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Restaurant veteran Cliff Hudson says the chances of adding robots to the industry are 'excellent'

Cliff Hudson, Former CEO of Sonic Drive-In and author of "Master of None," joins Yahoo Finance’s The First Trade with Alexis Christoforous and Brian Sozzi to discuss the overall restaurant industry, how the COVID-19 era has impacted future innovation, his new book and much more.

Video Transcript

ALEXIS CHRISTOFOROUS: As the country returns to eating out at our favorite fast food restaurants, one industry veteran is offering some insight on what exactly it takes to make changes at restaurants. Here to discuss is Cliff Hudson, former Sonic Drive-In CEO. He's also out with a new book, "Master of None," where he highlights those key leadership tactics.

Cliff, good to have you on the show this morning. Before we get to the book-- and there's a lot to get to there-- I'd love your take on what's happening right now in the restaurant industry, given the pandemic. I mean, you took Sonic from being this smaller, Southern brand to being a national chain. How do you see the way we eat at restaurants, particularly fast food restaurants, changing in the wake of this pandemic?

CLIFF HUDSON: Well, I think change is the order of the day. And it's a challenging time. The phrase that comes to mind from my viewpoint is that fortune favors the prepared. And in this case, it's a very-- it was a difficult thing to prepare for.

Sonic was ready, because one, I think naturally it stood ready because of the service delivery model, meaning it's a drive-in restaurant where carhops bring you the food. And in a pandemic, that's played very well for Sonic.

In addition to that, just before it was acquired a couple of years ago, we had finished the rollout of our mobile app-- so mobile order, mobile pay. And that's a rapidly growing piece of Sonic's business. So from that standpoint, taking that and broadening that lesson.

The question for folks in the industry is, what is your service delivery model in this pandemic time, and is it something that works for consumers? And if it does work, and if you're meeting their needs where their needs are, then you're more likely to see your sales stabilize, if not grow.

Many restaurants don't fit that characterization, and they've seen restaurant sales decline. And they're in a very challenging time.

BRIAN SOZZI: Cliff, I've already started to see renderings of the restaurants of the future by the biggest fast food chains. Do you think the fast food chains of the future just won't have a lot of employees in them, that it will be mostly robots flipping burgers and serving food as we all try to get beyond this pandemic?

CLIFF HUDSON: Well, the incidence of mechanization and application of robots is something that's going to grow in the economy generally. The chances that that will occur in the restaurant industry are excellent, just like it's going to occur across other industries.

I suppose the variation, I think, that could play out-- I do go back to my experience at Sonic. All the food's made to order, and there's an opportunity to customize literally customer by customer. So in that in that circumstance, the same robot application could occur. But the customization is going to make it a little bit more personalized and probably will require a little bit of individual effort.

Now, beyond that, I think that these issues of separating location from service, meaning various mechanisms for delivery-- they grow through dark kitchens, et cetera-- is going to mean a big shift in the industry. And the way customers expect to be able to order food and receive their food will continue to shift. And this will play more into what you're describing, I think.

BRIAN SOZZI: Cliff, we talked a good many times when you were the CEO of Sonic. And I never realized this about you, and I did now reading the book. You're a bit of a history buff for a long time.

Where do you think we are in this country when you hear the president come out and say he is not willing to commit to a peaceful transfer of power? As a history buff, what does that mean for the country?

CLIFF HUDSON: Well, your last person, your guest on your program just before me here made the comment that he hoped that was mostly bluster. I think we'd all have to hope the same thing. We do have 200-plus years of peaceful transfer from one president to the next, whether the same party or not.

And so you know, your prior guest also made the point, it'll be good if we have a clear outcome so that the question about transition shouldn't be a question. But we have come to expect, that with great historical roots to that expectation. And I think the American people are going to be expecting it here as well.

ALEXIS CHRISTOFOROUS: Cliff, I want to get to the book, titled "Master of None." I really liked it. And it piqued my curiosity, because we're always told it's not good to be a jack of all trades. You should pick something, focus on it, master it. Why is it OK to be mediocre at a number of things and not master just one thing?

CLIFF HUDSON: Well, one of the things that's pointed out in the book, and right to your point, is that the term "jack of all trades" was one applied to a person some time ago, a very well-known person named William Shakespeare. And the interesting thing is here, a few hundred years later, we all remember the term jack of all trades. We all remember William Shakespeare. We don't remember the fellow's name who made that accusation.

And I think that's kind of a telling point, that the fellow who thought it was a bad trait and who accused William Shakespeare of being a jack of all trades is the one we don't remember. And that's Robert Green. So in fact, from my standpoint-- it's made very clear in the book-- being engaged in a variety of activities, whether in your personal life or even in your professional life, not only makes life much more interesting, but I think it makes you a more effective whatever you are. A more effective leader, a more effective executive, a more effective member of society-- certainly, a more interesting one.

So my life has been quite varied from that standpoint, as I talk about in the book, as Brian asked a moment ago, about the enjoyment of history, the enjoyment of music, with a heavy engagement in the transition of our business, the passion for the business, and the compassion for the people. The combination of these things, I think, make me a better executive and a more interesting person, I hope.