In this exclusive interview, asmag.com speaks to Swift Wu, General Manager of the International Department at ZKTeco, about how the company has effectively addressed industry challenges in 2023. Additionally, Wu provides key perspectives on how the company’s transformation from a private entity to a publicly-listed company has influenced its corporate strategy and product roadmap.
Founded in 2007, ZKTeco has long established itself as a leading global provider of hybrid biometric identification technology. In August 2022, the company marked a momentous occasion when ZKTeco successfully became a publicly-listed company on the Shenzhen Stock Exchange. The original intention and idea for which (according to ZKTeco’s 2022 annual report) was “to achieve sustainable development and become a respected innovative global enterprise in the field of ‘multimodal biometrics and multimodal computer vision’”.
In this exclusive interview, asmag.com speaks to Swift Wu, General Manager of the International Department at ZKTeco, about how the company has effectively addressed industry challenges in 2023. Additionally, Wu provides key perspectives on how the company’s transformation from a private entity to a publicly-listed company has influenced its corporate strategy and product roadmap.
asmag.com: What was 2023 like for ZKTeco? What were challenges and how was ZKTeco able to respond?
Wu: Looking back at 2023, it was a pivotal year for ZKTeco and for the industry as a whole. The world was showing signs of economic recovery. However, global economic performance did not meet expectations. While there were improvements, some sectors like retail lagged behind others in recovery. Some regions continued to grapple with lingering economic deficits, resulting in postponed or cancelled government projects. In more extreme cases, rapid currency depreciation led to economic instability.
Despite these challenges, certain economies outperformed others, with significant changes seen in lifestyles and business operations. The shift towards remote work and online shopping had a considerable impact on our business, particularly in areas like time attendance systems and other B2B security solutions. While many companies have begun asking their employees to return to the office, we anticipate that some changes in working practices may be permanent.
Compounding these difficulties were escalating geopolitical tensions, with some nations in conflict or facing economic sanctions.
These global issues led to an influx of vendors branching out into overseas markets to compensate for domestic economic downturns. Many employed a skimming strategy, offering low prices to penetrate new markets. This approach not only disrupted local markets but also threatened the sustainability of local suppliers due to the extremely low profit margins.
ZKTeco, with its longstanding presence in international business, was well-equipped to navigate these challenges. Our trusted partners and established distribution channels, coupled with our pioneering work in biometrics technology, provided us with a competitive edge. As an end-to-end solution provider, we had the flexibility to tailor our offerings to customer needs, from firmware and hardware to software and mobile applications. This adaptability helped us win projects and foster long-term partnerships.
Recognizing the growing public concern around cybersecurity and privacy, we made considerable efforts to meet these requirements. Our solutions align with universal industry standards, reinforcing our commitment to providing secure and reliable services.
In summary, 2023 was a year of overcoming challenges and adapting to new market realities. As we move forward, we remain dedicated to innovation, customer satisfaction, and creating a safer world with our biometric technology.
Asmag.com: The transition of ZKTeco from a private to publicly listed company marked a significant milestone for the company. Can you elaborate on how this has impacted ZKTeco’s company and investment strategy?
Wu: The transition to becoming a publicly listed company has been a journey of immense dedication and effort, one that every member of the ZKTeco team is proud of. This significant milestone has brought about numerous changes and opportunities for our organization.
In the aftermath of this transition, we have seen the clear benefits of increased capital at our disposal. This has enabled us to make long-term investments, particularly in our top priority - research and development (R&D). We operate multiple R&D centers, focusing on hardware development in Dongguan, software development in Xiamen, Android development in Dalian and cloud platform development in India. With our eye on the future, we are expanding our business to include advanced security solutions and cloud-based intelligent advertising solutions.
Becoming a public company has opened up new avenues for our growth at ZKTeco. This transition has not only enhanced our financial resources but also expanded our strategic options. Specifically, it has facilitated our ability to participate in mergers and acquisitions, allowing us to form synergistic relationships that can aid in market expansion and technology advancement.
Another significant change is the expansion of our sales network. With increased visibility and credibility, we have been able to forge new partnerships and alliances, reaching a wider audience and driving growth. We've also been able to tap into a larger pool of external network resources, including suppliers, partners, and potential customers. These relationships enable us to stay ahead of industry trends and continue delivering cutting-edge solutions to our customers.
The increased transparency that comes with being a public company has instilled greater confidence in our solutions among the public. Our adherence to strict regulations and transparency requirements provides assurance to our customers about the quality and reliability of our offerings.
Finally, this transition has allowed us to reward our dedicated team members through an attractive stock reward program, helping to attract and retain top talent.
However, with these benefits come new challenges. High expectations from our investors drive us to strive for excellence every day. Despite the challenges, we remain committed to innovating and delivering outstanding results for our shareholders and customers alike.
