Restaurants Share Opportunities for Future Innovation, Underrated Tech

For the 2024 Restaurant Industry Outlook, HT asked restaurant executives and restaurant technology industry insiders about operators' top tech priorities, opportunities for innovation, underrated tech and much more.

Part one focused on what's keeping restaurant executives up at night and top tech priorities for 2024. 

Our participants:

• Corey Kline, EVP, Noodles & Co.
• Hanson Li, Salt Partners
• Natasa Christodoulidou, Professor, Department of Management and Marketing, College of Business Administration and Public Policy, California State University Dominguez Hills
• Daniel J. Connolly, Ph.D., Dean, School of Business, St. John Fisher University
• Tom Seeker, CIO, Earl Enterprises
• Jessica Bryant, Vice President, Marketing & Inside Sales, NCR Voyix
• Courtney Radke, Vice President, Innovation at SageNet

What technologies should restaurants be looking to embrace?

Li: 1. Kitchen automation 2. Enterprise software with a good user interface that encourages users - from line staff to managers - to actively use the software for productivity gains.

Connolly: Four main areas come to mind:

- Overcoming labor issues (both rising labor costs and worker shortages)

- Achieving efficiencies and cost reductions to combat inflation

- Protecting customer data and technology assets due to rising security concerns

- Using technology in ways that will create customer convenience and loyalty

Malbec: Anything that makes them more business-efficient.

Christodoulidou: Independent delivery services.

Bryant: ... We believe that successful, growing brands are going to win against their competition by truly owning their guest and staff experiences – both digitally and on premise. To do this, we believe that one of the biggest areas of tech restaurants will be investing in is platform-based technology… made up of reusable components and helps restaurants become more adaptable and agile, easily integrate and try new innovation.  It also enables restaurants to centrally manage all first- and third-party omnichannel data, gain greater visibility into all tech touchpoints and lower their costs.

Radke:  Restaurants should prioritize technologies that enhance customer engagement, streamline operations, and improve data security. This includes investing in secure SD-WAN for resilient and intelligent network connectivity, AI for quicker decisioning and hyper-personalization, IoT for smart restaurant management and operational efficiency, and blockchain for transparent supply chain management

What’s the most underrated tech?

Kline: I have long been a supporter of investments in connectivity and infrastructure. It really is the circulatory system of our restaurants. In years past, instability in these areas was inconvenient – perhaps even highly inconvenient. Resolving issues could not only take a while, but often required assistance from restaurant team members which then detracted from their ability to focus on the core business. But now, lack of connectivity impacts – what for most brands is – the largest collective source of revenue. By making connectivity and infrastructure a strategic priority, technology leaders can protect a significant portion of restaurant revenue, preserve restaurant and support team capacity for more guest focused efforts and provide the platform for almost every other strategic revenue building effort that is usually making the headlines.

Li: Smarter kitchen equipment.

Malbec: Digital menu boards, especially at the drive-thru. Their ability to personalize the guest experience is a secret weapon.

Seeker: The pencil. It never runs out of batteries. It works when the power is out, and it is very quiet. It is also very inexpensive. It may sound weird coming from a CIO, but it’s the right tool for the right job and a great backup when you lose power or the internet!

What’s the most overhyped tech?

Li: Robotics.

Malbec: Kiosks: Everyone carries their own kiosk. It’s called a mobile phone.

Seeker: AI. It’s not new. Just new to the average joe. Now we have AI fatigue. It is great, but must be well planned. Data several years old in the large language model makes real-time actions difficult.

Where do you see opportunities for future innovation?

Kline: AI was definitely the headline of 2023, and it has been interesting to see the earliest attempts to layer these capabilities into the restaurant technology landscape in meaningful ways. I am particularly interested in how AI and wearable technology may intersect to empower our restaurant teams. A particularly intriguing idea is a solution that would enable team members to identify (and correct) accuracy or quality issues during the preparation of an order. This could be anything from missing modifications to forgotten items to temperature issues. 

Malbec: Better decision-making through leveraging native and third-party data to make resourcing, product mix and pricing decisions. The restaurant industry may need to slaughter some sacred cows in order to stay relevant.

Christodoulidou: Service robots that work.

Seeker: Integration of legacy solutions with new solutions via the proliferation of AI.

Where has technology been underserved?

Li: Independent restaurants or smaller chain's kitchen operations.    

Malbec: Training – we should have VR training courses with VR learning modules widely used in the industry – and there are few if any to be found. 

Radke:  An area that is woefully underserved in the restaurant industry is the network. It is very hard to launch the experiences of tomorrow with the network of yesterday. And by yesterday, I mean 10+ years ago for many restaurants. There is a lack of attention to bandwidth optimization (SD-WAN), coverage diversity, security implementation, integration with emerging technologies, and scalability planning. The network of today needs to be "Always On,” meaning, you can't just focus on is my connection up or down, but rather is the experience that I want to provide resilient and protected as a byproduct of my investment in network infrastructure.

In the wake of increased data collection and desire for personalization, what technologies should restaurants be looking to?

Li: Customer-centric marketing and loyalty.

Malbec: Any and all that mimic the consumer experiences. The customer has grown to expect – in the retail sector – one-to-one marketing, improved delivery visibility, and dynamic pricing and promos.

Managing costs is a perennial challenge. How do operators boost profitability in 2024?

Li: Use machine learning/software to more quickly detect deviations from budget ... the software should be a coach to the manager. The software should not be a passive repository of reports. We should demand our enterprise software vendors to provide “so what?" vs. just more data and reports.

Connolly: Restaurants will continue to explore ways to creatively use artificial intelligence, robotics, and tools that empower guests to serve themselves. Expect to see technology investments that are largely behind the scenes; for example, kitchen operations, supply chain management, administrative tools, and security infrastructure. Restaurateurs should invest more in data analytics tools to harness the data they have been collecting in order to create more effective and compelling marketing promotions that will lead to repeat business and increased customer spend. Unfortunately for consumers more restaurants will likely try to pass on costs through service fees, surcharges for credit card payments, etc.

Malbec: Better tools, stronger business processes and better training for managers. Don't underestimate the value of tenured managers who understand the business challenge. Too many organizations promote high performers out of the restaurants into management positions. Put them back into senior operational positions NOW so they can mind-meld with new managers.

Christodoulidou: Offer the quality customers deserve.