What's Keeping Restaurant Executives Up at Night?
Our participants:
- Corey Kline, EVP, Noodles & Co.
- Hanson Li, Salt Partners
- Tom Seeker, CIO, Earl Enterprises
- 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 Universit
- Jessica Bryant, Vice President, Marketing & Inside Sales, NCR Voyix
- Courtney Radke, Vice President, Innovation,tSageNet
What are restaurants’ top 2024 priorities?
Tom Seeker, CIO, Earl Enterprises: Integrations between solutions to help with the labor shortage. Understanding our customers through AI and other tools to rapidly respond to industry changes.
Toby W. Malbec, Managing Director, ConStrata Consulting: Emphasis on fundamentals to maintain profitability: tight controls on food cost and labor with emphasis on exploring further avenues by which technology can positively impact both.
Natasa Christodoulidou, Professor, California State University Dominguez Hills: Mobile ordering, customer service and payment systems security.
Courtney Radke, Vice President, Innovation at SageNet: Restaurants are prioritizing resiliency and security as they evaluate their IT spend going forward. This is necessary to enhance customer experiences and boost operational efficiency, but also to maintain a competitive advantage by onboarding new technologies and creating new experiences at a faster pace than was possible before. This includes optimizing network infrastructure, adopting cloud-based solutions for scalability, building in security from the start and leveraging data analytics to drive decision-making.
What are the issues keeping restaurant executives up at night?
Corey Kline, EVP, Noodles & Co.: Traffic. Traffic. Traffic. We’ve all seen generally declining traffic for years, but looking back, there was enough room in price that our businesses didn’t truly feel the impact of the traffic declines. In 2023, the reality began to land for many and there’s little to no easily accessible room on the price side of the equation to ignore the declines any longer. This is challenging us to really understand the guests that are visiting our restaurants and those who aren’t so that we can identify the most practical, highest value areas to focus on in order to build back the visits we have lost. Many in the industry have established loyalty programs which have helped us to gain deep visibility into the preferences, desires and needs of an often high-frequency portion of our guest base. For those committed to reversing traffic declines, however, we are likely to learn that the areas that we need to focus most are those guests who do not identify themselves with every transaction and those guests who simply aren’t coming to our restaurants. It’s just math – it’s reality.
Hanson Li, Salt Partners: The increasing cost and decreasing availability of skilled kitchen workers.
Seeker: Cyberattacks. Employees clicking where they should not, and saying YES without reading the question.
Daniel J. Connolly, Ph.D., Dean, School of Business, St. John Fisher University: Rising costs, eroding profit margins, increased competition, labor issues, difficult customers, and ever-changing consumer trends are among the many issues keeping restaurateurs up at night.
Malbec: Rapidly rising labor costs and the silver bullet of tipping turning customer sentiments negatively.
Christodoulidou: Virtual security systems.
Jessica Bryant, Vice President, Marketing & Inside Sales, NCR Voyix: Brands are focused on reducing costs in every way possible through simplification and automation. They are looking to invest in ways that help them break free from their legacy technology and improve their employee operations.
Brands are looking to invest in ways that allow them to differentiate from their competition with frictionless customer experiences both inside and outside the restaurant. They are looking for an agile way to run their tech that can easily evolve with consumer demand and enable them to hyper personalize experiences to encourage more loyalty at a lower cost.
And finally, if you take a look at the enterprise technology architecture for most restaurant brands, it will look very messy. Most brands are trying to manage too many vendors and tech silos across their portfolio. The technology that they do have is integrated or not integrated in ways that can’t power the modern experiences they need to compete in today’s market. Brands want to be able to test and try new technologies quickly … without it making the rest of their tech stack unstable or having to rip and replace their existing core tech.
Radke: Labor management remains a concern. How do I run my restaurants effectively as attrition and changing industry dynamics stretch the workforce to never-before-seen levels. Technology can certainly be leveraged for staff augmentation, however that comes with its own set of challenges. The growing reliance on digital technologies makes restaurants vulnerable to cyberattacks, necessitating robust security measures and employee training to mitigate risks. This means restaurant executives are increasingly focused on cybersecurity threats and data privacy issues as a result of onboarding new technology that was deployed to try and solve other problems. It's a Catch 22.
What is the greatest disruptive force on the restaurant industry?
Kline: The proliferation of both the methods by which guests order and also consume, or handoff, the food from our restaurants continues to add complexity for our restaurant operators and challenges the concept of hospitality. We’ve seen multiple studies in 2023 that confirm what we’ve intuitively known – guests still value and expect hospitality… but even they struggle to articulate what that word means in an experience that is increasingly digital, off-premise and often involving third-parties. More than ever, I’m trying to wear my optimistic hat and that helps me remember that perhaps our greatest strength (superpower?!) as restaurateurs is solving problems. We’ve made great progress over the past few years in consolidating the operator experience despite the expanding order channels. And hospitality is in our DNA. It is a concept – a promise – that has always been changing. As an optimist, it is exciting to think about the experiences that we will see developing in the next few years.
Li: Automation.
Malbec: AI and the prudent (cautious) use of the tool to help with simple and complex business decisions.
Christodoulidou: Cryptocurrency.
Seeker: The economy. The economy. The economy.
