Artificial intelligence

McDonald's has announced that it will begin testing artificial intelligence technology for customer service on McDrive at 10 restaurants in Chicago. Using a voice assistant instead of staff will allow McDonald's to reduce costs.

McDonald's CEO Chris Kempczinski said Wednesday at Alliance Bernstein's Strategic Decisions conference that a voice assistant with artificial intelligence (AI) technology will take orders from McDrive customers at its 10 restaurants.

This represents the company's next step in automating service in its restaurants, after McDonald's restaurants around the world began to feature electronic signage to take customer orders.

Taking orders at McDrive by voice assistant became possible after McDonald's acquired Apprente in September 2019. Apprente specialises in developing voice-activated AI technology for fast-food businesses.

Kempczinski said restaurants using this voice ordering technology have an order accuracy rate of around 85%.

McDonald's aims to reduce staff costs and improve staff service. The success of this technology will depend on how well the artificial intelligence recognises the speech of people with different accents, given the multinational nature of the company's customers.

Kempczinski said it would probably take more than a year or two to fully implement the technology. It will probably take that period to test and improve the technology.

In an interview with CNBC, Kempczinski said McDonald's also plans to improve kitchen automation, but that would require a big investment, so those improvements could be implemented in the next five years. Chris said: "We're nowhere near what break-even has to be in terms of labour costs to make it a good business decision for franchisees".

The latest quarter reported by McDonald's is Q4, ending in December 2020.

At the same time, McDonald's digital sales through the app in the US were up 5.5%.

McDonald's management predicts that global sales in 2021 will "grow and surpass 2019's figures".

McDonald's shares are up 8.95% since the start of 2021 and 24.6% in the last 12 months, up 13.6% in the last quarter.