McDonald’s is testing computer driven order taking at ten Chicago drive-thrus. It is a strong reminder that big minimum wage hikes accomplish little in the long run.
According to CEO Chris Kempczinski the technology is eighty-five percent accurate. Only about a fifth of orders need to be a taken by a human at those locations, he said, speaking at Alliance Bernstein’s Strategic Decisions conference.
Kempczinski said the technology will likely take more than one or two years to implement.
“Now there’s a big leap from going to 10 restaurants in Chicago to 14,000 restaurants across the U.S., with an infinite number of promo permutations, menu permutations, dialect permutations, weather — and on and on and on,” he said.
McDonald’s has also been looking into automating more of the kitchen, such as its fryers and grills, Kempczinski said. He added, however, that that technology likely won’t roll out within the next five years, even though it’s possible now.
“The level of investment that would be required, the cost of investment, we’re nowhere near to what the breakeven would need to be from the labor cost standpoint to make that a good business decision for franchisees to do,” Kempczinski said.
But the point is that they are moving in the direction of more automation. Companies may give lip service to social justice. The bottom line is king however. They are not going to sit idly by and pay a $15 per hour minimum wage while their margins erode.
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