While fast-food chains across the US are making major investments in delivery, mobile ordering, and employee-replacing robots, many companies are forgetting the most important part of business – the customer.
“What I see with a lot of QSRs is ‘me too,'” Chris Caldwell, KFC’s chief information officer, told Business Insider in an interview about tech in the quick-service restaurant business. “They’re doing it because someone else is doing it. They don’t really understand the results, or what they’re going to achieve, or what the consumer pain point is. And I think that’s a dangerous place to be.”
When it comes to tech, KFC isn’t necessarily aiming for the cutting edge – a position taken by some of the chain’s competitors with “me too” attitudes. Instead, Caldwell says the brand is focusing on areas that may be less flashy.
The most recent of these: mobile payment. The chain has quietly begun rolling out mobile pay, with system-wide adoption expected to be complete by the end of the summer. While KFC doesn’t have a mobile app, with the new payment system, customers can pay with Apple Pay, Android Pay, and Samsung Pay both in stores and at drive-thrus.
- Hollis Johnson
According to Caldwell, the change was inspired by the need to update payment infrastructure to increase security.
“If we’re going to make a massive change like this, we might as well make sure we support the mobile pay options,” says Caldwell.
Caldwell says that he expects mobile payment to improve speed of service, especially as more locations switch to the slightly more time-consuming EMV chip card payment. Perhaps more importantly, it’s an update that allows the chain to be prepared for the future, but not one that requires a major investment in an area that remains unproven in the fast-food industry.
“It’s dangerous to jump in with both feet and not know the consumer pain point you’re solving for,” says Caldwell.
The chain is taking a similar approach to delivery, currently testing DoorDash delivery at around 125 locations in Los Angeles, Houston, Chicago, and the San Francisco Bay Area. By partnering with DoorDash, KFC has the option to collect data on delivery and what customers want from it, without making any major investments of it’s own – a win-win, money-saving solution.
Meanwhile, KFC is investing in tech that most consumers will never notice, with a recent initiative to implement technology that makes life easier for workers. The chain plans is planning on testing new tech related to the less-than-flashy issues like inventory and scheduling shifts to 20 to 30 locations in the coming months.
“The cost of labor is a challenge for us where we’re looking for creative solutions,” says Caldwell. “Some people would jump to kiosks for labor reduction… I think we can make our restaurant managers more efficient using technology.”
KFC’s investment in employee-centric tech comes at a time when the issue is particularly fraught, both at KFC and in the fast-food industry more broadly.
- Hollis Johnson
A number of current and past fast-food executives have recently addressed the belief that increased minimum wages will result in the loss of entry-level jobs, as employees are replaced by burger-flipping robots and kiosks.
“It’s cheaper to buy a $35,000 robotic arm than it is to hire an employee who’s inefficient making $15 an hour bagging french fries,” formerMcDonald’s USA CEO Ed Rensi said in a recent interview.“It’s nonsense and it’s very destructive and it’s inflationary and it’s going to cause a job loss across this country like you’re not going to believe.”
Then, there’s executives providing a counter-argument: that new technology is going to be key to improving customer service.
“I don’t see it being a risk to job elimination,” McDonald’s current CEO Steve Easterbrooksaid in May at McDonald’s annual meetingwhen asked if rising labor costs would force the chain to cut jobs. Instead, Easterbrook said, the company would look to automating food preparation, allowing more employees to work directly with guests and boosting customer service.
- Kate Taylor
This pro-technology, pro-customer service conception of innovation seems to be shared by KFC. The fried chicken chain is in the midst of a major operations reboot, with ‘Re-Colonelization’ – a public recommitment to quality in locations across the US.
In the last year, the chain has spent more than 100,000 worker-hours retraining more than 20,000 employees. KFC held 43 rallies across the US, attended by more than 97% of restaurant general managers, in addition to national training events at every KFC location in the US.
While there may be more headline-grabbing changes when it comes to tech in the world of fast food, employees’ ability to make food consistently and quickly is, ultimately, what makes or breaks a chain.
Delivery may be a nice bonus, but, at this point, there’s no evidence it can significantly boost a fried chicken chain’s sales. The same can be said of mobile ordering or apps. However, KFC has plenty of evidence that poor employee performance can – and has – hurt the chain’s reputation and sales, as the chain struggles to compete with customer service-champion Chick-fil-A.
“Everybody has their theory about what [technology is important], but I think it goes back to seeing what the benefit would be – and not just doing it because it’s something everybody is going to do,” says Caldwell.