24/7 Insights
- McDonald’s Corp. (NYSE: MCD) wants to cut labor costs to improve profits and its share price.
- Yet it has scrapped plans for AI-based drive-thrus at 100 locations.
It seemed like a good idea, and perhaps a way to cut labor costs at McDonald’s Corp. (NYSE: MCD) outlets. This was to team up with International Business Machines Corp. (NYSE: IBM) for an AI-based drive-thru. McDonald’s canceled the plan as something went wrong.
CNBC obtained a document stating that the plan was scrapped at about 100 locations. The effort was known as the Automatic Order Taker. The concept was as simple as the name. Customers spoke into a microphone. When they reached the delivery window, their food was ready, and presumably faster than if a human had done the work.
McDonald’s spoke as if the service was perfectly fine. Mason Smoot, senior vice president and chief restaurant officer for McDonald’s U.S., said, “While there have been successes to date, we feel there is an opportunity to explore voice ordering solutions more broadly.” However, voice recognition could not recognize all voices, depending on the accent of the order taker. Since the partnership with IBM is three years old, the companies have more than enough time to see what is wrong.
Why AI?
McDonald’s needs some magic beyond the Golden Arches. Its stock is down 15% this year, while the S&P 500 is 15% higher. Labor costs could be the key to an improvement, if only AI worked.
The Price of a Big Mac in Each State
∴
Want to Retire Early? Start Here (Sponsor)
Want retirement to come a few years earlier than you’d planned? Or are you ready to retire now, but want an extra set of eyes on your finances?
Now you can speak with up to 3 financial experts in your area for FREE. By simply clicking here you can begin to match with financial professionals who can help you build your plan to retire early. And the best part? The first conversation with them is free.
Click here to match with up to 3 financial pros who would be excited to help you make financial decisions.
Have questions about retirement or personal finance? Email us at [email protected]!
By emailing your questions to 24/7 Wall St., you agree to have them published anonymously on a673b.bigscoots-temp.com.
By submitting your story, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
