Cypress Technology, a professional
audio-visual equipment design and development company, is known as the “AV
Processor Maestro” in the industry and it’s about to enter into its 30th year
of operation. Benefiting from the recent trends in remote conferencing and remote
teaching, corporations and schools have purchased increasing amounts of video
conferencing equipment. Cypress Technology’s revenue this year aims to maintain
last year's high levels.
Cypress Technology was established
in 1991 and will reach their 30th anniversary next year. Its product portfolio
includes digital audio/video processors, distributors, switches, and extender
products. Their main customers are the world's top five audio/video equipment
brands. The production base is 100% within Taiwan. As a result of the US-China
trade war, they have benefited from the transfer order effect and won many additional
orders.
Consumers have encountered Cypress
Technology’s products, such as multi-screen LCD video walls, in a wide range of
locations such as department stores, banks, airports, train stations, theaters,
schools, hospitals, offices, government agencies, and even sports bars. Thanks
to their AV board technology, which is integrated directly into the LCD
displays themselves, groups of four, nine, or sixteen LCD TVs can be combined
into a single video wall presenting real-time 1920×1080 high-resolution video.
This technology lets a single computer remotely control the configuration and allows
for a variety of screen splitting modes.
At its founding, Cypress Technology had around ten employees, and in the intervening time it has grown to its current level of 360 employees. However, the process has not been completely smooth. Chairman Norton Tsai, Director Champion Yang, and others were colleagues of Proton Electronic Industrial Co. Ltd. in their early years. In 1985, they established a joint venture to focus on high-end consumers with products such as a high-quality TV that could handle surround sound audio with a manufacturing cost of more than NT$50,000.
Developing
Niche Products
To build a consumer electronic
product brand, it is best to have a strong product line, strong capital
reserves, and well funded channel marketing. Ether Electronics (Cypress Technology’s
founders’ previous company) once asked for Hugua, a well-known host and famous
actor in Taiwan, to shoot TV commercials for them. They spent tens of millions of NT$ in
broadcasting TV commercials and selling their own TV sets, but the price of their
products was significantly higher than even Japanese branded televisions. Additionally,
financial opacity and inefficient capital turnover resulted in financial
problems for Ether Electronics. They burned money, continuing to increase their
capital from NT$7 million to NT$40, and then NT$50 million. Not long after,
they were acquired by a securities company.
However, Yang and Tsai were not
discouraged. In 1991, after their four year baptism within Ether Electronics,
they, along with another friend, started Cypress Technology with NT$6 million
in equity. After learning the lessons of their prior experience, they settled
on three major tenets to adhere to during the early establishment stages. The
first was to avoid consumer electronics products and instead target a small
number of diverse, high-tech, niche products. The second was to never cut
employee’s salaries, and the third was that financial reports must be clear and
transparent.
In the early days of its
establishment, Cypress Technology focused on video system conversion products,
and successfully won orders from Europe, Africa, China, and other locales.
After launching a new version of their digital video system converter in their
second year, it quickly became an instant success. Increasing their operating basis,
and accumulating research and development capabilities year by year, Cypress
Technology grew around their core competency of modifying and integrating a multitude
of disparate ICs with unique software and hardware technologies.
Cypress Technology made money during
the first year of its establishment, and never took money from shareholders,
never needed a cash capital increase, instead adopting the method of
reinvesting their surplus to increase the company’s capital. This year, Cypress
Technology has been listed on the Taipei Exchange’s OTC for ten years, an
important milestone. Chairman Tsai recalled that over the past ten years, the
annual turnover has grown steadily by 15%, showing a stepped growth. Revenue
has reached more than NT$2 billion, which has doubled every five years.
Jones Hsu, President of Cypress
Technology, describes Cypress Technology as a professional audio-video
equipment company with a Taiwanese core and a global outlook. Their product
design, R&D trial production, and final production all are based in Taiwan.
Among the nearly 360 employees, nearly 32% are engineers. This staff
composition shows that their key strength is in the research and development of
technology. Over the past 30 years, Cypress Technology has primarily focused on
the ODM market. Recently, however, it has begun to cultivate its relationships
with large customers and more distributors, and has begun to focus on customers
across Eastern Asia and other places. With the addition of these new channels,
Cypress Technology can leverage their accumulated technical strength to great
advantage when it comes to directly facing their end users and designing
products based on a vertical market’s needs.
The
New Team Takes Shape
In response to newly developing application
trends such as smart cities, the Internet of Things, and medical imaging,
Cypress Technology has recently developed high-speed AV transmission and video up-conversion
multi-function products, introduced new AV technologies, and communicated with
business customers to gain a deep understanding of brand customer needs and strengthen
the application side of product development.
In the last few years, a new team has
been coalescing at Cypress Technology. Norton Tsai, Jones Hsu, Steven Su
(Vice-President of R&D), Erik Su (Vice-President of Sales & Marketing)
joined together to construct a blueprint for sustainable business development
to welcome the new era of 5G and advanced video technology that is coming.
Cypress Technology has always been
known as a “happy company” within the industry. During the financial tsunami of
2008, Cypress Technology did not lay off employees. Chairman Tsai recently told
employees that the average life span of global companies is about ten years,
and there are very few companies over a hundred years old. It’s the goal of
Cypress Technology's sustainable business plan to become a century-old company.
Chairman Tsai pointed out that
observing the invisible champions of international business has revealed three
major characteristics. The first is “small and beautiful,” the second is that
they all have their own brands, and the third is a focus on global trade, not
just targeting a domestic market. More importantly, these companies understand
and stick to their core competencies and will not jump outside of their primary
business too quickly. These three characteristics are also an important
reflection of team management.
Chairman Tsai emphasized that the
company must continue to make changes after it has reached a new stage. As the
new team becomes younger, the company's operating model must also change. Building
upon the inherited founding culture with continuous innovation, Cypress Technology’s
new management team has formed a consensus around the same goals, and will lead
the company forward to each milestone along the way to the next stage.