South Africa’s manufacturing industry is lagging behind the tech curve

A new study conducted by World Wide Worx in partnership with ERP software provider SYSPRO highlights that South African manufacturers have fallen behind the technological curve when compared to other industries.

The study, named The Mobile Corporation in South Africa 2019, was presented by SYSPRO and World Wide Worx at the Hyatt Regency Hotel in Johannesburg.

The data from this study was collated from telephonic interviews with 400 high-level decision-makers at SA enterprises, with manufacturing companies forming around half of this sample.

“This study provides interesting and surprising insight into the minds of the C-suites’ thinking when it comes to the adoption and overall ‘follow-through’ of advanced technologies,” said Mark Wilson, Managing Director at SYSPRO Africa.

“There must be a shift in thinking, top–down, if organisations are to remain at all competitive in a globally competitive landscape.”

Study findings

A key finding of the study was that manufacturing enterprises are less interested in the high-tech capabilities of their technology products than enterprises in other industries.

Only 43% of manufacturing enterprises said that this is an important factor when choosing new technology products – compared to a figure of 57% across all industries.

“This shows that manufacturing companies are not focused on high-tech technology, but rather just on keeping the lights on,” said World Wide Worx CEO Arthur Goldstuck.

“Manufacturing is key for 4IR, but it doesn’t appear that the manufacturing sector is on board,” he added.

The study also found that ERP systems are the biggest source of tech expenditure for enterprises – with 34% listing their ERP as the technology they invest the most money in.

Goldstuck believes that the main reason for the popularity of ERPs is that they are good at helping businesses to cut costs – which is crucial in the current economic climate.

However, only 32% of manufacturing enterprises listed ERP systems as their biggest source of expenditure, as opposed to 36% of enterprises in other industries

Other interesting insights from the study include:

  • The most important factor for enterprises when selecting an ICT technology is price – which in previous iterations of the study had only been the third or fourth priority.
  • While 63% of 2018’s respondents planned to use AI or Machine Learning in the future, only 21% responded similarly in 2019.
  • IoT usage has increased significantly – from about two-thirds of enterprises in 2018, to 92% in 2019.
  • The most significant change in usage numbers was with robotics, as the percentage of respondents using this technology rose from 6.2% to 37.6% over the past year.
Mark WIlson SYSPRO
Mark Wilson, Managing Director at SYSPRO Africa.
arthur goldstuck
Arthur Goldstuck, World Wide Worx CEO

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South Africa’s manufacturing industry is lagging behind the tech curve