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Lessons from 'A Beautiful Mind'

In his latest installment of 'On the High Road,' ATMIA International Director Mike Lee says that the ATM industry can learn a thing or two from the Oscar-winning film 'A Beautiful Mind,' which tells the story of mathematician John Forbes Nash.

May 5, 2002

Mike Lee is international director of the ATM Industry Association, and is based in London.

Johnny Nash, son of the 1994 Nobel Prize winner John Forbes Nash, stood outside the ATM of Sovereign Bank in Princeton, N.J., in a highly agitated state of mind. He couldn't get money from the machine, nor could he retrieve his card.

Johnny Nash had inherited both his father's brilliant mathematical brain and his paranoid schizophrenia. He was suffering delusions of grandeur, believing himself to be a king, even making for himself a paper crown to wear. That is why he had chosen this particular bank, although he had no account with it. Helpless in front of the ATM, he was on the verge of rage.

Oscar winner Russell Crowe plays John Forbes Nash in the brilliant movie "A Beautiful Mind," which traces the tragic yet ultimately uplifting story of a genius plagued for 30 years by mental illness after having discovered the mathematical proof for the influential variation of game theory. That theory stresses the possibility of attaining equilibrium among a group of competitors each pursuing their best strategic option, making him the father of what we know today as the "win-win" scenario (or "win-win-win" for multiple players).

A rare remission of his schizophrenia and the awarding of the great prize have meant that Nash has enjoyed a fulfilling latter part of his life. But despite a lifetime of struggle, his problems are not yet over. For one of his life's remaining goals, in between working on a mathematical theory of the universe, no less, is to care for his 30-year-old son Johnny, an unemployed and severely ill Ph.D graduate, in the fond hope that, like him, he will one day enjoy a miraculous recovery.

His blood pressure escalating, Johnny Nash took out his cell phone and called his mother, powerfully played by Jennifer Connolly in "A Beautiful Mind," demanding that she come to the ATM to get his card out of the machine. She, at least, had an account with Sovereign Bank. Her famous husband insisted on going with her, fearing an ugly scene was about to erupt. The couple, who are now elderly, could neither retrieve the card nor placate their son. So Johnny, in a fit of frustration, grabbed hold of a stick and started attacking his parents. After an unpleasant and undignified fracas, the police were called and Johnny Nash was taken back to Trenton State Hospital.

This unfortunate incident is clearly no advertisement for the ATM, as it highlights a negative experience of a piece of technology that enjoys the highest level of trust around the world for dependability and accessibility. So why have I started this "On the High Road" with it?

"A beautiful machine"

The reason for beginning this month's column with a true story about Nash and an ATM is that his theory of equilibrium between competitors can inspire us at a time when a positive, cooperative style of thinking is required in our industry to take us to the next level of development.

For the ATM is becoming "a beautiful machine" in terms of popularity, efficiency, simplicity and convenience -- but there are areas in our industry still crying out for improvement, such as in security, ATM advertising, tightening business models and integration of ATM networks to create greater critical mass.

Let us review where the ATM is, where it could still go and conclude by showing how a new style of thinking by industry leaders can help us to get there.

The ATM is on the brink of becoming the champion of convenience channels for consumers. My own favored definition of an ATM is: a self-service consumer delivery channel for cash, content and services. The ATM is a key driver behind the creation of the 24/7 consumer society that is evolving before our eyes.

Readers will recall that in Pulse's consumer survey at the end of last year, polling 2,200 bank account-holders in 16 states, respondents ranked their ATM cards second only to the home telephone as the most valued consumer convenience. U.S. consumers seem to value the convenience factor of ATMs more highly than personal computers, internet access, mobile phones and televisions. This level of trust has been built on the back of the ATM's precision engineering, the excellent track record of transaction processing within ATM networks and the long-established reliability of the telecommunications infrastructures underpinning many networks.

Kent Phillips, business development manager for TNS, which provides a dedicated, private IP-based network facilitating transactions among ATMs and processor hosts, believes the secret of the ATM's success has been uptime reliability and availability. "The standard is 99.9 percent uptime -- the customer has to have the feeling that his money is safe and that his transactions will be processed speedily and delivered smoothly," says Dallas-based Phillips, who has been in the industry since 1983.

The second reason why ATMs are so popular is that convenience, comfort and confidence are part of the ATM users' experience. The ATM possesses what can be called lifestyle resonance: it has become an icon of the consumer society. Today, there is even a Barbie "Bank with Me" ATM which enables children to make deposits, check balances and insert a tiny debit card to withdraw fake cash from the bright pink cash machine.

