Specialisation means concentrating the production on a chosen good or service for which a production unit(individual, firm or a country) is more able as far as resources of production are concerned. In other words, it means producing what we produce best.
Specialisation is the production of a limited range of goods, and services by an individual firm or a country, in co-operation with others so that, together, a complete range of products can be produced.
Specialisation also means that the resources are being distributed among small and competing uses at a particular industry or a nation. For example, Maldives specialises in tourism and fishing products, Sri Lanka and India specialises in the production of tea. This is specialisation at national level. The specialisation of Thoddoo island for watermelons and Dhiggaru island for rihaakuru is an example of regional specialisation.
Potential benefits of specialisation
- Higher output: the total output of goods and services will increase and the quality of goods and services produced will increase. A higher output with lower prices will mean more wants will be satisfied with the given amount of scarce resources.
- Variety: consumers have improved access to a greater variety of goods and services and thus, have better choice both from their economy and production of other countries.
- A bigger market: specialisation and international trade increases the size of the market, offering opportunities for large-scale of production for a larger market
- Competition and lower prices: Increased competition for domestic producers acts as an incentive to minimize costs and to be innovative to remain competitive. Competition will help to keep the prices lower in the economy.
Specialisation at individual level involves giving workers individual jobs so that the worker’s capacity to one task in particular will increase. Example, the specialisation of teachers in different subjects in CHSE. Specialisation by individual is called ‘division of labour’. Division of labour refers to the separation of a work process into a number of simple and separate tasks, with each task being performed by a separate person or a group of people.
It is most often applied to systems of mass-production and is one of the basic organizing principles of the assembly lines. Breaking down the work process into simple, repetitive tasks eliminates the unnecessary workers on an assembly line and limits the handling of different tools and parts of different workers. The resulting reduction in the production time and the ability to replace workers, who do repetitive work with simple tools, results in lower production costs and a less expensive final product.
The concept of division of labour was explained by Adam Smith using the example of a pin making factory. He pointed out that a worker will be able to make 20 pins a day if he were to do all the tasks of pin production himself. However, 10 workers working together specialising in the production of pins will produce 48000 pins a day. Hence increasing the production process into a great extent.
According to Adam Smith, “Wealth of nations”, the economic growth(ie. the increase in the value of goods produced in a country in a year) of a county lies in the concept of division of labour. Under this regime, each worker becomes an expert in one isolated area of production, thus increasing his efficiency. The fact that labourers do not have to switch tasks during the say further saves time and money. Ofcourse, this exactly allowed Victorian factories (UK) to grow throughout the nineteenth century and develop themselves and their country simultaneously.
There are many advantages and disadvantages to specialisation, which became common place during the industrial revolution with the creation of factories and the use of division of labour. The work is divided among many different workers and each worker becomes a cog in a large machine.
Advantages of division of labour
Adam Smith recognized that the increased productivity of labour after division happens due to the following reasons.
- Workers become very skillful and effective int their single allocated task. This is because the workers who specialize in a single task have a lot of time and occasion to practice their allotted job. This can lead to increase speed and accuracy and skill in the narrow range of tasks he perform. Workers in a factory who are responsible for only one part of the process become as skilled as they possibly can in that process without the distraction of learning other skills in the other areas. This increases the productivity (output per worker per hour) as well as quality of work done by a worker. Practice makes perfect!
- Another reason is that, time is saved by eliminating the constant need to move from one operation to the next by the worker. They stay or stand in one place. Any capital machinery that they use is also run constantly.
- Some automation (use of specialised machinery) may arise from the division of the general manufacturing process into small, separate and simple tasks. This in turn may greatly speed up the individual jobs which are automated. This effect is caused because once the jobs are broken down into the simplest possible jobs, it becomes much more, apparent to find methods or invent machinery that will save time or increase quality and accuracy of that work.
- It is also generally considered that, because of the cost of training, workers to perform simple tasks is far less than training each worker to complete the whole production process, division of labour can lower average cost of production
Drawbacks of division of labour
Although division of labour can lead to considerable gains in the productivity and quality of production, division of labour can also have negative effects on the production for the following reasons.
- Dependency on the whole labour force is increased with very high level of division of labour. With increased division of labour, the breakdown of one particular machine in the middle of a production line or an absence of a worker can halt the whole production process. For example, a strike in one part of the factory can halt the whole production process.
- It creates the possibility of increased unemployment among the labour force of the country. Very high degree of division of labour can create demand for very specific, narrow skills. This, in turn, may lead to the general workforce acquiring narrow skills. In the long-term, this may lead to unemployment, a type of structural unemployment where the worker is replaced by a machine, and because the worker’s skill is no longer required, the worker has trouble finding employment, because he is not trained in anything else.
- A major drawback of division of labour is, boredom and alienation, which people may experience when carrying out very simple repetitive tasks. This may have a negative effect on the labour force and labour relations and eventually the productivity of the workers.