Next month, all eyes in the foodservice equipment and supplies space will be on Orlando, Fla., thanks to the biennial NAFEM Show. This event will be all about the products and the innovative ways we, as foodservice professionals, use them. While the show does a wonderful job of shining a spotlight on foodservice technology, other market factors, such as the new healthcare legislation and the never-ending drive to enhance productivity, continue to increase awareness in this area.
What factors should motivate a foodservice operator to invest in new technology?
Applying new technologies is often a glorious exercise. It can bring buzz to the concept and impact the value of the brand, even before it is implemented. We witnessed this phenomenon several weeks ago when a casual dining chain made an announcement about several technological applications it is considering to reduce labor costs and drive profits. This announcement made lots of industry headlines and undoubtedly foodservice professionals will continue to monitor the progress the concept makes in these areas.
But any new applications introduced into a foodservice operation needs to have a specific purpose — one that addresses a business requirement. Applying technology for technology's sake is often not a good idea, and it can result in unintended consequences to the foodservice concept, which can impact the guest experience and the operation's profitability.
The primary reason for investing in new technology is to make the concept better.
Some of the drivers can be improvements in the following areas:
- Customer Service and Hospitality
- Labor Efficiency and Labor Cost
- Product Quality and Consistency
- Menu Innovation
- Operating Costs
- Capital Costs
- Facility Size
- Food Safety
What's the biggest mistake foodservice operators make when introducing new technology to their business?
Restaurants are like snowflakes: no two are the same. Because every operation is unique, it is important to thoroughly evaluate any new technologies before actually implementing them. That's why one of the biggest mistakes a foodservice operator can make when introducing new technology is not comprehensively testing it in a disciplined and holistic way. It is wrong to assume that a piece of equipment will impact an operation in a manner that was similar to other like concepts. Often an application of the same technology can drive very different results across different concepts. This does not mean that testing and validation has to be a drawn out process, but it has to be carefully conceived and managed. Any testing and evaluation process should consider the realities of the business, specifically at the unit level. Testing in a lab, under the theoretical conditions that the restaurants should be executing, can result in unintended results due to the realities of the operational dynamics at the unit level.
What steps should I take in researching new foodservice technology?
When researching new technology it is critical to specifically define the issue(s) that the foodservice operator wants to resolve. Simply put, you can't move forward with evaluating potential solutions unless you know what you want to accomplish. The introduction of new foodservice-related technology often involves and can impact multiple areas of the concept. While a new technology can impact an area positively, another area could be impacted in the opposite direction, if not carefully researched and implemented. For example, a piece of equipment that drives cooking speed on one item, could result in a degradation of quality of other menu items, due to the slower speed required to prepare the other products that constitute the order. Foodservice operators need to understand these types of dynamics prior to implementing any new solutions.
Some pieces of equipment pledge to solve a lot of my business challenges. How can I tell the truth from the marketing hyperbole?
Run away from technological innovations that claim to solve all of your challenges in one tidy package. At the end of the day, the foodservice operator has to apply the "trust but verify" rule, where the information from the technology supplier is taken into consideration, but is shaken down with real life testing. This is the only way to truly separate fact from fiction and navigate through the marketing aspect of the new potential technology application.
If we plan to add a new menu item, is new technology necessarily required?
Menu innovation is a must in the current competitive business environment. Take a look at various menus within the foodservice industry and it becomes difficult to differentiate one concept from another. The homogenous nature of today's menus is driven by the operators' desire to generate as much traffic as possible across multiple day-parts. Or, to put it another way, operators are trying to capture a larger share of their consumers' stomachs. This dynamic can be a catalyst for introducing new technology to a foodservice operation, since the right technology can help simplify the complications brought on by menu expansion. New technology can provide ways for the staff to deliver the new menu items more consistently and maintain efficient operational execution.
Having said this, new technology is not always necessary to deliver new menu items. As a matter of process, it is the fiduciary responsibility of foodservice operators to determine if the current technology available within their four walls, so to speak, can deliver the desired menu innovation or if new technology is warranted to deliver the product in the most effective and efficient manner possible. This is especially true in a franchised system, where the brand owner has to count on other people's money to get the new menu items and technology implemented. Even for brands that are fully company operated the same rule should hold true. The reality is that at the unit level, the best brands view their company operations teams as like a franchisor, which means the same rules should apply. At the end of the day you have to show the frontline folk, meaning those running things at the unit level, the money in the form of a positive return on investment (ROI). One way to enable higher ROI is to keep the cost down, which can happen when existing equipment and technologies are used to deliver the menu innovation.
Is it possible to buy something that's too technologically advanced for a foodservice operation?
Without a doubt, sometimes technology is too advanced for the user. It is important to consider the user capabilities in the evaluation process. Sophisticated technological innovation is neat, but at the end of the day, the true metric has to be the aspects of the new technological innovation that will actually be applied. In this process the user has to be brought into the picture and made the center of the operation. Ergonomics, both physical and cognitive, have to be considered to make sure that the operator gets the full value that the technology provides. Sometimes "less is more" when creating a new design or solution for an issue the food service operation is facing.
Obviously price is a critical factor, but what other ones should play into a purchasing decision?
Although price is important, it becomes much less critical than driving a positive ROI. I often find myself in meetings with executives that ask for technological applications that address issues their concept has. In these instances, the executives comment that capital is usually not an issue if the solution can drive measurable ROI.
In simplistic terms, there are two primary ways to drive ROI: increase sales and reduce costs. Since new technological innovations often carry with them higher upfront costs, they have to drive impact in one of these two areas along the way.
One area that's becoming easier to quantify in the ROI analysis of new technology is labor, which is a good thing when you consider the rate at which this expense has grown in the past decade. In the ROI evaluation process, it is important to consider that although reducing the work content of any labor activity is valuable and measurable, that may not be enough to reach the desired outcome. To truly lower labor costs it is necessary to reduce the actual number of physical bodies required to operate the restaurant. Often, technology vendors present the work content reduction as labor savings without true consideration to being able to reduce the number of deployed staff.
As you can see, foodservice technology is a vast and fascinating subject, with a multitude of ramifications. For additional information about foodservice technology and the way it impacts operations, I invite you to check out my blog "Foodservice by Design" on www.fesmag.com.