Key Learnings from McDonald's AI Drive-Thru Failure

Image Source: Forbes
Image Source: Forbes

In today's dynamic business environment, effective AI management is crucial for organizations to stay competitive and achieve their strategic objectives. Especially in the fast-food industry, where an order means a quick and convenient service, artificial intelligence can make or break the outcomes. In this context, McDonald’s’ rush towards the adoption of Artificial Intelligence into its service and then the discontinuation raise questions regarding the role and need of AI in the fast-food industry.

Artificial Intelligence Chatbots In Fast-Food Industry

The most rewarded function of AI in fast food restaurants is an automated order system. AI chatbots recognize the voice and enable a seamless conversation with customers to process automated orders. Such an AI-driven ordering system is expected to minimize error and guarantee customer satisfaction.

Moreover, fast-food giant McDonald's is using touchscreen kiosks to order food, assisting customers with reduced wait time and improved service. Whereas Domino’s Pizza leverages AI to record customers’ preferences to suggest orders. At the same time, Yum brand which owns KFC and Taco Bell is using AI to assist customers with innovative drive-thru ordering facilities and also announced this year that it will instil AI-first-mentality in the business. AI mechanism keeps previous ordering records and recommends the menu. Means, leveraging AI enhances overall customer satisfaction and enhances services.

Rush Towards Automation

The reason behind the rush towards automation is the countless technologies out in the market and the more awaiting rolling out. Incorporating a robust technology system pushes companies to solidify their business model. On top of that, in the battle for automation, firms are going through a strong digital transformation process, motivating others to join in.

In this context, a report published by the National Restaurant Association is essential where it cited competition and cost as the reasons behind this rush toward AI implementation. This shows 45% of operators are expecting an intense competition in 2024 than the previous year, whereas 98% of operators believe labour cost is a burden on restaurants whereas 97% say it to food costs. At the same time, 38% claim their business was not profitable last year.

Misunderstanding Customer Orders

However, McDonald’s didn’t give any reason behind rolling in its test run. But it’s supposedly driven by various factors including discomforts faced by customers, less customer satisfaction, and social media, to name a few. On the wrong order being placed through automated chatbots, customers shared funny videos through online portals saying AI multiplying the number of orders or adding items. And, in this world of social media where everything happened to become a meme, several memes made on the brand surfaced online.

The service sector

For companies, AI is a means to replace human labour to reduce costs and maximize outcomes. Last year December, McDonald’s and Google together cracked a deal on developing a chatbot named “Ask Pickles” for employee training purposes. They also agreed upon leveraging generative AI for other potential work, as per Bloomberg.

Food Service Industry – Future of Employment or Layoff?

According to a report published by the Association, the foodservice and restaurant industry have a great future in 2024. The sale is forecasted to get a $1 trillion historical hop. Also, the industry is the second largest private sector to provide employment chances and is going to add 200,000 jobs ahead with a total 15.7 million of people employed. According to the report, 45% of operators require human faculty to fulfil customer demands.

However, operators are using more technology to handle challenges, lower labour costs, save money, and grow their businesses. They are applying tech solutions to areas like marketing, hiring, accounting, and inventory management. This progress is certainly a threat to the growth in employment opportunities.

Also, when choosing between people and technology, consumers still prefer human hospitality in their dining experiences.

McDonald’s Rolling In AI Drive Thru. Right or Wrong?

The decision taken by McDonald’s to roll in the trial of AI-run Drive-Thru has highlighted limitations with the current trained model and improvement opportunities as AI entails better learning and model training implementation, enhancements are expected to overcome such limitations and improvement opportunities. However, McDonald’s seems to be determined to close the matter sooner.

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