To Avoid Long Tail

The Long Tail Theory popularized by Chris Anderson saying that a powerful new economic force in the world of Internet allows almost unlimited choices. This is particular true for the new era where you’re a retailer and you offer your items over the Internet. The display of your products on the Internet is practically costless if compared to a brick and mortar retail store that involves high operating costs. At the end, the additions of small quantity sales of long-tail niche products maybe larger than the total small percentage of hottest mass selling items.

The Long Tail Curve

For slow moving products, this is a really good news. Amazon.com can offer endless list of book titles, but Barn and Noble chain stores have to make a wise selection of titles for display in their limited shop space.

The Internet has given us a lot of dreams, and proven some old theories wrong, and created some new ones. Unfortunately the Long Tail Theory sounds great for online retailers, but not for manufacturers.

We are the one who still have to abide by the conventional Pareto Principle’s 80-20 rule. We may tolerate 80% of slow moving items in our product line against the 20% of the hot items i.e. FingerTec TA100 and R2 model, but no manufacturer can afford to produce endless niche products that sell very little.

From product design, to structural design, to molding, to prototype, to sampling, to mass production, to A&P, the investment is snowballing, if the new product is not making a hit, producers have to lick their own wound.

Everyone dreams to become Apple, just one model of iPhone versus a plentiful of Nokia models and still making tones of money. We are no Apple, but what we can do is to limit our new products to a few models every year to avoid long tail, and pray for the newbie to rewrite the Pareto Principle to 70-30, 60-40, 50-50….

And come back from the Chinese New Year, we have finally unveiled the latest three models:

1. FingerTec FaceID 2

Yeah, it should be released last December, but to make you look good in color on the screen and not just you in black and white image, we had to hold it back until R&D department removes the final hurdle. It’s worth the wait. You can compare it with some of the rival’s products and notice the striking difference. The first batch of the Face ID 2 are all booked, we hope the good news would sustain in a longer period.

2. FingerTec Keylock 8800

This is another much awaited product. To lift the standard of conventional and high-tech fingerprint door lock combined, the effort and investment are three times higher than a normal fingerprint reader. We hope the market proves that it’s worth the economy of effort.

3. FingerTec TA300

It showed up in my plan a year ago. But the designs were shot down many times until I’m almost given up. But the tireless R&D team kept on trying to keep it alive, and we finally have a desktop standalone fingerprint reader. TA300 is meant for no-installation and low price easy market.

We would release 3 to 4 additional new products this year. To avoid the long wait and the grumbling resellers, this time I have to keep it confidential until it nears production.

But all in all, the more pressing matter now is, forget the Long Tail, what’s in my mind is to beat the damn Pareto principle’s 80-20 rule!

by Teh Hon Seng, CEO, FingerTec HQ

Is Santa Claus Real?

The secret that had been safely kept for nine years was revealed last week.

Coming home from her school, my daughter, in a serious tone, asked me, “Is Santa Claus real, or Daddy is the Santa?”

“Why you suddenly bring this up?” I replied uneasily.

“My classmate told us that Santa Claus is actually daddy and the whole class agreed with her. I’m the only one who insisted that Santa Claus is real. They laughed at me and told me to ask my father.”

The family had worked hard to keep this secret. For a while I wanted to keep it that way. But if I continued the white lie, she would be a bigger laughing stock in her class later on. Since she would soon discover the truth from someone else, it’s better to come from her dad.

So, I told her the truth.

She laughed out loud at first, but later I saw tears welling up in her eyes. I threw my arms around her. 

What a cruel truth.

She told us that she feels happy and sad at the same time. Some of her long unrequited doubts are cleared now, but the anticipation for Christmas would be diminished.

I convinced her that all children would grow up to discover the truth sooner or later, but Daddy will always get Christmas presents.

“But I have to cut my wish list shorter when I know that Daddy is paying for the presents,” she replied glumly.

Santa Claus is children’s best fairy tale, most parents are willing to keep the secret as long as possible. When the real identity of Santa eventually unveiled, the love between the two generations grows stronger.

“That’s why I didn’t get my elephant (toy) last Christmas which I thought supreme Santa should know what I wanted,” she said with a bitter smile.

“I really went to the zoo and asked the keeper to sell one of the baby elephants to me, but he refused,” I joked.