In summary, becoming a publicly-listed company has provided ZKTeco with a wealth of opportunities, from expanding our reach, enhancing our offerings, to building stronger relationships with our customers. We are excited about the future and remain committed to delivering even greater value to our customers and shareholders.
Asmag.com: Can you share some noteworthy accomplishments from the past year?
Wu: In the past year, we at ZKTeco have made strides in expanding our business along both horizontal and vertical dimensions. We consider horizontal expansion as into new business sectors or lines, and vertical expansion as penetrating higher or lower market sectors.
In 2023, we focused on establishing a solid foundation for future growth. One of our notable achievements was the investment and development of our next-generation access control systems. These systems, built on universal industrial standards, are fortified with intelligent and flexible functions. To accomplish this, we incorporated multiple advanced technologies, including artificial intelligence (AI), cloud computing, and big data. This integration solidifies our position at the forefront of the industry and offers our clients the most sophisticated solutions.
Simultaneously, we've made significant progress in our vertical expansion. We are on the verge of launching a new product line that provides real-time managed advertisements, professional digital displays, digital signage, and digital posters. This system is fully enhanced by computer vision technology, addressing the limitations of conventional advertisement placement tools that cannot push correlated advertisements to audiences on demand.
In our system, front-end cameras utilize computer vision technology to provide active video analytics. This includes text recognition, pattern recognition, and behavior analysis. Our edge devices then push correlated advertisements to the audience based on these analytics. This technology greatly enhances the accuracy of advertisement placement and provides reliable statistical information to advertisers.
Our achievements in 2023 have set the stage for future growth and development. We are particularly proud of our progress in integrating advanced technologies into our solutions. As we move forward, we will continue to harness these technologies to provide our customers with cutting-edge solutions that meet the constantly evolving needs of digital security.
Asmag.com: How is ZKTeco strategizing for 2024? Where do you see new business opportunities in the market?
Wu: While the world continues to face conflicts and unstable situations, we remain optimistic for 2024. We anticipate a return to economic stability, particularly in regions like Southeast Asia and the Middle East. These regions are becoming hubs for manufacturing and IT jobs, and we foresee considerable economic growth there.
Our strategy for expansion has always centered around localization. We adhere to a management philosophy of decentralization — we believe that providing our branches and departments with autonomy allows them to deliver optimal results, spurred by an effective motivational system.
In response to the tense political situations among global superpowers, we've invested resources to ensure dual supply chains. This strategy will enable ZKTeco to maintain production and delivery of our solutions to partners and clients, regardless of external circumstances. We established a factory in Thailand in 2019 to produce products for the overseas market. Another new factory in Thailand is under construction to enable us to continue expanding this production base and diversify our manufacturing capabilities.
In terms of technological advancement, we've heavily invested in R&D, specifically in AI technology, to enhance our biometric technology performance. As of 2023, our biometric technology is among the top in the industry according to the NIST competition results. We firmly believe that biometrics is the future of human identity authentication and are committed to providing top-notch biometric technology across various solutions and applications.
Alongside biometric technology, we believe that cloud-based and SaaS platforms are becoming mainstream. Soon, ZKTeco will launch several SaaS platforms for access control, visitor management, and time-attendance services. This is just the beginning of our journey to provide cloud-based services, with more to come in the next few years.
Indeed, 2023 marked an exciting time for advancements in AI technology, with ChatGPT (GPT-4), in particular, garnering global attention. As a technology-based company, we at ZKTeco have embraced these advancements, incorporating AI to enhance our solutions in numerous ways.
The integration of GPT-4 into our systems is one such initiative. GPT-4, with its impressive language understanding and generation capabilities, offers potential benefits for our solutions, such as improved user interaction, more intuitive system controls, and enhanced data analysis. We are optimistic that the integration of GPT-4 with our existing solutions will result in improved user experiences and more efficient system operations.
However, it's crucial to remember that ChatGPT is just one facet of AI. AI technology as a whole offers a broad range of opportunities to enhance our solutions, and we've been keen to leverage these opportunities. For instance, we use AI in our biometric algorithms, where machine learning techniques allow our systems to improve accuracy and performance over time. AI can also improve system integration, allowing different systems to work together more intelligently and efficiently. Furthermore, AI enables advanced function linkages, where various system functions can interact in complex ways to deliver more sophisticated capabilities.
In essence, while ChatGPT is an exciting development in AI, it's part of a broader trend of AI technology playing an increasingly important role in access control and security solutions. At ZKTeco, we remain committed to staying at the forefront of these advancements, constantly exploring ways to leverage AI to provide our customers with the most advanced, secure, and efficient solutions.
In conclusion, for 2024, we are poised to capitalize on economic growth in key regions, leverage AI technology, expand our cloud-based services, and continue investing in R&D. Our strategy is to stay resilient, adaptable, and committed to delivering the best solutions to our customers.
Click here to learn about the market reports and the top 50 rankings:
