How to replace the restaurant director with a robot?

    Few people thought about how pizza is prepared in a restaurant, and even using new technologies. But one company uses a lot of interesting things: there are metrics, and tracking customer activity, and automatic distribution of tasks. Personally, I will order pizza for myself and will enjoy watching this interview with the creator of the Russian pizzeria chain Fedor Ovchinnikov. Join now!



    Digital Transformation Series


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    3. We teach the machine to understand human genes .
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    A series of interviews with Dmitry Zavalishin on the DZ Online channel :

    1. Alexander Lozhechkin from Microsoft: Do you need developers in the future?
    2. Alexey Kostarev from Vera Robot: How to replace HR-a with a robot?
    3. Fedor Ovchinnikov from Dodo Pizza: How to replace the restaurant director with a robot?
    4. Andrei Golub from ELSE Corp Srl: How do I stop spending a ton of time shopping?

    Who is the interview with?


    Dmitry Zavalishin is a Russian programmer, author of the OS Phantom concept, organizer and member of the program committee of the OS Day conference, founder of the DZ Systems group of companies. In 1990-2000, he took an active part in the creation of the Russian Internet segments (Relcom) and Fidonet, in particular, ensured the transparent interaction of these networks. In 2000-2004, he was responsible for the design, development and development of the Yandex company portal, created the Yandex.Guru service (hereinafter - Yandex.Market). Read more on the Wiki .

    Fedor Ovchinnikov- Founder and CEO of Dodo Pizza, an international pizza chain developed through a franchisee network. Business success is based on the automation of each operation and quality control through technology. That is how the pizzeria from Syktyvkar for 6 years has become known throughout the CIS and abroad.

    Interview


    Dodo Pizza is the most amazing company I have ever seen and heard. It amazes me not even that it is successful, not even that it went beyond the borders of the Russian Federation, but that you seem to have done exactly what you intended. So you planned to make exactly such a company, you made it, and it turned out to be successful! Is it true?

    Yes, you can say that it is. But we have not reached far what we are striving for, just the beginning of the path. Even our management company has not yet reached profit. The network is growing and quite successfully in Russia and in many other markets.



    You did not profit in the sense that you did not repulse the investment?

    No, we invest purposefully. That is, there was a period last year when we were in profit. Our management company, which develops a franchise, is an information system that is the main value of a franchise. And then we just turned on the cost switch: we moved the office to Moscow and purposefully went into a manageable loss.

    We have not yet begun to bring dividends or profit to investors. Therefore, we can say that our mission has just begun.

    Our series of interviews is dedicated to digital transformation, and the most interesting part for me is how IT changed the traditional business, and changed it so much that no return is possible. Do I understand correctly that the IT component is the key in the company and it is impossible to compete with you without comparable automation?

    Of course. Our big idea is to change the market of mass catering (network), using the capabilities of information technology and the Internet. Of course, we have just begun to create these advantages and what awaits us in the future, when the network will consist of hundreds, of thousands of pizzerias. The advantages that we are now laying in creating our platform will be very serious. It will be very difficult to compete with us.

    But today, is it still possible?

    Of course you can.

    We ourselves believed in this idea, we made investors believe in this idea. And all the main advantages, of course, are still to come.

    Creating your platform in conditions of very limited resources is quite difficult. Say, we are currently undergoing restructuring of our information system, because the business has grown very quickly, and we need to change the architecture of the systems, because it does not withstand such loads, because it was created for two or three pizzerias, in fact. Therefore, we still need to go this long way.

    Dodo Pizza became successful because you are good IT people, because you built a good IT component? Or are you just great businessmen?

    I think that we are good businessmen who convinced investors that our history is long-term. We invested in creating our own platform, which in the future will provide competitive advantages that will allow us to develop in the world.

    Our product is a mass market - it is pizza. Pizza is popular in any country in the world: in the USA, Brazil, China, Vietnam. People know what pizza is. Therefore, making a cool product, we can further scale the business. And then our IT component will play a major role!

    In general, what gives IT in our business? Actually, our product is more than pizza, it is a kind of consumer experience that people in a pizzeria get: it is the stability of quality, service, delivery services, this is such a whole infrastructure. And our idea is that by creating an IT platform to control all this infrastructure, starting from detailed processes in the kitchen, by the speed of preparation of each product (by the speed of slicing tomatoes, by the reaction of the client), we will be able to manage this business better than our competitors .

    In fact, we have two differences from our competitors: the first is that we do everything through the Internet. We can very easily connect various devices with Internet access, it is easy to change this system, develop it, because it can be updated every minute. And the second is the combination of competencies, as we call it. That is, that it is an ideal system for a particular business. Imagine, now we generally control everything that happens in the network business, starting from how happy employees are, for example, in Kazakhstan. We can correlate this data online with staff turnover.

    Can you or correlate?

    Correlated, of course. But much of what we have done is just lying. For example, we can forecast sales, but we still do not, unfortunately. What are we already doing? We compare the detailed metrics of all pizzerias and they get feedback all the time. Each of them connects to a platform that allows you to comprehensively see the entire business and manage it.

