IBM has entered a strategic partnership with McDonald's in order to develop artificial intelligence technology that will help the fast-food chain automate its drive-thru lanes.
IBM and McDonald's Partner Up
The deal was announced on Oct. 27, and the companies revealed that IBM would acquire McD Tech Labs, formerly known as Apprente before the fast-food chain repurchased it in 2019. McDonald's refused to discuss the financial terms of the transaction.
On an earnings call on Oct. 27, McDonald's CEO Chris Kempczinski said that they believe IBM is the best partner for the company due to their decades of experience in creating customer care solutions that are powered by artificial intelligence.
The McD Tech Labs uses AI to understand customers' drive-thru orders. Earlier this year, McDonald's tested the technology at a couple of their branches in Chicago. Kempczinski stated that the test showed substantial benefits to both the customers and the employees.
In June, Kempczinski also shared with the public the company's strategy for tech acquisitions. He said that if they make acquisitions, it will be for a short period of time, according to CNBC.
McDonald's CFO Kevin Ozan said that less than 100 employees would leave the company to work for IBM. He said that the move is not a massive financial statement impact.
Shares of the fast-food chain were up more than 2% on Oct. 27 after the company released its third-quarter results. Their earnings and revenue topped estimates as its international markets bounced back, according to Engadget.
Despite the impressive technology, the public voiced their concerns regarding the potential replacement of humans, resulting in people losing their jobs in the future.
Yorkshire Post reported that Nick Fletcher, the Tory MP for Don Valley, warned the government that they must prepare to mitigate the negative effects of AI instead of just focusing on its benefits.
Fletcher said that while some of the technologies may seem far off, they have taken over a lot of unskilled, low-paid jobs. He cited that McDonald's coffee was ordered in person, and now, with the development of drive-thru areas, customers have to place their orders on a giant screen.
Fletcher encouraged the government to protect the people's jobs as massive companies are moving towards artificial intelligence to deliver better services.
Fletcher added that AI technology is usually introduced to aid the pre-existing workforce. However, just like McDonald's, managers eventually realize that their workforce can be replaced and that AI technology is what is left doing what humans were doing, but doing it better.
The Tory MP also added that the rise of AI technology is likely to decimate people's jobs. He even cited that the AI revolution will be different from the industrial revolution decades ago. This time, it will affect employment on a much larger scale.
McDonald's has not released a statement regarding the security of employment in their company. The company just stated that they are working to make things easier for both the workers and the customers.
Aside from its voice recording systems, McDonald's is also being pressed by the issue regarding its ice cream machine, and the fast-food chain is working on solving the issue as part of its push towards better technology.
McDonald's is also working on releasing new food items on the menu, including McPlant Burgers.
This article is owned by Tech Times
Written by Sophie Webster