McDonald’s has made the decision to terminate its partnership with IBM on the Automated Order Taker (AOT) AI drive-through technology. The fast-food giant will be shutting down the test run of this voice-activated ordering system in more than 100 of its restaurants by July 26. The move comes as McDonald’s aims to explore voice ordering solutions more broadly.
The global AI partnership between McDonald’s and IBM began in 2021, with the goal of simplifying and speeding up operations. However, despite some successes, McDonald’s believes there is an opportunity to further enhance voice ordering solutions. In a memo sent to franchisees, Mason Smoot, McDonald’s Senior Vice President and Chief Restaurant Officer for the U.S., stated that the current partnership with IBM on AOT will be discontinued. Nevertheless, McDonald’s will continue to utilize other products from IBM across its system, emphasizing the continued trust in the partnership.
The decision by McDonald’s reflects a broader trend in the restaurant industry, with various establishments, including Del Taco, Wingstop, and Panera, experimenting with AI technologies to streamline operations. Chipotle and Yum Brands have also been leaders in investing in robotics and AI in recent years.
While McDonald’s is ending its partnership with IBM, the company has not ruled out potential AI drive-through plans in the future. McDonald’s stated that its work with IBM has given them confidence in the future implementation of a voice ordering solution for drive-thrus. The company aims to evaluate long-term, scalable solutions and make an informed decision on a future voice ordering solution by the end of the year.
IBM, on the other hand, expressed its intention to collaborate with McDonald’s on other projects as the AOT test ends. The company also revealed ongoing discussions and pilots with several Quick-Serve Restaurant clients interested in the AOT technology.
McDonald’s has previously sold its McD Labs technology, formerly known as Apprente, to IBM in 2021. Additionally, the company sold Dynamic Yield, a predictive ordering technology, to Mastercard in late 2021. These moves were part of McDonald’s modernization plans for its restaurants.
While the specifics of McDonald’s partnership with Google Cloud remain undisclosed, the company’s collaboration with Google has generated curiosity. McDonald’s announced the partnership at its investor day in December, with Alphabet CEO Sundar Pichai expressing excitement about how Google’s generative AI, cloud, and edge computing tools could enhance the dining experience for McDonald’s employees and customers worldwide.
Analysts have noted that franchisees expressed frustration with the automated order taker’s accuracy and operating costs. The technology’s accuracy reportedly remains in the low-to-mid 80% range, and a wider test of the system has not yet taken place. Speculation has arisen that Google’s significant presence at McDonald’s Worldwide Convention in April could lead to the company replacing IBM as McDonald’s AI vendor.