Managers will be forced to learn a new set of skills as a result, including how to divide work into manageable microtasks, recruit specialists to complete them, guarantee acceptable quality, and combine various components into comprehensive solutions. Companies will learn to rely on a new breed of intermediaries, from simple problem posers like InnoCentive to small assignment brokers like Amazon’s Mechanical Turk.
Additionally, hyperspecialization brings about new social problems like the potential for exploitation as jobs are quickly filled by the cheapest bidders and the potential for deceit when employees are blind to the bigger goals they are advancing. While guild-like organizations may be able to address workers’ needs for ongoing skill development and a sense of community, new international standards or regulations may be necessary.
The productivity gains from breaking down work into ever-smaller tasks carried out by ever-more specialized workers are largely responsible for the prosperity our world currently experiences. These days, this division of labor has developed to the point where the next difference in degree will constitute a difference in kind because of the growth of knowledge work and communications technology. We are moving into a time of hyperspecialization, which will create a very different and still poorly understood type of workplace.
Given how complicated today’s supply chains are, one might believe that we’ve already reached the peak of specialization. For instance, Boeing’s initiative to construct the 787 Dreamliner was hailed as the height of subcontracting—but later revealed to have gone too far when the components failed to work together as smoothly as envisioned and delays occurred. There are 379 links on a webpage that only lists the “major” suppliers of the plane’s parts. But an aircraft is fundamentally a physical product. When work produces knowledge-based, intangible goods and the information used can be transported anywhere in the world almost instantly and almost for free, think about how much more finely work can be diced.
We will now witness knowledge worker jobs, such as salesperson, secretary, and engineer, atomize into complex networks of people all over the world performing highly specialized tasks, just as people in the early days of industrialization saw single jobs, such as a pin maker’s, transform into many jobs (Adam Smith observed 18 separate steps in a pin factory). Soon, even modern job titles will seem quaint to us. For instance, the term “software developer” already hides the fact that various specialists are frequently in charge of the design, coding, and testing phases of a software project. And that is the simplest scenario. The same software may be impacted by dozens of contributors when TopCoder, a startup software company based in Connecticut, gets involved.
The possibility of becoming a “top coder” is made possible by TopCoder, which divides up its clients’ IT projects into manageable pieces and makes them available to its global community of independent developers as competitive challenges. For instance, a project might start with a competition to find the best concept for a new software product. A second competition might offer a general outline of the project’s objectives and challenge programmers to produce the document that most effectively translates them into specific system requirements. (TopCoder hosts a web forum where developers can ask the client for more information, and all of the questions and responses are made public to all rivals. (The winning specifications document may serve as the foundation for the following competition, in which additional developers compete to design the system’s architecture, defining the necessary pieces of software and their connections. Additional competitions are held to develop each component separately before combining them into a functional whole. Finally, more programmers compete to find and fix errors in the system’s various components.
The intriguing aspect of TopCoder’s business model is what it enables its network of nearly 300,000 developers from more than 200 countries to do. A developer who excels at designing user interfaces, for example, can devote the majority of his or her time to doing so because the company aggregates demand for those particular tasks. Indeed, TopCoder developers are becoming increasingly specialized. Some programmers specialize in creating particular types of software, like tiny graphics modules. Some people have a knack for assembling software components that others have written. And some specialize in fixing bugs in other people’s code.
This hyperspecialization is successful in the long tradition of the division of labor. TopCoder can often provide its clients with development work that is comparable in quality to what they would get by more traditional means but at as little as 25% of the cost And it accomplishes this while retaining a community of programmers who are content and well-paid. As we’ll discuss, the potential benefits in terms of quality, speed, and cost almost certainly result in the model becoming more popular. We need to be aware of any potential risks associated with hyperspecialization in order to make sure it is as welcome as it is likely to be.
What are the benefits of specialization of labor?
There are many benefits to using specialization of labor, including:
Encouraging mastery
Employees frequently become experts at their assigned task because they frequently repeat one stage of the production process. This can help companies create economies of scale. Because of economies of scale, businesses can increase their output while cutting costs. Some businesses may find it simpler to achieve economies of scale through labor specialization because employees can get better at their jobs and boost output.
Employees learn to perform a task expertly when they concentrate on it. The speed and quality of their outputs can be increased by learning just one new skill. They are able to advance in their specialized field and increase their output because they are not attempting to learn multiple tasks or accommodate numerous process phases at once. Specialization not only promotes greater effectiveness and efficiency but also innovation. Specialized workers who are proficient in their tasks can create fresh plans to enhance current procedures.
Efficient
Labor specialization can also help businesses increase productivity and save time. Companies can have each employee concentrate on particular sub-tasks when they use assembly lines to specialize labor. This eliminates the need for them to wait for the completion of a product or service before creating the following unit. Additionally, it offers precisely stated expectations with little room for misunderstanding. Employees lower their risk of error because they repeatedly perform the same tasks. Employers can maximize their outputs and streamline production by using specialization of labor.
Specialization can be more efficient for companies too. Businesses that concentrate on releasing one product or a small number of products on the market are frequently more successful than those that produce a large number of products. This is what business economists refer to as a company’s core competency, where it develops one key strength. In production, its called specialization of labor.
