KUALA LUMPUR (Oct 23): Only 26% of manufacturers have adopted artificial intelligence (AI), with most still in the exploratory stage, said Helena Eian, chairman of the Federation of Malaysian Manufacturers (FMM) Selangor and Kuala Lumpur branch.
Those already using the technology, however, are seeing tangible benefits, she added.
“Despite the slow pace of adoption, firms that have deployed AI are applied across diverse functions, including customer service, inventory management, product development, product optimisation, and quality management and control, with niche applications such as cybersecurity, enterprise resource planning (ERP) integration, and predictive maintenance also emerging. Early adopters are already reaping clear benefits,” she said during the panel session titled “From Borders to Breakthroughs: AI’s Role in Global Industry Transformation” at the Futurex Connect event organised by Sunway iLabs, held at Sunway Resort Hotel.
Among manufacturing companies that have incorporated AI solutions, 60% reported improved productivity, 57% faster decision-making, and 46% better resource management, said Eian.
“Additional benefits range from enhanced customer experience and quality improvements to cost reduction, highlighting AI’s potential, not just for operational efficiency, but also for competitiveness and innovation,” she said.
While the rate of adoption remains low, Eian highlighted AI’s transformative potential within the manufacturing sector. For instance, early, experimental deployment across various business functions demonstrates tangible returns for the companies that have taken the lead.
“Manufacturers are increasingly realising that AI contributes directly to their overall business goals, particularly profitability,” she said.
Eian also said that Malaysia’s diverse manufacturing ecosystem makes it a practical testing ground for AI applications.
“We could directly improve productivity through data-driven decision making by integrating smart analytics and adaptive automation into existing operations, especially in sectors such as electronics, automated and food manufacturing,” she said.
Under Malaysia’s New Industrial Master Plan 2030 (NIMP 2030), the country has aligned its aspirations with industrial upgrading, workforce upskilling, and investment incentives, said Eian.
“The NIMP 2030 aims to transform 3000 smart factories as this will encourage the industry to take up and create high skill jobs for the manufacturing industry. This policy provides confidence to both local and foreign investors, while strengthening the overall industrial
ecosystem through innovation collaboration and technology adoption,” she said.
“Malaysia offers a multilingual, tech savvy workforce and strong connectivity infrastructure. English proficiency and cultural openness makes it easy for international startups and technology providers to collaborate and scale solutions here, using Malaysia as a launchpad into the wider Asean market.”
On a related note, Sunway’s deputy chief information officer Wan Hock Wei said that the country’s public and private sectors must work together to accelerate technology adoption among local companies.
“The government is actually doing a lot in terms of funding, for example, building a sovereign AI cloud. There was a RM2 billion investment in AI, alongside initiatives such as the National AI Roadmap and the National AI Office. There’s a lot of engagement happening,” he said during the panel discussion.
As for the private sector, he pointed to Sunway’s active role in promoting AI adoption. The company has established grants to support the industry’s efforts in advancing AI capabilities.
“Within Sunway, and across many other Malaysian companies, there’s a strong focus on finding ways to advance and implement AI. That’s why I believe that through collaborations with countries such as Japan, China and Korea, we can explore how their solutions can benefit Malaysian companies,” said Wan.
Sunway Group’s non-executive chairman Prof Datuk Seri Idris Jala added that while Malaysia is making significant progress in adopting technologies such as AI, many local companies struggle to succeed globally due to the country’s complex regulatory environment.
“A problem [we have] is that we spend all the time creating rules. The problem when you create the rules is that it becomes difficult for businesses to adopt innovation. If we do a study and ask the question, how many of these rules [created] are a hindrance and how many are the ones that help us to progress, I guarantee the answer is, more than 80% of them become a roadblock to innovation,” he said during his keynote address titled “Breaking Borders: Turning Local Potential into Global Impact”.
He stressed that Malaysia must rethink its regulatory approach if it wants to compete globally.
“If we want to just continue with rules and regulations, [it] is fine, but if we want to move at a rapid pace to compete in the global world, we cannot have too many rules. If we have done that, then we gather all the best and the brightest ideas, like we did today. And we ask the private sector, which one of you wants to go and expand your businesses abroad? What help do you need from the government just like they do in China? Precisely what? What help do you need?” asked Idris.