The whole family broke into laughter, and hers with more tears in the eyes.

This episode happened a month after Christmas. And now Chinese in Malaysia are preparing for Chinese New Year celebration, which’s just around the corner. I would be taking a week holiday to be with my family starting from 13^th February. Despite the two days public holiday in Malaysia, all sales and supports enquiries would be replied within 24-hours. No worry, that’s our promise.

Wishing you A Happy Chinese New Year!

by Teh Hon Seng, CEO, FingerTec HQ

The Perils of Low Price

They invariably invaded the market vehemently, with promotion price that seemed to last forever. Low price was their only “weapon”. They swept the market and left the branded but less competitive products wept at a corner, praying for their lives.

Their success has made them stand tall for quite some times, until the next low-price predator marched in to give them a blow. There’s no loyalty, the market will embrace the predator without hesitation, turning the predecessor another vulnerable prey. Their dying cries of so-called better “quality” and “support” than the new rival has no appeal, because it never was in the consideration list and it was never offered before.

The truth of the matter is, price beats price.

There will always be some cheaper priced products out there. Big companies manufacture low price products by running production 24-hour a day, volume component purchases and low labor costs. Size does matter; that’s the economy of scale.

But small companies can sometimes do things miraculously. They offer almost the same quality products with even lower prices. They're like cockroaches when the mighty falls; they’d survive for another million years. To them, size does not matter; survivor instinct prevails.

Whether size does or does not matter, the logic is, price is easily beaten by price. Since price is their only “weapon”, the strategy of the battle has always come down to price war and instead of bringing them benefits; they gain so little even they won the battle.

I was informed that in some countries where price is being made a more sensitive issue than religion, due to the economic downturn, new competitors can easily pound on the same door using the same strategy, initiating a fiercer price war than ever.

Desmond Wong (left) and me

Desmond Wong, executive director of AMTC, a distributor, flew from Sabah (East Malaysia) to visit FingerTec last week, told me that they have been approached and offered with some products from China frequently, undoubtedly lower price than FingerTec.

“I welcome their price discount, but afraid the same discount would apply to software features, service and product quality and reliability.”

After we chatted a little longer, he finally broke into a big grin. “I can make better profit with FingerTec because the customers could feel the worth. If I sell China products, I have to succumb to market force by lowering my profit margin.”

And now it was my turn to break into a big grin thinking of the reality of the situation. Despite the economy downturn, AMTC's FingerTec sales improved by 60% last year.

FingerTec is not an alliance in the price war; in fact we choose to stay impartial. When two China products engage in a price war, we are always not included; but when the sales being awarded, we are not always excluded.

Why so? Because price is not our only strategy, we have many.

by Teh Hon Seng, CEO, FingerTec HQ

Is This A Farewell?

Ms Regielou Rolloque

FingerTec threw a farewell party for Regielou Rolloque last month, but this farewell seems a little weird to me. Yes, she left, flew back to her home country the Philippines on 2^nd January 2010; but she’s not actually leaving us; she is in fact still working full time for FingerTec.

As usual, she has to write a weekly report to the management, follow-up the sales inquiries, handling her Spanish-speaking clients through MSN, Skype and email.

I remember the first time she arrived in Malaysia two years ago during Christmas Day; she appeared timid and introverted. Was she going to survive for two years?

No problem, the friendly working environment and the helpful colleagues here would melt her heart. I told myself.

In two years, her soft-spoken Spanish tongue has melted the Latin American’s hearts too.

Whether she works from Malaysia or the Philippines, there seems to be no difference to our clients. And to us too. It’s just that, without physical presence, her colleagues need to assist her in some administration works from Malaysia.

This is the power of the Internet. And FingerTec sales and support system centers around it, tightening the screws at all ends, fine-tuning the user-experience for both resellers and end users, adding more value from time to time to the platform.

The result is apparent. The virtual has delivered more tangible results than the brick-and-mortar.

One day when Regielou came to me and told me, she missed her home, and she likes her job. Immediately I knew my answer.

You’re free to go home, and you can keep your job.

But you have to visit us once a year, because the colleagues here miss you, too.

by Teh Hon Seng, CEO, FingerTec HQ

Consistency Paid Off

I have a few weekly columns in some local dailies. And the longest period of column I had ever written lasted three years, published every Monday, totaled 156 articles without a single lapse. Despite my busy work schedule, I still accepted an invitation from a tabloid to contribute critique once a week, and it has been a continuous eight months now.