    In fact, you are now saying that with the help of the right IT infrastructure, you have provided a very detailed monitoring of your current business. And due to this monitoring, are you able to quickly control quality and optimize it?

    All right. And to increase production efficiency, that is, to get more profit. Basically, again, what is the essence of McDonald's business? They created a model that is then replicated by entrepreneurs through franchising.

    I just wanted to ask: How inspired were you with McDonald's replicability?

    Any company in mass catering develops in franchising. McDonald's in this regard is not the best example, they have more than 80% of the restaurants owned by the franchisee. There are companies in which 100% of the restaurants are owned by franchisees, for example, Subway. They do not have a single restaurant that belongs to the owner of the company.



    Frankly, they have so-so quality.

    But at the same time, the model works. What is McDonald's business? They created a model, handed it to the entrepreneur who runs it. And then they control that this model works as intended. And they do this with the help of traditional management: control, checks, standards.

    What are we doing? We impose certain sensors on all processes, connect customers, couriers and see all this online. In fact, I think that any retail business that has some standard services will go our way.

    In preparation for the interview, I talked with colleagues in the company, and we had some debate: we roughly assumed that, in fact, you built a very good ERP, which really controls the processes in detail. And then my colleagues suggested that this system can be easily transferred to another business. But it seems to me that the depth of understanding of a particular enterprise is great enough, and the system that you made, of course, is tied to this business.

    Of course. And this is the most common question: why don't you start selling this system to the side? But here, in general, there is a different paradigm: our product is not a system, our product is a franchise, the core of which is this web service. In fact, we are a product company, we are not an SAP that creates a flexible solution.

    You are not a software company, you are, after all, a pizzeria.

    Of course, we are a product company that, using the Internet and IT, is trying to improve the consumer experience. And the effectiveness of business control is also improved.

    How different is your business process from typical? You probably know the typical processes in the industry.

    I think that, in general, it is practically no different, but in the details ... As the saying goes, "the devil is in the details." We have a lot of things that are just more convenient, better optimized.

    Let me give you an example: we have all the numbers transparent to all network participants. In fact, you just need to make some figure transparent and show it to people, and immediately it starts to improve. At us, for example, all pizzerias see their own and other performance at any given time and can compare them. As soon as you see that labor productivity is somewhere twice as high, you begin to immediately improve your business. That is, pizzerias are competing.

    Have you realized the most notorious capitalist competition?

    Of course, it works everywhere. There are a huge number of metrics. We are all trying to measure, even quality: we have a rating based on secret checks and buyers. And we do not see a single mystery shopper, we were practically not at our pizzerias (oddly enough).

    How many pizzerias do you have now?

    227.

    In how many countries?

    In nine countries. Most points in Russia and Kazakhstan. That is, in Kazakhstan we also have a fairly good position.

    As for the visionary. Here is the concept of “smart home”. We make a “smart pizzeria”, where everything is interconnected: the system sees that there are too many people in the shift, the productivity is low. She automatically begins to create an offer, this is dynamic pricing, offer discounts and send them to people who have subscribed to, say, receiving offers at a low price.

    Do you load production when you have a load failure?

    Yes, and this is done automatically. Neither the franchisee nor the manager needs to control this. Thus, we pay back at least labor during these hours and the average productivity per day for these hours is growing.

    Or, say, the system sees that there are no orders now, but there are staff. And she begins to throw some tasks that, for example, need to be done once a month (wash the ventilation, for example). Business consists of such trifles: wash the ventilation, do this, and there can be a lot of such things. When all this is combined into one system, all this is controlled, then the average level of efficiency and quality on the network grows, and we get a very powerful competitive advantage.

    And speaking of marketing. There is a figure that you get only 5% of customers from an online channel.

    I can’t say for sure that these figures are different by region. But in fact, we are not strong enough in digital marketing right now. We have never done this before this year.

    We deliberately, since we were limited in resources, did not invest in digital, because we did not want to spray. But we learned to work very well offline. But now we are going there, since some of our competitors are, by the way, aggregators, classic Internet companies. Their core competency is attracting customers online.

    Was it cheaper to go offline?

    We are now cheaper offline.

    Is this today, when is 2017, when everyone is screaming that online is much more profitable and effective?

    In fact, an interesting situation happened: online now there is such a bloody ocean where any company with any budgets can come and reach the consumer very easily. There are very transparent managed tools, everything is measured, anyone can do it, a huge number of players. And while there is offline where it is very difficult to control everything. If you even want to hand out flyers on the street, it is very difficult to control: you think that your promoters are distributing them, but in fact no one is distributing them.

    They put it in the bin, that's all.

    Of course. And therefore, when we go offline, there is no competition. And if you provide quality management, then we get a very high conversion. And now, clients attracted offline are much cheaper for us than online.

    Tell us about working in foreign markets: why, for example, everyone wants to go to China, but not everyone succeeded.

