Article

Diebold talks automation

U.S. FIs move toward more financial self-service.

June 17, 2007 by Tracy Kitten — Editor, AMC

Diebold Inc. is moving into the future with a focused approach - one that includes international and domestic sights. That's the message Tom Swidarski delivered at this year's gathering of The Advisory Group - better known as TAG - an organization of financial institutions that use Diebold's self-service equipment. (Read also,FI ATM group sets attendance record with 29th event.)

 

Since taking the Diebold helm in December 2005,after the step-down of Diebold's former chief executive Walden O'Dell, Swidarski has placed an emphasis on service. And Swidarski has incorporated service into his company's overall plan for growth, he said to TAG's conference-goers.

 

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"We want to be world-class in service," he told ATM Marketplace during an interview at the show. "And in the U.S., service will be more important going forward, as we're doing more overall service for the institutions we work with."

 

Tom Swidarski

It's not surprising that Diebold is emphasizing its servicing capabilities. Competitors in the space, including NCR Corp. and Germany-based Wincor Nixdorf International, also tout their ability to service and consult. But with a dominant market share in the United States, Diebold is focusing a great deal of its attention on customer retention, rather than customer acquisition. (Read also,Banking future at Wincor World.)

 

Diebold has 4,000 technicians in the United States, making the company's service business by far it's largest, Swidarski said.

 

His plan includes a vision to increase Diebold's financial self-service deals this year in the Americas by expanding service deals from 64 percent of financial self-service-division revenue to 75 percent of division revenue.

 

Multivendor software also is a focal point. In fact, Swidarski lists software as one of the company's key priorities - accompanying self-service, integrated services and international growth - for 2007 and beyond.

 

"Over the last 18 months, software has been a focus," he said, "and we want to spend a lot of time training our employees."

 

Photograph by Tracy Kitten TAG attendees enjoy a smorgasbord of Texas fare at Knibbe Ranch, just outside San Antonio.

 

Company growth

 

Swidarski said most of Diebold's growth over the next three to five years will occur in non-U.S. markets, with Eastern Europe holding the highest growth-percentage potential at between 20 percent and 30 percent. In the States and Western Europe, growth will continue but will maintain at single-digit levels.

 

"I want to be global, but I want you to think of me as local," Swidarski told TAG's attendees. "In the security business, we're looking at acquisitions from a global perspective. Most of our security business is in North America right now, so we're interested in building that up outside the U.S." (Read also,Diebold takes award for event-monitoring solution.)

 

The United States, however, is still important: "We have between 8,000 and 9,000 people in the U.S. It is the bread and butter for us, even though we do want to grow internationally."

 

Photograph by Tracy Kitten One of Knibbe Ranch's owners, Sharon Knibbe, explains the ranch's agricultural operation.

Worldwide, Diebold has about 15,000 employees.

 

About 95 percent of Diebold's annual revenue comes from the United States, Brazil, China, Mexico, Russia, Canada and India. Russia alone is expected to contribute $100 million toward the company's revenue this year.

 

"Eastern Europe is big on self-service, especially where currency exchange and bulk-note deposits are concerned," Swidarski said.

 

Automation and adaptation

 

As more functions within the branch are automated, Swidarski sees more opportunity for service and consultation. Software also will play an ever-more dominant role.

 

Deposit automation, the crux of branch automation and transformation, as well as Diebold's RemoteTeller and PassVault applications will be focal points for the company in the future, Swidarski said.

 

Rhonda Dickinson, TAG's president and assistant technology manager for Fresno, Calif.-based Educational Employees Credit Union, says Diebold is on the right track, since a move toward more automation is inevitable. EECU jumped on the envelope-free bandwagon early. Now the credit union is working to roll out automated deposits at every ATM within its network. 

 

In December 2006, Diebold commissioned Harris Interactive to survey some 2,000 consumers about the types of features and transactions they would like their FIs to offer at ATMs. Based on that research, in addition to deposit automation, personalization, advanced functions (such as bill payment and check ordering), security and channel integration are expected to be key ATM initiatives for U.S. FIs of all sizes over the next 12 to 18 months.

 

To meet those needs, Diebold is banking on its Opteva ATM line and Agilis software. To date, Diebold has sold more than 100,000 Opteva ATMs in 98 countries. And Agilis EmPower, which the companyintroduced at the end of Mayin Milan, Italy, is a new software platform designed to build cross-channel integration, enhancing personalization and targeted-marketing efforts at the ATM.

 

What's new?

 

In addition to Agilis EmPower, Diebold is using 2007 as a year to introduce a few things, including an entry-level ATM, the CashSpot, and the Opteva 328, a recycling ATM, which is expected to hit the market by mid-year.

 

The CashSpot caught attention at TAG, where it was introduced, because of its bend toward low-transaction volume - between 350 and 500 transactions per month. The CashSpot is its own product line, with its own messaging standard and embedded processor, said Diebold's Tim Hoover.

 

Designed for retail locations, the CashSpot is expected to hit the streets during the third quarter of the year.

 

The CashSpot replaces the CashSource Plus, which Diebold pulled from production more than two years ago.

 

But where the CashSource Plus was built on OS/2, the CashSpot is a Windows machine that runs on CE, giving it more customizable options, Hoover said. It also can use a variety of emulations, including CSP 200, Triton and Tranax.

 

The new ATM retails for between $6,000 and $7,000 and can hold up to 4,000 notes - 2,000 per cassette.

 

"We want to make it clear that this is separate from Opteva and Agilis," Hoover said. "It is its own product, designed to meet a specific customer demand."

 

Visit TAG'sWeb sitefor information about the 2008 conference, set for June 22-25 in Tucson, Ariz.

 

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