By Sharon Atieno
Though Kenya is a force to reckon with in digitalization when it comes to use and access of digital technologies such as robotics, artificial intelligence and cloud computing, Kenyan manufacturing firms are yet to embrace the full potential of technology.
Speaking at a public forum held by Institute of Economic Affairs (IEA) – Kenya and Friedrich Ebert Stiftung (FES) in Nairobi, Jackson Wambua, policy and research officer, Kenya Association of Manufacturers (KAM) noted that the slow uptake in adapting technology has led to increased competition in products’ production from other countries especially within the East African Community.
“Digitalization is key in staying competitive,” he said, “if we are not going to bring the technology that is required in the free trade area agreements, other countries will have their way in.”
With the Kenyan government seeking to create 1.3 million manufacturing jobs by 2022 and using manufacturing to pave the way for Kenya’s future in a bid to move the economy from a low middle-income to an upper-middle income country by the year 2030, incorporation of technology in to the sector is needed.
Wambua noted that digitalization in capacity utilization will have multiplier effect, backward and forward integration that: “we need in areas such as agro-based industries where manufacturing base can really grow a lot of numbers in creating jobs.”
Though in most instances the negative impact of digitalization is seen as job loss, on the other hand, new jobs or demand in other skills is created. The 2018 World Economic Forum (WEF) argues that there is a need for a greater understanding of the potential of technology to create new high quality jobs.
The A to Z Textile Mills in Tanzania introduced a modern laser fabric cutting machine which led to the reduction of employees from a range of 25 to 35 people needed to do the same work to only 17 people. As a result, there was increased output rate which led to an extra 300 jobs being created in stitching, the next stage of production, which demanded specialized skills to operate sewing machine.
In his presentation, Wambua further noted that digitalization lowers per unit cost in production, in installation of robots, 3D printers and internet of things referring to components as well as reducing per unit cost in delivery cost because internet and smart phones for communication used artificial intelligence and cloud computing.
“Precision thereof, comes with quantity and quality, economies of scale,” he said.
The policy and research officer also noted that digital platforms such as Alibaba and Amazon are good for marketing and encourage competition. He further added that data management through digitalization enables access to information on where production of certain products was taking place which is essential in effective marketing of those products outside the country.
The benefits that the manufacturing industry stands to achieve from incorporating digitalization far outweigh the negative impacts therefore, in order for Kenya to fully realize its potential, the manufacturing sector must embrace digitalization.
