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AIPROPX ReportFortune · 2h ago
How KFC and Taco Bell’s top technologist is embracing AI and automation across 63,000 restaurants
When Jim Dausch joined restaurant operator Yum Brands in late 2024, one of his first orders of business was to find a way to ensure Pizza Hut’s food was delivered as hot as possible.
Previously, the software that connected the chain’s kitchen and fleet systems processed orders in a rudimentary “first in, first out” flow. An order would come into the restaurant and a ticket would immediately be generated to tell the kitchen to put the pizza in the oven. But there were plenty of times where the the order would sit idle waiting for an available driver.
Dausch and his team created a data-forward automation layer that changed the workflow, telling cooks not to make the pizza until the system knew with greater certainty that further down the chain, a driver would be available for pickup. The change led to hotter food deliveries and a “meaningful” increase in customer satisfaction scores, according to Dausch.
“We are sort of step-by-step going through what it takes to run our restaurant and finding every way we possibly can to automate those things,” says Dausch.
Dausch joined Yum Brands, which recently saw sales take a hit from a cyclospora outbreak, in December 2024 as global chief digital and technology officer of Pizza Hut. He was promoted 11 months later to hold that same title across the entire enterprise, which includes the Taco Bell and KFC brands. He oversees Yum’s websites and apps, digital order platforms, corporate systems, AI and data, and restaurant technology across 63,000 global locations that are operated by around 1,500 franchisees.
Yum is Dausch’s first foray into the restaurant sector, but he says that his thinking around technology closely mirrors his 20 years of experience at hospitality giant Marriott . All of his technology investments focus on customers, workers, and the franchisees. For the franchisees, food and labor have traditionally been their largest expenses, but increasingly, they’ve had to increase their investments in technology. Still, Dausch says they have little appetite to just accept every new tool without a clear return on investment.
“When we talk to our franchisees, they’re very worried about that,” says Dausch. “If we can’t prove that what we’re putting in place is either going to meaningfully improve the customer experience in a way that drives higher same-store sales growth, or meaningfully reduce food waste in a way that is going to ultimately pay for itself, obviously the franchisee is going to kind of resist.”
With ROI in mind, there are times when Dausch has to say no. Robotics have generated buzz among franchisees, but no single prominent use case has emerged that Yum deems worthy of chasing. He’s also cautious when buying the AI capabilities pitched by software-as-a-service vendors, saying higher chip costs and other infrastructure expenses have made pricing for these features too frothy.
Some bigger technology bets Dausch has placed include digital kiosks, which have been rolled out to around two-thirds of restaurant locations globally and consistently produce higher check averages than in-person orders. An automated, voice AI ordering system has been rolled out to more than 900 Taco Bell U.S. restaurants, also with the intention of boosting order sizes, while also improving accuracy and increasing customer satisfaction.
Dausch acknowledges that the voice AI system has been a “learning journey,” requiring Yum to make tweaks to the system so that the handoff between the AI and human workers is smoother.
Across the quick-service restaurant industry, kiosks have been one of the biggest tech hits with diners, but even there, Dausch sees an opportunity for improvement. He’s added a step where consumers can enter their loyalty program information so that kiosks can make more personalized offers based on the data the restaurant has from past orders.
At Yum, which ranks #474 on the Fortune 500, Dausch also oversees Byte, a proprietary SaaS restaurant technology platform that was designed to consolidate online and mobile app ordering, point of sale, kitchen and delivery, menu management, inventory, and labor management tools and systems. For now, Byte is completely an internal platform, though the intent is that it will have an external customer in Pizza Hut, which Yum agreed to sell for $2.7 billion in June.
Dausch credits former CEO David Gibbs, who retired earlier this year , for setting the vision that Yum would need to prioritize technology and AI to compete aggressively in the restaurant sector. A typical restaurant location was managing up to 30 software vendors, and it could take a day or longer to pull insights from some of those systems. Byte operates as a single platform with just one data source.
“The challenge was that the restaurants often did not have a common line of sight across all of those systems to how their business was doing in real time,” says Dausch.
One example of how Byte has helped improve restaurant operations has been in inventory ordering. Yum’s automation system has led to an 85% reduction in “stockouts,” which is when a restaurant would run out of ingredients, resulting in lost sales when menu items aren’t available.
Yum has authorized enterprise licenses for OpenAI’s ChatGPT for district managers and franchise leaders, who are also mandated to take courses through an “AI Academy” that teaches them how to understand prompting, create digital executive assistants, and encourage the development of more than 400 AI agents.
All that said, Dausch knows he’s only one piece of the pie. “I don’t know anyone that has ever just selected a restaurant to go to based on the technology,” says Dausch, who adds that craveable food at a fair price is what wins diners. “It’s important for us that we don’t lose the plot.”
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