Inconsistency has always killed any brilliant new plan halfway through. In the contrary, consistency is THE key to a successful implementation of any plans. I'm proud of our FingerTec monthly newsletter, since the first issue was published and disseminated in February 2007; we never missed a single issue over the past 3 years, despite the extra workload and rushing for deadline drew excessive pressure to our staff, when their hands were usually tight, and minds were usually prioritize with some other promises to customers.

Because of our persistence, we maintain consistency and we take care of the content’s quality at the same time. I witness many companies much larger than us, even with a team of dedicated sub-editors, normally had a fine start but slowly lost their momentum and passion as the time went by. We only have our team of sales and technical personnel contribute their writings and assist with the editing of the FingerTec monthly newsletter for the past three long years; and my gratitude to them is beyond words.

One close friend of mine once commented, “Consistency is important, but the virtue can be more valuable if you tie it with some sales strategies rather than a mere newsletter.”

“But newsletter is one of our very effective sales strategies,” I rebutted. The consistency of the newsletter is not just the only one thing we pursue. The fact that we never overlooked other areas such as the handling of sales and supports through our CRM system proves consistency. People shouldn’t be too shortsighted in business. Newsletter is a long-term commitment; an intimate relationship we build with our customers; the results might not be as straightforward but it’s beneficial in the long run.

FingerTec Newsletter, January 2010 issue

In fact, besides the regular updates of our latest developments, Newsletter helps us to win over some potential leads that are selling other biometric products. It also serves as the checkpoints for our staff to contribute technical tips and marketing information to enrich our support websites regularly. Without the monthly newsletter, I can expect very rare updates of our relevant support websites, and the excuses would never be short of supply. Our Newsletter also provides a platform for our resellers worldwide to publish their stories, to announce their successful projects and have the opportunity to share with the others their FingerTec experience at no cost at all.

We improve the contents and design of our newsletter from time to time, and we have been meeting our deadlines earlier in order to publish the volume from the middle to early of the month. Furthermore, the consistency we pursue has slowly turned the process of publishing our newsletter into a habit, and the burden also has been replaced by responsibility. And we expect reading of the newsletter would also become a habit to our resellers.

I dare say that the consistency of our newsletter has improved FingerTec® image tremendously. A distributor from Africa came to the office every half year and she brought with her printed pages of our newsletter and asking for further explanation and updates on various topics. I don’t have a statistic to prove my bold statement, but from feedbacks I received and from my gut feelings, I know that this is true. My logic is simple, I reckon many people believe that, if FingerTec is serious about something they deemed less important, what about those significant matters? Go figure.

by Teh Hon Seng, CEO, FingerTec HQ

New Year, Renewed Excitements

(Note: This is my keynote speech for the Company’s Annual Dinner on 2^nd January, 2010)

2009 is a bittersweet year for many. Just as the outbreak of H1N1 sent shocks to the human race all over the world, the economics turmoil hit, wounding many nations and businesses.

Even though we feel the effects of the merciless disasters, FingerTec had no time to grieve; we continue marching according to the planned activities. New products, R2i, i-Kadex, DigiPay, TA100T are launched this year, and Smart Keylock 8800, FaceID and TCMS Web Version are due to be released just around the corner.

On top of that we have some new products in our pipeline for 2010 too. But all in all, with the growing maturity of all the technologies from the hardware to the software, it sparks a new direction, a new diversification to our present business model.

It is a new business model based on Cloud Computing Technology, along with the debut of TCMS V2 Web version in 2010, and the built-in Web Server technology in our terminals.

I agree that there is no guarantee for success in any new business venture, but the mere idea of it has renewed my excitement. It is worth a try, a very serious try.

Our sales team should renew their excitements too this year with a new mission burdened on their shoulders. The mission is to guide the distributors through and through by using the new FingerTec Distributor Business Guidebook as the “Going In” strategy, besides the much-awaited new products led by face recognition technology and Cloud Computing Technology.

And in 2010, in conjunction with the 10^th Anniversary celebration of FingerTec, I proudly present to you the 10^th Anniversary Celebration logo, which bores a spirited tagline: A Milestone For The Next Leap. It marks our passed glories as a profound milestone, reminding us to be prepared for greater challenges in the next leap. Things without challenge lack excitements, don’t you agree?

