In the beginning: branch products.
I joined Diebold in 1979. Branching was strong, but ATMs were in their infancy. Quite honestly, you had to go out and convince people that they needed ATMs. That was 1980. Cash was king. Still, everyone was predicting a cashless society by 1990.

ATMs catch on.
I was hired in as a marketing manager almost 30 years ago for drive-in banking equipment. But, I was a converted ATM user long before that. It was clear that banks were starting to adopt ATMs. They began to believe that if we got everyone automated, banks wouldn’t have to put money into bricks and mortar.

So the banks started a very aggressive deployment of ATMs at existing branches and offsite. As we moved into the late ‘80s, banks really started to slow down their branching. New construction was expensive. The branch products business dropped at least 50 percent -- maybe by two-thirds -- from the time I joined.

Branch products: stay or go?
By 1991 we had shifted so far into selling ATMs that we could hardly get anyone to sell branch products – didn’t matter whether the branch business was good or bad. All the major security houses – Diebold, Mosler and a company called LeFebure – were struggling. Upper management was seriously questioning whether the branching business was something we really wanted to be in.

Bob Barone brought in Bart Frazzitta and essentially said: ‘Split the security part of the business from the ATM business…drive it as a separate unit to see if we should stay in it.” That was the start of the security group.

Branches get new respect.
Banks are always looking for ways to cut costs. And the ATM is a lower-cost transaction. However, I think we all got blinded a bit by this. While the ATM is a lower-cost channel, people also use them more often. With people going to the ATM more, banks were losing contact with their customers -- and losing marketing opportunities. Also, around 1990, brokerage houses, Internet-based companies and others were getting into the banking business.

But by now, banks were seeing their branches differently -- as a strength.

ATMs and branch products helping each other.
Initially, ATMs put our branch business at risk by making banks wonder whether they really needed branches. At the same time, ATMs helped save our branch and security business because we were the only company that could “do it all” for the customer.

Bank managers valued their long-term relationships with us -- relationships usually built with branch and security solutions. That’s one reason why those same banks trusted our ATM recommendations. In addition, our security expertise proved to be a strength as we went up against then-strong electronics companies like Burroughs and IBM while marketing our self-service offerings.

Present and future.
Banks will continue to listen hardest when you tell them how to retain their customers, grow their customers and save them money. Introduce new banking methods and banking customers will likely use them, not necessarily use them to replace other types of transactions. Did the ATM displace the bank branch? Did online banking replace the ATM?