The rapid pace of technological advancement, driven by artificial intelligence, machine learning and automation is fundamentally transforming how things are done.
Manufacturing is no exception. Automation which is an outcome of digitization is replacing repetitive and routine tasks, freeing workers to focus on more complex, creative and interpersonal activities. Notably, robotic assembly lines are now standard in many factories not only raising productivity but also reducing labor costs.
Across the world, digitization has redefined manufacturing efficiency, and the lessons are instructive for Kenya’s own industrial ambitions. China is perhaps the clearest example of real-world proof of how automation sustains manufacturing competitiveness in the face of rising labor costs. The country has is among global leaders in factory automation, installing nearly 280,000 industrial robots annually, slashing to by half labour costs while doubling outputs.
India, an economy whose structure mirrors Kenya’s in many ways, demonstrates how emerging markets can harness technology to reduce costs while preserving their labor advantage by adopting AI-powered predictive maintenance systems. Germany on the other hand has demonstrated the power of policy-driven digitization. So far, over 90 percent of its industrial companies have reported annual efficiency gains of over 3 percent.
But digitization in manufacturing is not just about efficiency. It is about making manufacturing smarter, greener, and future-proof. This demands a fresh mindset that marries innovation with responsibility. For Kenya, this is more than an upgrade – it is a chance to raise our competitiveness on the global stage. With AI-driven manufacturing, we can cut costs, speed up output, and achieve the kind of precision that puts us in the same ring as China, India and Germany.
Energy remains one of the largest cost drivers in Kenya’s manufacturing sector. Electricity alone can account for as much as 30 percent of total production costs in energy-intensive sectors such as food processing and personal care manufacturing.
According to data from the Kenya Power, commercial and industrial consumers account for approximately 55 percent of all electricity sold in the country, underscoring the central role manufacturers play in the national energy landscape. Given this reality, any effort to improve efficiency, reduce emissions, and advance sustainability within the manufacturing sector must necessarily address energy consumption.
Digital solutions offer a practical pathway forward. The integration of Internet of Things (IoT) sensors and AI-driven platforms is transforming how manufacturers monitor, analyze, and optimize energy use in real time. Sensors embedded within machines, production lines, and electrical panels collect continuous data on consumption patterns, temperature, and other operational metrics. This granular data allows companies to identify inefficiencies, schedule timely maintenance, and adjust operations to improve efficiency.
AI systems then process this data, uncovering trends and inefficiencies that traditional methods would likely miss. Automated adjustments help balance energy use with demand, while predictive analytics enable more accurate forecasting of consumption.
Beyond energy, digitization also enables predictive maintenance. By leveraging real-time data and machine learning models, manufacturers can detect potential equipment failures before they occur, preventing unplanned downtime. This approach not only reduces unnecessary energy consumption but also extends the lifespan of equipment, minimizing costly replacements and conserving resources.
Process and resource optimization is another critical benefit. Robotics ensure precise application of energy, water, and raw materials, while machine learning continuously improves efficiency over time. Smart systems that detect and address errors early reduce rejects and reworks, thereby cutting waste and lowering both costs and environmental impact. This demonstrates how digitization can align profitability with sustainability.
Future-proofing the sector is equally important. Manufacturing globally is increasingly shaped by factors such as climate change, stricter regulatory standards, rising energy costs, and supply chain disruptions. For instance, Pwani Oil has is actively investing in eco-friendly manufacturing practices, reducing waste, managing carbon emissions, and adopting efficient water and energy use as part of its climate action strategy.
Digitization provides manufacturers with the agility to respond effectively to these challenges. Real-time data, scenario modeling, and predictive insights allow businesses to remain compliant with regulations, adapt quickly to changing market conditions, and remain competitive in a global environment where sustainable practices are highly valued.
As Kenya navigates its industrial growth agenda, the lesson from global leaders is clear: manufacturing success in the 21st century hinges on the integration of technology and sustainability. By adopting digital tools that enhance efficiency, reduce emissions, and build resilience, Kenyan manufacturers can strengthen their competitiveness both locally and internationally.
By Rajul Malde, Commercial Director, Pwani Oil