In this New Year, with the renewal of our excitements, I also urge you to revisit our company’s motto, Think and Reinventing. Indeed, that’s the very fundamental principle that I want to stay permanent with us without a slightest change. On the contrary, it could be further enhanced.

I quote a few paragraphs from my previous comprehension article for this motto I wrote a few years back as a punch line to refresh your mind.

Think & Reinventing

The more you can think, the more valuable you are. Especially when we are now living in the Information Age. Information Age generates myriad of data everyday, data would turn into garbage if we skip the thinking process. Knowledge would be derived from data if we add thinking substance into it; and wisdom could further be derived from knowledge if more thinking process and analysis are involved.

I like this proverb that goes "Nothing can't be achieved, only when it's beyond your imagination." In fact, any good execution should be the result of good thinking and comprehension.

Thinking will lead to improvement in your daily work; improvement will lead to reinvention of jobs, of products, of services, of administration, of marketing and of everything.

Reinvention spirit should stay in our blood to give us more boosts and push everyday, to continually find out what can be done to improve our life, our work and our environment. Once identified, find a way, make a change, see the result, review the performance, and repeat the process all over again. I value creativity, but I value reinvention more.

Many Small Steps; eventually would lead us to a Big Leap.

I wish you all the best in the coming new year.

by Teh Hon Seng, CEO, FingerTec HQ

FingerTec Distributor Business Guidebook

The whole company just came back from an all expenses paid trip to Shanghai. After a wind down, I am planning to spend most of my time in this last month of 2009 to write FingerTec Distributor Business Guidebook.

Company trip to Shanghai

What is a brand good for if it is just a logo affixed on a product? I always ponder about this, and I would not hesitate to do more for FingerTec. The Guidebook is in fact a round up of practical branding efforts we have done all these years and to extend it in an organized way for an easier adoption by our distributors. The main objectives are to help them increase sales, to improve cash flow and to reduce support costs in a more efficient way, I must say.

The Enlightenment

The idea had dawned on me on the last day I wrapped up my India trip, on the way to Mumbai Chhatrapati Shivaji International Airport. I saw our effortless methods in strengthening Malaysia’s market and our global strategies in penetrating the international market can be combined and fine-tuned to further benefit our worldwide distributors, besides using our plentiful readily available branding materials.

The Buddha sat under the Bodhi Tree for 49 days to find his Enlightenment, but he spent the rest of his life teaching the theory of Karma, which spawn from the Enlightenment. I foresaw we would face a similar challenge. It is not merely the writing of the Guidebook, but if there is a gap between a distributor’s daily operation and the Guidebook, how should we convince the distributors to change their business conducts that they had accustomed to, even if they agreed to do it the FingerTec way.

Buddha and the Enlightenment

Patching up the flaws

I always detect flaws in some of our partners’ FingerTec business operations that deter their growths. When I was invited to give a talk, I would share my view (of course, a broad one without too much details) with them on how to tap on FingerTec resources for better business expansion, but it’s normally ended up in futile because old operation habits diehard. This time, a detailed Guidebook with follow-up monitoring system may yield a more constructive result.

Our first 5-year plan started in 2001 was more focused on technological research and development, which laid a strong groundwork for FingerTec products to soar. The second 5-year plan with a global marketing strategy was to spread our wings to as many countries as possible in the world. For this, I summed it up as a “Going Out” strategy, having our products currently presence in over 100 countries.

From Going-Out to Going-In

From Going-Out to Going-In

I had made up my mind long ago that the next 5-year plan should be a continuation of “Going Out”, which naturally succeeded by “Going In” strategy. But this strategy is bothering me every now and then, because it seems to me that we need to have a string of different sub-action plans in order to deal with different local partners, or to set up operation offices abroad to ensure the success of the plan. And I also realized that if we followed this costly conventional path, we will eventually loss in a maze of disorientation in our future plan.

For 2010, also the 10^th Anniversary of FingerTec, this is the next 5-year milestone I set for FingerTec, to unite the Diaspora FingerTec partners around the world and to unleash FingerTec branding power through emphasizing the uniformity of strategy that extended from practical branding to business operation.

by Teh Hon Seng, CEO, FingerTec HQ