Interview with Jana Moak, President and CEO Control Module Inc

Feature Company

Interview with Jana Moak, President and CEO Control Module

April 2006

Congratulations on your recent Women of Innovation Award from the Connecticut Technology Council. Can you tell us a little bit about this award?

Thank you, Peter. It is quite an honour to have been selected as The Connecticut Technology Council's "Women of Innovation" award winner in the small business category. Each year, The Connecticut Technology Council honours women who have been involved in various levels of innovation in a variety of sectors, including large business, youth, R&D and small business. I believe that this award is a reflection of Control Module's reputation and leadership as innovators over our entire history and most recently, in the area of biometrics.

Control Module was the first to market with a portable time and attendance terminal, barcode technology, secure media technology and fingerprint biometrics, which we introduced approximately seven years ago. We have worked closely with our suppliers to harden the technology and now, as with all great innovations, many of our competitors have added biometrics to their product lines.

At the same time, CMI believes we lead by having the best products in this space. Due to our seven-year commitment to biometrics and having the best engineering team in the industry, we have been able to embed biometrics into our entire product line seamlessly, with some of the best identification accuracy rates and fastest enrolment times available. Further, we have been able to work with the technology to lower the price point in order to make it possible for businesses of all sizes to embrace the power of biometrics to meet a comprehensive set of workforce management and data collection needs.

CMI also leads the industry with our Genus line of open architecture JAVA programmable terminals. We were the first to market with a JAVA terminal, and have been able to improve the technology to enable our partners and customers to leverage the power of Java today, making our terminals easy to program and customize; while enabling seamless integration into a variety of backend payroll, ERP and time & attendance databases. Our Genus terminals have received significant praise from our partners for their enormous accuracy, ease of use and reliability; as well as their ability to enable easy development of customized applications to meet their customers' unique needs.

CMI's leadership bringing customers innovative products that meet their needs is inherent in our history and is integral to our culture. We were extremely gratified to receive the Women of Innovation award as an acknowledgement of our leadership in the workforce management and data collection categories. Our vision, combined with Control Module's exceptional engineering team, will continue to produce products that deliver enormous value, at an affordable price.

Well it is great for a company to be recognised like that, but I know that Control Module has a long history of Biometrics in workforce management. What led Control Module to look at Biometrics in the first place?

That is a great question, Peter. About seven years ago, our product marketing team was looking at the kinds of solutions that would add value to our product line. We wanted to jump ahead of our competition and create a differentiator that was in-line with our aggressive culture and commitment to delivering the most powerful terminals to meet customer needs. We researched the field and partnered with a leading Biometrics company that was just beginning to bring Biometric Fingerprint Readers to the market.

In its infancy, there were two impediments to mainstream biometric adoption: reliability and user acceptance. Our team worked closely with our providers to harden their products and bring them into our product line as a way of identifying individuals in the workplace. The technology has evolved and improved significantly: today's biometric technology permits up to 4,000 templates for employee identification with a very high read rate (low false reject).

Acceptance of fingerprint biometrics was also an issue at first, because of privacy concerns and inaccurate reader rates. As enterprises and users have become educated to the fact that templates cannot be converted into fingerprints used by law enforcement and other government agencies, the privacy concern has dissipated. Further, the industry now has better sensors and algorithms that provide excellent and fast first-read rates, so that it is not frustrating for someone clocking into work. Biometric identification is quick, accurate and employees no longer need to carry cards -- they just put their finger on the reader and go.

As you know, there are significant advantages to the use of biometrics for workforce management and data collection. First, the ability to accurately identify employees to streamline payroll and eliminate discrepancies helps our terminals pay for themselves. Time and attendance data integrates easily into payroll databases, creating the ability to accurately automate the calculation of complex compensation structures.

Biometric readers also help businesses eliminate buddy punching -- this is something a lot of people talk about now. You can't just give someone your card and say, "clock me in -- I am going to go fishing." This savings alone is said to be on the order of 3 -- 5 % of payroll. Further, with concerns that exist today regarding disgruntled former employees and terrorism, biometrics offers the most accurate means of employee identification possible for secure access control.

Fortunately biometrics is receiving significant acceptance in the workplace today. The technology is extremely accurate and reliable. And the required education of employers, employees and labor unions to the fact that fingerprint templates cannot be converted to actual fingerprints has paid dividends for the industry.

That is a very interesting point because I know that several years back it was an issue but it seems to be disappearing now -- are you finding that?

This concern is disappearing, and part of that also has to do with the general commercial availability of biometric products. You can get a biometric mouse for your computer today. You can also get biometric devices to open your car or house. Furthermore, post 9-11, people have become more acceptant of higher security operations.

Jana, are you finding that this is becoming a more important part -- that blending of physical access security with workforce management?

Absolutely. We like to use the phrase "from door to desktop". Employees can use their fingerprints to gain access to their building and clock-in. Then they can go to their desk and gain logical access to the computer system. Once in the building, access is also controlled to other areas - server rooms, file rooms, etc, - providing access to only authorized personnel. We feel that there is as much interest in biometrics for secure access control, as there is for time and attendance. Enterprises of all types want to be able to secure locations and make sure that only the right people have access to their facilities, and restrict areas with high-value inventory and equipment to authorized personnel.

What are the latest innovations in your biometric product line-up?

It is probably worth noting that all of CMI's terminals enable customers to leverage the power of biometrics. CMI's Genus line of terminals is JAVA programmable, offering customers the greatest ability to customize applications to meet their unique needs. Our Genus I terminal, which was introduced a couple of years ago and has a similar footprint to our legacy product, but is built around an open architecture, provides enterprises of all sizes with a powerful, customizable workforce management and data collection terminal. About a year ago, CMI introduced its Genus II terminal, which also provides a biometric reader, soft keys, a large display screen and a significant amount of memory. We also recently announced the Genus PC, which is a data collection terminal built around a PC, providing enormous memory and processing speeds.

All of these devices use fingerprint biometrics and our supplier has an extremely high read rate, very fast response time, and can handle 1:4000 template identification.

Many of your products are sold internationally as well. Where do you see the greatest growth geographically?

We are seeing a tremendous amount of growth in Latin America. Last year we secured a large agreement with a re-seller in Brazil, which is selling in 15 countries and 115 channels. This was an enormous boost for us. They are particularly interested in the biometric area and the security side of it. Our primary targets in Latin America are companies offering financial services. The banks, financial institutions and security companies down there are very interested in our product line. We entered that market last summer by attending one of the largest trade shows in Brazil and were really able to observe the enormous level of interest there. Our big growth area is Latin America, but we also have participation in the Middle East and Europe, as well.

What vertical markets are you focussing on right now?

Well, as you know, historically, Control Module's vertical markets have been retail, manufacturing and transportation. Transportation is a big place where biometrics is significant because of its security benefits. Many major airlines are also Control Module customers -- and have implemented biometrics. The cruise lines are also using Control Module biometric units. We continue to penetrate the existing verticals and we are working on extending it to the hospitality, entertainment and government sectors because we have a good profile there, as well. We will be entering some additional verticals, as we roll out some industrial solutions in the near future.

Was 2005 a good year for your company?

Thank you for asking. 2005 was a great year for CMI. We entered several new markets and rolled out our latest Genus product line. It was also my objective to grow the business by looking at new channels, in addition to growing our existing base.

We expanded into Latin America as I discussed earlier.

We extended our reach into the government business through partnerships with firms that have been already doing business with this important market. And to this end, Control Module is pleased to have added a listing on the GSA contract schedule;

We entered the mass markets with our low-cost terminals through an agreement with a very large distributor out of Texas, which is taking it to large, national retail chains, as well as some of the major catalogue stores. We are very excited about getting to places that we couldn't get to before, and that has added a lot to our growth.

Well thank you very much for taking the time to speak with us!

It was my pleasure, Peter.

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