“I fundamentally want to be at the cold front of decision making. To be front and centre in driving innovation and transformation puts the fire in my belly. My ability to invest change in an organization is why I took this role with open arms. Because we have private equity backing us, our ability to drive fast pace decision and to just get on with it is a breath of fresh air. My responsibility is to devise strategic solutions, roadmaps, and partnerships capable of building and executing technology transformation that can measurably impact the business. Our industry is complex and competitive — you are only really as good as your last month.”
Insightive.tv: What was the situation that you inherited when you landed in your new role?
Michael: Historically, this business has had a variety of point of sale platforms and a myriad of different back office applications. Since starting 18 months ago, the priority has been the rationalization of our restaurant technology stack to reduce cost, complexity and allow for the aggregation of data. There was already a well thought out strategic roadmap, but it has been down to my amazing team to deliver.
Our ERP system is built around our inventory management systems. This is really the backbone of our procurement and restaurant systems. We are now working on the rationalization of data from an inventory and menu management perspective. During my tenure, we have invested heavily in bringing this system into alignment.
Insightive.tv: How high of a priority has e-commerce become to your digitization goals?
Michael: The typical bricks and mortar restaurant experience is undergoing a significant transformation. The emergence and demand for home delivery are growing exponentially with aggregators such as Menulog, UberEATS and Deliveroo changing the way both consumers and retailers prioritize home delivery and takeaway. I like to look at the aggregators as ‘virtual food courts’ — if your band isn’t present you’re not even a consideration. We will continue to invest significantly into this channel via our own eCommerce and digital engagement platforms, in addition to continued partnerships with several leading aggregators.
Owning the customer journey opens a number of opportunities to better understand your customers and cater to their needs from both a delivery and in-restaurant perspective. We now have over 500,000 loyalty subscribers across two of our three brands. Via CRM tools, we engage those customers in a very personal way and are developing what we call ‘read my mind technologies.’ The goal here is to remind a consumer who hadn’t yet thought about what they were going to do for dinner that our restaurant is on their way home or we can deliver. It is about crafting messages of immediate relevance — predictive analytics for dinner. The technology is there from an e-commerce point of view. We simply need to continue to drive engagement and interact with our customers ina seamless, no invasive manner.
We have an e-commerce road map that will continue to drive market share, engagement, analytics and most importantly allow us to truly own the customer experience. Our next phase is to leverage our platforms and overlay that across our other brands. The entire aggregate space of online ordering is worth $6 billion AUD. Our business is years ahead of the competition in the e-commerce and delivery space, we have seen enormous rewards and have built a channel in a very short period of time which now makes up over 10% of total Red Rooster revenue.
Insightive.tv: What have you learned through overseeing this transformation and what has been the biggest challenge?
Michael: The biggest challenge under any franchising model, hands down is business stakeholder and franchisee partner engagement and alignment. We worked heavily on stabilization of platforms when I arrived — making sure that our technology just worked. The results we have been able to achieve have helped garner enthusiasm and trust for continued transformation. Every three to four months, we have stakeholder meetings to engage and align with franchisee partners and councils. I think a key to that engagement is really looking at it as a peer-to-peer relationship. Being a house of brands, acknowledging that what makes us a differentiator in the market is that we have a standardized platform that allows us to deliver quickly and efficiently.
The power and importance of targeted digital engagement have become undeniably clear. We know we can execute a below the line digital marketing campaign that will deliver the same if not greater revenue cut through than the traditional expense of expensive above the line media campaigns.
The algorithms that sit behind our labour and inventory sales forecasting formula cascades up into measured business outcomes. When looking at forecasting of sales or resources we can take a comparative look between recent days, how that day performed in previous weeks, and how today performed compared to last year. We can then consider things like weather — if it rains, we can expect an increase in drive-through versus foot traffic. All of this can be taken into account to prepare for a given day and assess the health of the business — both regarding a single store on a single day and on a macro scale. This helps us manage products, inventory, and labour. The whole system is now connected, and that is only enabled by the standardization of our platforms.
Insightive.tv: What do you see for the future of Craveable Brands and do you have advice for others in your position?
Michael: It is a passion of mine to look at technology through the lens of our customers, staff and franchisee partners. Walking a day in their shoes and understanding the nuances of what they see is something I take very seriously. We formally have what are called ‘in your shoes days’ — an opportunity for us all to get out of the ivory tower and back to reality. This is something that is important to me perhaps partially because I have been in their shoes over the course of my career. I always remind franchisees that it is my job and their job “collectively” to ensure the Restaurant Managers role is as simple as possible because it is one of the hardest and most important jobs in the business. It’s our job to implement technology that allows our restaurant team to minimise the amount of time they spend in the manager’s office performing all of the restaurant administrative functions We have come a long way in this space, maximizing administrative efficiencies with profitable and targeted outcomes that ensure our restaurant teams can spend more time focusing on what’s important -the customer!
There is an absolute acknowledgment that the implementation of Business Intelligence tools will give us the opportunity to work smarter. Analytics are driving every aspect of our business including new store growth. We are leveraging data to understand where our customers live, what they order and our delivery coverage of an area to maximize the impact of expansion to our existing customer base. If we can’t deliver to you today, we want that in our database so that it’s something we can change in the future. However, the next wave for us is to leverage the platforms we have in place by building in — predictive ordering, click and collect, menu customization and different modes of ordering. Driving sales and franchisee profitability via the utilization of technology is and will remain, the priority.
Michael Schofield is the Chief Information & Digital Officer for Craveable Brands — the parent company of the iconic Australian franchises Red Rooster, Chicken Treat and Oporto. Until moving into his new role at the start of 2016, Michael was IT Director for McDonald’s Australia & New Zealand.
Michael is tasked with driving transformation within three brands that run a total of almost 600 restaurants, employ 12,500 people and serve over 150,000 customers a day. We sat down with Michael to understand how digital technology is changing the restaurant industry. We learned how the evolving role of the CIO is orchestrating the utilization of data to drive profits and improve eating experiences.