EconomicsEconomicsLAP 7LAP 7

Divide and Divide and ConquerConquer

Specialization and Specialization and Division of LaborDivision of Labor

ObjectivesObjectives

Explain types of specialization.Explain types of specialization.

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

Explain types of specialization.Explain types of specialization.

ObjectiveObjective

• The varsity basketball The varsity basketball team has won 20 team has won 20 games in a row.games in a row.

• How? How?

• Each player specializes Each player specializes in what he does best. in what he does best.

SpecializationSpecialization

• Make the best use of our Make the best use of our resourcesresources

• Focus on the production of Focus on the production of certain productscertain products

• Trade or exchange them for Trade or exchange them for other things we need other things we need

Specialized Resources Specialized Resources

Natural resourcesNatural resources

Capital goodsCapital goods

Human resources Human resources

Forms of Human-Resource Specialization Forms of Human-Resource Specialization

• Specialization by trade or Specialization by trade or professionprofession

Type of work that you Type of work that you perform to earn a livingperform to earn a living

Most common type of Most common type of human-resource human-resource specialization specialization

Forms of Human-Resource Specialization Forms of Human-Resource Specialization

• Specialization by stage of Specialization by stage of productionproduction

Occurs when more than one Occurs when more than one stage is needed to change a stage is needed to change a raw material into a finished raw material into a finished product product

Forms of Human-Resource Specialization Forms of Human-Resource Specialization

• Specialization by task

Used when jobs are so specialized that a worker does one small part of the total job

Also known as division of labor

Scope and Specialization Scope and Specialization

• Scope:

The number of different operations in a job and the frequency with which they are done

Low level task = low job scope

Free Toy Free Toy inside!inside!

A tasty, nutritious, breakfast treat!

They’re Toadally awesome!

Adding toys to cereal boxes is low in scope, but developing the promotional campaign is a high scope job.

Depth and Specialization

• Depth:Depth:

The amount of control an The amount of control an employee has over the task that employee has over the task that is to be doneis to be done

Low depth = low decision-making Low depth = low decision-making powerpower

High depth = much decision-High depth = much decision-making power and ability to set making power and ability to set own pace own pace

Compare the advantages and Compare the advantages and disadvantages of specializationdisadvantages of specialization

and division of labor.and division of labor.

ObjectiveObjective

Advantages of Specialization Advantages of Specialization

• Simplified worker trainingSimplified worker training

Simplifying a job task Simplifying a job task makes it easier to teach makes it easier to teach and learn.and learn.

Advantages of Specialization Advantages of Specialization

• Increased employee interest Increased employee interest and satisfactionand satisfaction

Employees become Employees become proud of their part in the proud of their part in the process.process.

Advantages of Specialization Advantages of Specialization

• Increased production ratesIncreased production rates

As employees become As employees become familiar with their jobs, familiar with their jobs, they can increase they can increase company output.company output.

Advantages of Specialization Advantages of Specialization

• Increased level of skillIncreased level of skill

Skill level increases as Skill level increases as employees practice their employees practice their job tasks.job tasks.

Advantages of Specialization Advantages of Specialization

• Increased quality of workIncreased quality of work

As skill increases, the As skill increases, the quality of work increases.quality of work increases.

Advantages of Specialization Advantages of Specialization

• Ease of transferring to a Ease of transferring to a similar jobsimilar job

Because of their Because of their knowledge and skill, knowledge and skill, employees find it easier employees find it easier to transfer to similar to transfer to similar jobs.jobs.

Advantages of Specialization Advantages of Specialization

• Higher employee incomeHigher employee income

As employees become As employees become more productive, they more productive, they become more valuable.become more valuable.

Employers may give Employers may give employees a pay raise as employees a pay raise as a reward for outstanding a reward for outstanding performance.performance.

Disadvantages of SpecializationDisadvantages of Specialization

• Increased interdependencyIncreased interdependency

Results when each Results when each employee does just one employee does just one part of a total jobpart of a total job

Disadvantages of SpecializationDisadvantages of Specialization

• Increased boredom on the Increased boredom on the jobjob

Caused by continually Caused by continually doing the same taskdoing the same task

Disadvantages of SpecializationDisadvantages of Specialization

• Decreased pride in workDecreased pride in work

Caused by repetition or Caused by repetition or not seeing the final not seeing the final outcome of workoutcome of work

Disadvantages of SpecializationDisadvantages of Specialization

• Decreased morale and Decreased morale and enthusiasm for the jobenthusiasm for the job

Results from decreased Results from decreased pride in workpride in work

Workers can exhibit a “Who cares?” attitude.

Disadvantages of SpecializationDisadvantages of Specialization

• Increased chance of worker Increased chance of worker obsolescence because of obsolescence because of technological advancestechnological advances

Caused by continuous Caused by continuous changes in technologychanges in technology

Disadvantages of SpecializationDisadvantages of Specialization

• High degree of specialization High degree of specialization may cause difficulty in may cause difficulty in transferring or obtaining transferring or obtaining another job.another job.

Results from high salary Results from high salary expectationsexpectations

Combating theDisadvantages of Specialization

• Job enlargementJob enlargement

• Job rotationJob rotation

• Job enrichmentJob enrichment

• Job satisfaction Job satisfaction

• How is your work divided up?

• Advantages?

• Disadvantages?

• Ways to overcome disadvantages?

• According to his union contract, Elijah must use forklift to move everything.

• He’s not allowed to clean up the box that fell on the floor.

• Is this a case of specialization that’s gone too far?

• Is it a logical, efficient way to divide the labor based on know-how?

• What do you think?

MBAResearchAcknowledgments

Original DevelopersChristopher C. Burke,

April J. Miller, MBAResearch

Version 2.0

Copyright © 2011MBA Research and Curriculum Center®

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