The ATM banking experience embraces some of the freedom of movement behind telephone and Internet banking while never becoming a remote or entirely private event. The ATM is at just the right position for today's modern consumer. Doug Deitel, executive vice president of Cardtronics, the USA's fourth-largest ATM distributor, states, " ATMs have become as indispensable to consumers as checks and credit cards."

Room to improve

Yet such a position of popularity is not unassailable. Nor is this story of the rise of the ATM one of unqualified success.

ATM crime and fraud threaten to disrupt and undermine hard-earned public trust in the ATM. ATM advertising has so much potential, but it has not yet attracted big advertisers to invest in national advertising campaigns. Many countries have fragmented multiple ATM networks, when single, unified networks such as the UK's LINK Interchange Network and Portugal's SIBS network allow wider public accessibility, streamlined transaction processing and centralized management.

Finally, there is a damaging lack of synergy and mutual understanding between the ISO market and the bank-owned ATM market: a Great Divide, in effect.

All these factors point to a need for improvement. At this point, the "beautiful mind" of John Forbes Nash can help our industry make better use of its "beautiful machine."

Nash defined equilibrium as "a situation in which no player could improve his or her position by choosing an alternative available strategy, without implying that each player's privately held best choice will lead to a collectively optimal result." In other words, it is mathematically possible for all the competitors in a given game to follow their most preferred strategy and still end up with a collective result that is the best one for everyone.

In ATM advertising, major third-party advertisers are looking for thousands of ATMs for  national campaigns. Furthermore, the optimal desired impact for such campaigns would be the combined profile of High Street bank ATMs and retail ATMs with high foot traffic near to point-of-sale. To reach this critical mass, multiple deployers will have to collaborate across the Great Divide and all put their ATM estates into one advertising "kitty" or "pot." The result: the kind of advertising revenues the industry has been dreaming about for too long but never banking.

John Hardy, Chief Executive of the respected LINK Interchange Network in the UK, made a profound point at ATMIA's "Optimising European ATMs" conference in London last September when he stated, "Collaboration is not necessarily in conflict with competition."

His assertion is close to what we have been saying about the Nash Equilibrium, moving beyond the destructive "zero-sum" games which are "win-lose" -- "I only win if you lose." This kind of zero-sum style competition has cost the ATM industry an opportunity to create a considerable new revenue stream. But it is not too late to look for a Nash Equilibrium for ATM advertising, looking for the best result for all, at no one's expense.

Working together

Another important field where win-win-win equilibrium is critical to the future of the industry is the kind of collaboration we are seeing in the UK these days in the national ATM anti-crime and anti-fraud initiatives that are making great strides as a result of collaboration and cooperation between deployers, between industry associations (such as ATMIA, the British Bankers Association and APACS) and between all these players and the Metropolitan Police Services at New Scotland Yard.

Here every player can come out a winner as a central database has evolved for all ATM crime trends nationwide. Deployers, whether a bank or ISO, and all regional police forces, can cooperate on a common strategy in hard-hit areas, armed with proactive intelligence, to thwart organized ATM criminal gangs. The rule of this game is "if you put in, you get out." Any deployer or association which would not contribute ATM crime statistics to the centrally managed database would not have access to it, and so could not be part of the solution.

At ATMIA's successful "ATM Sec 02" conference last month, attended by delegates from 17 countries, the key concept became the security of the whole ATM lifecycle. This is when the whole process of the ATM business lifecycle is envisaged, instead of compartmentalizing each separate process.

Through lifecycle thinking, thinking through a sequence of stages from A to Z, ways of understanding how each phase links into every other phase can be found. For a white paper to be developed on ensuring security in each lifecycle stage (leading, ultimately, to greater Best Practices in ATM security), it is necessary for companies operating at different phases of the lifecycle sequence to get together and understand how each stage links to the one after, and to the one before, their own. The win-win-win result is to make the whole cycle more seamless and therefore more efficient and customer-friendly. This kind of lifecycle thinking is another example of searching for a collaborative equilibrium.

And the possibility of equilibrium between multiple competitors in a game, each choosing their own best option, has been mathematically proven, at great personal cost, by John Forbes Nash, to win him the Nobel Prize for Economics.

The upshot of all this holistic thinking, applied within such varied fields as advertising and security, might just be an industry in continuous improvement, building a champion channel, a beautiful machine.

Included In This Story

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ATM Industry Association (ATMIA)

The ATM Industry Association, founded in 1997, is a global non-profit trade association with over 10,500 members in 65 countries. The membership base covers the full range of this worldwide industry comprising over 2.2 million installed ATMs.

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