IT IN RESTAURANTS

IT in Restaurants

Abstract

The purpose of the paper is to explore and compare the current use of information technology-related advances in chain and independent full-service restaurants, the factors that motivate managers of these types of restaurants to decide whether or not to implement such technology, and how these managers perceive the impact of technology on the firm. A case study analysis involving four London Bay Area full-service restaurants was conducted to examine the framework of full-service restaurants to implement new technology. Propositions are developed that purport the information technology adoption and implementation characteristics of full-service restaurant firms while elucidating the distinctiveness between chain and independent firms.

IT in Restaurants

Chapter I: Introduction

Most systems and processes in this information technology (IT) driven era have some form of hi-tech interface in transforming inputs to outputs. The restaurant industry is no different, in that IT has played some role in changing a customer's dining experience over the years—the way in which the meal is prepared, the speed at which it is delivered, the way an order is received, just to name a few. With the advent of new technology and its impact on restaurant operations, one would believe that most firms in the restaurant industry would be IT oriented in the production and delivery of goods and services. Yet researchers have posited that, by and large, the hospitality industry is not technology oriented (Siguaw et al., 2000; Buhalis and Main, 2008; Beaver, 2008).

While IT clearly presents opportunities for restaurant firms, what remains obscure is decisions related to restaurant firms' (independents and chains) adoption and implementation of new technology. It would also be useful in exploring the difference between chain and independent restaurants in their orientation towards adoption and implementation of new technology, which to date has not been explored by researchers. Based on this, the purpose of this study is to examine how managers and/or owners decide to implement IT in full-service restaurants, and to see what, if any, effects IT could have on the operations of these firms. We do so by studying four restaurant firms (see Table 1 and Section 4 for details) using a case study method. It should be noted that while IT adoption and implementation will be studied from the perspective of the four firms, this study attempts to lay the foundation on which future research that entails hypotheses testing could be launched.

Table 1: Characteristics of case study firms

Characteristics

Firm 1

Firm 2

Firm 3

Firm 4

Location

Downtown London

London-Bay Area (East Bay)

London-Bay Area (East Bay)

London-Bay Area

Ownership

Independent restaurant/single owner

Independent restaurant/single owner

Chain restaurant/corporation

Chain restaurant/corporation

No. of units

N/A

N/A

140 (40 states)

46 (2 states)

Segment

Full service

Full service

Full service

Full service

No. of seats

65

145

250

145

Market positioning

Upscale

Upscale

Mid-scale

Mid-scale

Cuisine

Italian/Austrian

Californian

Italian

Italian

Annual sales (approx.)

$800 K

Not available

$400 million chain-wide

$100 million chain-wide

Sales mix

Lunch

70%

25%

50%

40%

Dinner

30%

75%

50%

60%

No. of employees/managers

12/3

24/4

78/5

40/3

Employees' educational qualification

Minimum—high school diploma

Minimum—high school diploma

Minimum—high school diploma, 40% college degree

Minimum—high school diploma

Managers' 0educational qualification

67% college degree (two managers), 33% high school diploma (the owner)

50% college degree (two managers including the owner), 50% high school diploma (two managers)

60% college degree (three managers including the GM), 40% high school diploma (two managers)

33% college degree (one manager, ...