    I will not say what we did - in 5-10 years it will be possible to say. Companies enter different markets in different ways. American companies tend to come from above: they come and eat the market. That is, we have a model that works in the USA, and we will promote it. By a model, I mean not even a business model, but the external part (pizza, design, some service details, and so on). That is, all of the details are made up. They come and say: “We will teach you. This is ours, we will not change anything. ”

    We act differently. We come from below, we come to the Chinese market and act like the Chinese. We copy what works in China, take our model, take the menu that works in China. We open, start to work and watch. This point is the beta version of the product. We begin to look at what works, what does not work, what repeated orders, what reviews, what happens, what doesn’t work, and we begin to slowly improve. Then our task is to create some model that works, open the second point, and test. And further on we are talking about this model, it works, it is profitable, and we are already looking for entrepreneurs who will replicate this model.

    That is, you still open up not with franchising, but yourself?

    We opened in China with franchisees, but we immediately told them: you will work as if we are one company.

    They were not ready, they did not know how, or you did not want to take risks?

    This does not work. This is a great success so that the franchisee himself is able to develop a product, model.

    Nevertheless, when we talk about your optimization cycle, it rests precisely on this very franchisee. That is, it is a certain director of a particular point that looks at metrics and makes management decisions to improve the quality of work?

    But the system really tells him, plus we can set triggers that simply will not allow him to work poorly somewhere.

    And what is the tracking model for this? So you launched some point, showed employees a few arrows and said: look, if this arrow falls here, then go and scold such an employee, or help him do this, improve this situation. Then they do it for a while, and then you find out that the arrow still falls. Who is figuring out? How does it find out? What are you doing in this? The whole next control loop top of it?

    Our model is very logical, it is very easy to diagnose where the problems are. We give all the metrics so that the online partner can see and compare everything with others. And then - the salvation of drowning - the work of the drowning themselves.

    So you do not climb?

    We will not solve his problems for a partner. The partner is an entrepreneur, and he gets a working model. He himself is motivated to make a profit, but we do not allow him to work poorly for customers. If he does not make a profit, this is his problem. But if it starts to give poor quality, then here we can close the pizzeria.



    Here you have such a single tool of influence: close the pizzeria? Should there be any tools up to this point?

    Of course, the diagnosis. A huge toolbox with experience, how to solve problems, training. That is, our task, of our product, of our system is to maintain a state where all partners work as efficiently as possible and their revenue is growing. Therefore, of course, we are constantly working to ensure that partners increase their effectiveness. But we do not do it for them!

    I know that you have some kind of new corporation system whereby shareholders can invest not in the whole company, but in a specific pizzeria?

    Yes, this is actually our big idea. It has already been implemented. As I said, we have opened more than 200 pizzerias and almost no partners have attracted bank financing.

    Lending?

    Yes. A huge number of cases where private investors have invested in our partners. The idea is this: we have a platform, we provide transparency, we say that this model works, it can be replicated. Our task is to combine enthusiasm in the form of a hungry entrepreneur and capital on this platform. Figuratively, we say this: we create a car, an entrepreneur is a racer, and an investor is a gas station that gives him a sip.

    We have an idea such that, even in the same China. If we manage to create a working model machine, and we will enable these hungry small entrepreneurs (and in China a huge number of entrepreneurs) to open pizzerias and give the opportunity to finance private investors, then we can achieve explosive growth. Because on the one hand, investors get a working model, it is about the same everywhere. It is liquid because it can be sold within the network. It is transparent, because DoDo IS - our system - gives investors complete transparency (they see what is happening in our system).

    Here is a very important point about liquidity. You claim that now the scale is already such that a specific point can be sold within the network.

    Of course, what is liquidity in general? When you opened a restaurant, its success depends on fashion, on the chef (the chef quit, the restaurant was unsuccessful). We are a mass market. The pizza delivery model works always and everywhere, if this model is suitable for this market.

    Yes, if you make m3 nuts, then, in general, it doesn’t matter in which corner to make them by and large.

    Of course. Here the success of the Pyaterochka store depends on the same execution. But the model itself obviously works.

    We have a big goal - to build a global company originally from Russia. And we feel that this is truly possible with IT benefits. We understand that we can distract, enter busy markets. In the USA, we now have two pizzerias. One is working, one is being built. These are the most beautiful markets for development: USA, China.

    Somewhere you say that if the pizza did not arrive in an hour, then it is free, somewhere in 45 minutes. But in America this is not at all?

    This is just that detail, that tuning, which in each country can be different. The market is so segmented that all the niches are occupied. And Domino's Pizza has long occupied a niche in America where the main advantage is delivery speed. To bring pizza to America quickly is a must have. This can not be sold. Something more is needed.

    Starting this series of interviews, I dreamed of talking about a business that has always been very traditional and down to earth, and now it has suddenly become very IT. And you set a great example! Thanks a lot!

    Meetup Under the Roof of Dodo Pizza


    On February 1, the second QA Meetup will be held under the roof of the Dodo office. You will be able to listen and discuss three reports on how to minimize the risk of release failure from the point of view of the analyst and developer. You can also find out how the qa-team turned into a platform for acquaintance of new developers with the principles and rules adopted by the company.

    Register here !

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