Divide and Conquer Specialization and Division of Labor

Divide and Conquer Specialization and Division of Labor Economics LAP 7

Objectives Explain types of specialization. Compare the advantages and disadvantages of specialization and division of labor.

Explain types of specialization.

• Key to success: Specialization • Making the best use of resources in the production of goods and services

Specialized Resources • Natural resources • Capital goods • Human resources

Natural Resources • Some jobs and industries are dependent on: Ø Climatic conditions Ø Availability of natural resources

Capital Goods • Used to increase production and automate processes • Examples: Ø Hand tools Ø Machinery Ø Equipment Ø Computers Ø Buildings

Human Resources • Using your skills and abilities in jobs for which you are best suited • Doing what you do best • Two types of specialization of human resources: Ø Specialization by trade or profession Ø Specialization by stage of production or task

Specialization by Trade or Profession • The type of work that you perform to earn a living • Most common type of specialization • Examples: Ø Teacher Ø Account executive Ø Stock broker Ø Graphic designer

Specialization by Stage of Production or Task • Occurs when more than one stage or specialty is required to create a finished product • Different people usually involved at different stages and tasks of production • Example: Assembly lines

Job Scope • The number of different tasks involved in a job and the frequency with which they occur • Low job scope: Repeating the same task over and over • High job scope: Doing a variety of tasks without as much repetition

Job Depth • The amount of control you have over the tasks that you do

Job Depth • Low job depth: Ø Strict guidelines to follow Ø Not many decisions to make

Job Depth • High job depth: Ø Includes decision making Ø Allows employees to set their own pace

Compare the advantages and disadvantages of specialization and division of labor.

Advantages of Specialization • Simplified worker training • Increased employee interest and satisfaction • Increased production rates • Increased level of skill • Increased quality of work • Ease of transferring to a similar job • Higher employee and company income

Disadvantages of Specialization • Increased interdependency • Increased boredom on the job • Decreased pride in work • Decreased morale and enthusiasm • Increased chance of obsolescence • Difficulty transferring or changing jobs

Combating Disadvantages of Specialization • Increased job scope • Job rotation • Increased job depth • Motivation

• Specialization of labor in your home or workplace • What are the advantages? • Disadvantages? • How could you offset those disadvantages?

• Forklift operator can’t handle packages by hand. • A box falls off the forklift. • Is it okay for him to pick it up? • Has specialization gone too far?

Acknowledgments Original Developers: Christopher C. Burke, Aaron Mc. Mahon, MBAResearch Version 3. 0 Copyright

Digital-based photography sources: Think. Stock Photos Various images used in this presentation are ©

Copyright: All photographic digital images on this CD are owned by the aforementioned photographic resources or their licensors and are protected by the United States copyright laws, international treaty provisions, and applicable laws. No title to or intellectual property rights to the images on this CD are transferred to you. These sources retain all rights and are not to be used, digitally copied, transferred, or manipulated in any way. To do so is a violation of federal copyright laws.