Optimizes employee skills
This strategy also has the advantage of fully utilizing certain employee skills. Finding workers who are knowledgeable about every stage of your production process is difficult. It may be simpler to find employees with the necessary skills if you break down your process into defined tasks. Labor specialization allows experts to perform their jobs to a high standard. Because you’re working out less and producing more, this can increase productivity. Utilizing particular skill sets effectively through labor division can boost employee satisfaction.
Some jobs may be better suited for certain people than others due to their varied educational backgrounds, talents, work experiences, interests, and skills. You can maximize each employee’s unique skills by identifying areas in your processes where they can apply them.
Cost saving
Specialized labor can increase productivity and lower production costs. Establishing set tasks can help businesses scale effectively and efficiently, especially as they grow. A rise in production may result in a drop in the cost of individual units. Without specializing, scaling can be difficult to execute effectively.
However, businesses that choose not to grow their operations can still experience cost savings through labor specialization. It may make it simpler for them to comprehend the number of employees they should designate for particular tasks. This can lower the number of redundant employees they have, enable them to hire people who are proficient in just one skill, and result in lower training expenses.
What is the specialization of labor?
When businesses divide their production or service process into several defined tasks, specialization of labor, or division of labor, results. Instead of performing numerous tasks themselves, workers repeat a single step of the production process. Specialization of labor can give businesses a competitive edge, make it simple to scale their operations, and increase production. When faced with significant, labor-intensive tasks, businesses frequently implement specialization of labor. Businesses can give employees or groups of employees more manageable work that is simpler to complete repeatedly by assigning subtasks to those individuals or groups.
Workers who specialize their work frequently receive training for a particular task Their efficiency can be increased by experience, and the abilities they acquire can open up career opportunities in their industry.
What are the drawbacks of specialization of labor?
While labor specialization can greatly enhance production processes for the majority of businesses, there are some disadvantages as well. If you’re considering using labor specialization in your business, keep the following in mind:
Difficult to sustain
If you employ this strategy, make an effort to communicate with your staff frequently. Repeated actions may eventually cease to be stimulating or challenging for them. While the approach can produce effective teams in the short term, longer-term assignments may result in boredom, which can cause workers to become distracted and reduce productivity. There are ways to combat this, however. One way to reduce employee burnout and increase labor resources for particular tasks is through cross-training.
Can encourage dependency
The dependence on specific components of your production line is another possible drawback. When a team member leaves, production may be hampered if each member is so highly specialized as to be impossible to replace. Again, cross-training can help you combat this. Knowing each person’s skill set and the requirements of their particular job can help you allocate resources effectively and reduce your reliance on particular employees. In this manner, your production won’t slow down as a result of a lack of labor resources to dedicate to a particular production phase.
Not always a viable option for small businesses
Although labor specialization can greatly benefit large-scale business operations, implementing this strategy may be difficult for smaller businesses. Many small business owners and entrepreneurs handle a wide variety of tasks by themselves. This can help them establish their brand early on and maintain control over the story and caliber of their business outputs. These businesses often rely heavily on cross-trained team members.
If a business is small or just getting started, choosing to hire out every individual task may be a waste of resources. They might not give their team members enough to do, which would lower productivity and raise costs.
Examples of specialization of labor
Here are a few more instances of how specialization of labor across industries can be demonstrated:
Example 1
A server in a restaurant is an illustration of labor specialization. A server wouldn’t typically assist the valets in parking patrons’ cars or enter the kitchen to prepare food. Servers can concentrate on a specific set of duties because their work is specialized. Serving clients, taking orders, delineating menu items, and collecting payment for meals are typically included. The server can respond to clientele’s needs and contribute to the restaurant’s goals by concentrating on predetermined tasks.
Example 2
One of the most well-known examples of labor specialization is found in factories. Assembly lines are created by factory workers, who finish one stage of production before moving on to the next. For instance, a worker at a car assembly plant might inspect the quality of auto parts. The piece they send through moves to the following stage after they complete the check. Because they are concentrated on a single task rather than various stages of car assembly, that single employee is probably able to process large volumes of materials.
Example 3
Hospitals, which can have hundreds of job classifications, serve as the best illustration of this idea. Due to the time required for professionals to acquire their skills, specialization is crucial in this situation. Cross-training isnt always a viable option in these settings.
For instance, an ICU nurse is frequently assigned to a particular area of the hospital. Where they gather patient data and attend to their needs, they might have a set group of patients or rooms. Hospitals and nurses can guarantee patients receive the best care by assigning tasks so they don’t have to worry about extra responsibilities like room cleaning or issuing visitor tags.
Specialization and Division of Labor
FAQ
What is an example of labor specialization?
For instance, a bicycle rental service essentially transforms a product into a service. This is a form of specialization because neither the service nor the manufacturer needs to be knowledgeable about the difficulties involved in running a rental business.
What is labor specialization history?
Specialization of labor is a classic economic theory. Plato discussed the specialization of labor in his work “Republic”. When discussing this theory, Plato claimed that the state could meet its needs with just four or five people.
