In a joint statement, McDonald’s and IBM announced a partnership to modernise technology at its fast-food businesses’ drive-thru lanes and automate the order-taking process.
IBM will purchase McDonald’s McD Tech Labs and accelerate the development and implementation of its Automated Order Taking (AOT) technology under the terms of the agreement. The deal’s financial specifics were not disclosed.
After acquiring Apprente in 2019, McDonald’s launched McD Tech Labs with the purpose of driving employee and customer-facing innovations.
McDonald’s made the move as part of its “Accelerating the Arches” plan, which aimed to expand technology across digital operations, delivery efforts, and drive-thru automation.
IBM’s competence in artificial intelligence (AI) is expected to accelerate McDonald’s efforts to improve the customer and employee experience.
“McDonald’s development and testing of AOT technology in restaurants has shown substantial benefits to customers and the restaurant crew experience. Moving forward, IBM’s expertise in building customer care solutions with AI and natural language processing will help scale the AOT technology across markets and tackle integrations including additional languages, dialects and menu variations,” according to the statement.
IBM’s acquisition of McD Tech Labs is a compliment to the company’s current AI and customer care solutions development efforts with IBM Watson, which is being used in a variety of industries to improve outcomes.
The McD Tech Labs team will join IBM’s Cloud & Cognitive Software division after the transaction is completed.
AOT will remain a part of McDonald’s technological landscape. McDonald’s and IBM are both dedicated to responsible AI adoption and the incorporation of ethical concepts into applications.
“In my mind, IBM is the ideal partner for McDonald’s, given their expertise in building AI-powered customer care solutions and voice recognition,” McDonald’s CEO Chris Kempczinski said on an earnings call on Wednesday (Oct. 27).
McDonald’s third-quarter revenue exceeded Wall Street expectations, because to a mix of larger order quantities, increased menu prices, and the lifting of COVID-19 restrictions in other countries. McDonald’s also mentioned the success of its new crispy chicken sandwich and celebrity-endorsed meals as reasons for its success.
McDonald’s reported $2.15 billion in net profits and $6.2 billion in total revenue, up 22% and 14%, respectively, from the same time a year ago. Global same-store sales increased by 10.2% compared to the same period last year, while same-store sales in the United States increased by 14.6 percent.