Diebold Under Swidarski: 2005 to 2013
January 24, 2013 3:48 PM
Thomas Swidarski was Diebold's top exec from 2005 to January 2013. It wasn't an easy job.
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A Fresh Start
Swidarski took over as CEO in December, 2005 after a decade at the company and two months as its president and chief operating officer. He took over Diebold from Walden W. O'Dell (pictured), who resigned after struggling earnings that prompted a major restructuring.
Shareholders Sue
Just as Swidarski accepted the top job, his company faced a class action from shareholders alleging Diebold inflated its share price by hiding the extent of its problems. (Image: ThinkStock)
SEC Investigates
In 2006, the SEC launched an investigation into Diebold's "bill and hold" method of recognizing revenue. In 2009, Diebold agreed to pay a $25 million fine to avoid formal charges. A year later, when the settlement was finalized, the SEC filed civil charges against current and former Diebold execs. (Image: ThinkStock)
Swidarski's Strategy
Swidarski's early plans for Diebold involved reconsidering its current business lines (such as its election business, which earned it bad press) and determining whether the company should open new factories in the regions where it sells machines. (Image: ThinkStock)
Bad Timing
But 2005 was a bad time to become a CEO. “The undeniable truth is that banks stopped making branches and stopped ordering ATMs when the recession hit, and that was a big part of Diebold’s business ... And there was nothing that Tom Swidarski or anyone else could do about that," says Gil Luria, an analyst with Wedbush Securities. (Image: ThinkStock)
Sales Pick Up
Things were looking up by 2009. Demand for ATMs in Asia spiked , offsetting weak orders for the machines in the U.S. and Europe. The demand ran counter Diebold's own predictions — it expected orders to drop after the 2008 Olympics in Beijing. (Image: Bloomberg News)
Another Surge in Sales
In 2012, the Americans with Disabilities Act prompted another spike in orders , as financial institutions bought new machines to comply with the law. "But after that, the banks were not buying ATMs again," Luria says. (Image: ThinkStock)
Plans Crumble
By the end of 2012, Diebold scrapped plans to build a new headquarters in Ohio. It also reported a 58% drop in profits , which it attributed to business delays in North America and Brazil. Building a new 55-acre headquarters, at a cost of $100 million, was "not the right priority for the business at this time," Swidarski told investors.
Swidarski Steps Down
In January, Diebold's board decided to seek new leadership. It pushed Swidarski out , citing the company's "ongoing performance over the past several years," Diebold spokesman Mike Jacobsen said. It did not name a permanent CEO. (Image: ThinkStock)
