By PATRICK NDEGWA
Kenya’s manufacturing sector has been a notable driver of economic growth, contributing to development and employment. The sector’s growth has been primarily driven by agro-processing, textile and apparel, as well as chemical manufacturing. However, it faces challenges such as high production costs, inadequate infrastructure and stiff competition from cheap imports. Despite these challenges, the government has made significant efforts to promote the sector through policy and infrastructural investments.
COVID-19 also had a significant impact on the industry. Restrictions on movement and social distancing disrupted supply chains and reduced demand for non-essential goods. The sector faced challenges such as a shortage of raw materials, reduced labour productivity due to work restrictions and health concerns, and decreased access to credit.
The pandemic also exposed the vulnerability of the sector’s reliance on imported inputs and highlighted the need for local production of essential goods. Although the industry is constantly under pressure to boost output and efficiency while cutting costs, technological advancements and the Internet of Things (IoT) have the potential answer to these challenges.
Challenges and opportunities
Manufacturing in East Africa has a long and rich history, dating back to the early 20th century when countries like Kenya, Tanzania, and Uganda were under colonial rule. During this time, the industry was primarily meeting the needs of colonial powers, with the production of goods like textiles, tobacco, and sugar. However, following independence in the 1960s and 1970s, many countries began to invest heavily in their manufacturing sectors as part of efforts to boost economic development and reduce their reliance on primary commodities.
Despite significant strides made in the past, manufacturing in East Africa has been in decline in recent years. Many factors have contributed to this trend, including poor infrastructure, limited access to finance, and a challenging business environment. However, the revitalisation of the manufacturing sector remains critical for our economies. A thriving manufacturing sector can create jobs, boost export earnings, and provide a pathway for industrialisation and economic development.
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Additionally, it can contribute to technological advancement, foster innovation, and provide opportunities for local businesses to participate in global value chains. As such, governments need to prioritise policies that support the manufacturing sector by investing in infrastructure, providing access to affordable finance, and embracing digital transformation.
Prioritising digital transformation
A digital transformation is no longer just an option; it is necessary for businesses across industries to remain competitive and relevant. This is particularly true for Kenyan manufacturers, who need to prioritise digital transformation to keep up with the global shift towards Industry 4.0. The fourth industrial revolution is characterised by the integration of emerging technologies like AI, the Internet of Things (IoT), robotics, and cloud computing into manufacturing processes. To fully leverage these technologies and gain a competitive advantage, manufacturers must prioritise digital transformation.
Digital transformation in manufacturing should ideally include integrating digital technologies into every aspect of the production process, from design and planning to production and delivery. This includes the implementation of smart factories, which are characterised by using connected devices and sensors to gather real-time data on production processes. By leveraging this data, manufacturers can optimise production, reduce downtime, and increase efficiency.
Additionally, digital transformation enables manufacturers to enhance the customer experience with technologies like augmented reality (AR) and virtual reality (VR). For example, you can use AR and VR to create virtual product demonstrations, immersing customers in the product experience. Ultimately, prioritising digital transformation will enable companies to remain competitive and meet the evolving demands of customers and the industry.
Increased usage of IoT devices in manufacturing offers numerous benefits, such as improved efficiency. IoT devices can provide real-time data and analytics, helping manufacturers identify inefficiencies and adjust quickly. This, in turn, enhances quality control, as IoT devices can monitor production lines and identify defects. Furthermore, increased productivity can be achieved through IoT devices automating manual tasks, reducing the need for human intervention, and enabling manufacturers to produce more goods in less time.
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Another benefit is cost savings, as IoT devices can help manufacturers optimise energy usage, reduce waste, and improve maintenance schedules. Finally, this technology can improve safety by monitoring factory environments and detecting potential hazards. Overall, increased use of IoT devices in manufacturing can help companies improve operations, reduce costs, and increase competitiveness in the global market.
Using IoT devices in manufacturing has offers a myriad of benefits. Therefore, industrial and manufacturing enterprises should consider partnering with internet and managed service providers to meet their connectivity needs and leverage the rewards of IoT devices. By doing so, these enterprises can enhance their competitive edge, improve customer satisfaction, and increase profitability.
With the right tools, enterprises can collect, analyse and act on the data generated by IoT devices, thereby improving decision-making and business outcomes. Working with expert service providers can help optimise the use of technology and minimise the risks associated with managing connectivity on your own. These partnerships represent a strategic move for industrial and manufacturing enterprises seeking to leverage expanded connectivity’s benefits and enhance overall operations.
Patrick Ndegwa is Business Sales Lead for SEACOM East Africa