From kitchen display systems to digital ordering apps, technology is increasingly what keeps restaurants running, no mean feat in an era of unremitting pressure on costs and productivity.
These days, in fact, the benchmark for improved operational efficiency is 60 percent among industry leaders, who are aggressively testing the waters with tech solutions. McDonald’s AI “accuracy scales” weigh bags and ensure order accuracy. AI voice automation is key to Checkers & Rally’s drive-thru infrastructure, with accuracy rates surpassing 95 percent. White Castle’s “Crave and Go” automated kiosks in 1,000 locations make hot sliders available 24/7.
Tech advances pay off. But there are pitfalls
An expanding digital footprint is critical to the success of a restaurant, making technology an operational imperative that touches all aspects of the business. Yet many technological advances and their accompanying benefits are counter-balanced by a risk and/or vulnerability.
Consider:
- Mobile ordering systems (mobile apps, web and kiosks) expand customer access, and account for about 50 percent of total sales by quick serve restaurants. The downside? Third-party app vulnerabilities and data breaches extend beyond the restaurant’s direct control.
- Smart kitchen alerts result in a host of benefits, including improved food safety; QSR brands using intelligent, connected systems have reported a 50 percent increase in food safety task completion. One risk, though, is ignored warnings, which can increase the restaurant’s liability and negligence risk.
- Surveillance systems are important for monitoring everything from a restaurant’s service speed to parking lot safety. Yet too often, the systems are used for investigation, not prevention. Some studies say 50 percent of QSR employees say serious food safety issues or environmental hazards are left unaddressed—a liability for the organization.
- Over 80 percent of quick-service restaurants maintain loyalty programs, as they strengthen diner relationships and are a critical growth driver. But that personal data being stored is a prime target for cyberattacks.
Mitigation strategies that count
It takes a proactive, multi-layered approach to effectively manage the rising number of technology risks restaurant operators face. That requires a holistic perspective of technology’s risks in the context of safety concerns overall.
Three areas of focus are critical to the risk management strategy:
- Vet the vendors. The average restaurant has a fragmented tech stack; it’s common to have three or four vendors for online ordering alone. It’s incumbent on restaurant management to thoroughly vet not just vendors, but their software too. That extends to terms in the contract, especially when it comes down to liability ownership. Contracts must be reviewed to ensure the right to audit vendors and receive breach notifications. Also important is building redundancy so if one system fails others aren’t affected.
- Strong internal protocols matter. Staff should be trained in the use of critical technology systems and just as important, measures to take in the event of a failure. Training can extend to tabletop exercises for scenarios like POS outages during peak service or data breaches. Teams must be able to shift to manual operations to maintain business continuity.
- The essential role of cybersecurity training. Different levels of training, according to the staff position, should be provided. Wait staff and other hourly workers could watch short safety refreshers at clock-in terminals at the start of each shift.
The cyber insurance component
Cyber security is a big issue for the hospitality industry in general: the global average cost to the industry of data breaches jumped to $4.03 million in 2025 from $3.62 million in 2023. That encompasses restaurants, too. The California Pizza Kitchen restaurant chain was hit with a class action lawsuit last year after a massive leak of employee data. McDonald’s data vulnerability was exposed last year through an AI hiring platform, possibly related to weak password use.
It makes the case for the right cyber insurance coverage provided through a broker with the resources necessary to help safeguard the business. Together, they can make the difference between a swift recovery from a breach and lasting financial fallout.
Tech related threats are on the rise, but many in the restaurant business consider cybersecurity a low priority. But following cybersecurity best practices will help organizations get better insurance rates, and broader coverage, too.
Kimberly Gore is the National Practice Leader of global insurance brokerage Hub International’s hospitality specialty practice. She has over 30 years’ experience in the insurance industry with a specialization in hospitality and tourism clients. Kim is responsible for a strategic approach to carrier relationships, specialization and best in class service to benefit each client. Kim is an active member of the insurance community serving as president of IIABHGC and as a board member for IIABSC and was awarded the South Carolina Young Agent of the year in 2010.
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