked on graphical user interfaces (GUIs) and developed some of the first food cost optimization and labor scheduling solutions using GUIs. It saved us 2 to 3 points on the P&L. That was huge! POS adoption was swift thereafter as were “back office” systems to help managers with the daily tasks of the business. The mid 1990s and the first decade of the 2000s brought the industry more sophisticated back office systems, above store reporting systems, and even the start of leveraging handheld devices for ordering, inventory, etc.
To keep things simple, I have always bucketed restaurant technology into 3 main areas:
- In-store systems such as time clock and hourly/management payroll, labor scheduling, ordering, Point-of-Sale (POS) and Kitchen Display Systems (KDS) and drive-thru or drive-up lanes for digital ordering.
- Above store systems for collecting and analyzing transaction data from POS for sales, COGS, Labor, other controllable expenses, occupancy, and all elements of profitability.
- Customer-facing technology including social engagement, 3rd party delivery, brand-specific apps, loyalty, customer experience and communications (text, email, social), post-visit experience, etc.
During the past 10 years, we have seen the growth of technology across all 3 areas, but the greatest impact has definitely been in the 3rd bucket: Customer-facing technology. This area will continue to grow and enable businesses (and especially restaurants) to improve their Customer Experience (CX) and deliver their “value” more consistently.
Today, there is a new frontier, a fourth bucket, and it is a powerful force with only a few restaurant chains truly “dipping their feet” into the water. This next frontier or new body of water is Artificial Intelligence (AI). The water is warm, it is easy to enter, and it offers so much especially for early adopters. AI is here and it is ready for prime time. Instead of just looking in the rear-view mirror as reporting systems always have, AI brings diagnostic, predictive, and prescriptive capabilities to the table. This means that restaurant chains can price better, execute more effective promotions and campaigns, optimize inventory, labor, and food costs, while running more efficient stores and digital channels.
Best of all, best-in-class AI solutions can understand plain English, whether with voice recognition or simple text. These AI solutions can replace huge investments in “data cubes” and expensive software. It can exist without a team of dedicated technology professionals or data analysts in your office. It provides unprecedented power to your marketing and finance and operations teams….NOW.
So, why would a recently retired restaurant CEO have a point of view around artificial intelligence?
For the past several years, I have gotten increasingly involved in investing in, and supporting interesting young start-ups. I have had the opportunity to serve on a couple of Board of Directors, and I have also had the opportunity to mentor some young entrepreneurs. One company that caught my attention is Hypersonix.
Hypersonix offers restaurants a unified, AI-Powered Intelligent Enterprise Platform enabling profitable revenue growth. It’s built with the latest AI innovations around machine learning and plain English language understanding, to provide a full array of descriptive, diagnostic, predictive, & prescriptive intelligence – all purpose-built for the restaurant industry. Restaurant chains that use Hypersonix understand what’s happening in their business, why it’s happening, and what they can do about it.
For example, for 25+ years, as a restaurant leader, I wanted to ask and get answers to questions like:
- What is the price elasticity of add on items like soda, fries, sides, etc? Should we raise or lower this price and what flows?
- What is the price elasticity of my entrees? How do I offset food and labor cost increases with the best mix of price changes on my menu?
- How did Promotion A compare to Promotion B with respect to sales, profits and shift of mix?
- What can I learn from the best restaurants running tighter labor and better guest metrics?
- How can I truly compare metrics from disparate datasets to better understand what restaurants are balancing the need for great guest scores, sales maximization, cost management, etc., while always serving their team members too?
It has been gratifying to see how impactful Hypersonix has been for its restaurant customers, especially around optimizing prices, promotions, inventory, labor, and food costs. They are helping restaurants transition from brick and mortar enterprises to digitally-enabled enterprises, all with an eye towards better serving the customer.
If you haven’t had the opportunity to see Hypersonix, or if you are interested in learning more about how artificial intelligence can lead to a brighter future as that next horizon approaches, you can arrange a demonstration by clicking here, or you can direct message me and I will tell you more.
Thanks,
Jim Mizes
