We most commonly apply it to systems of mass production. It is also one of the basic organizing principles of the production or assembly line in a factory.
If each worker or group of workers focuses on specific tasks, there is less unnecessary motion and handling of different devices, parts, and tools.
BusinessDictionary.com has the following definition of the term:
“Narrow specialization of tasks within a production process so that each worker can become a specialist in doing one thing, especially on an assembly line.”
“In traditional industries, division of labor is a major motive force for economic-growth.”
Division of labor – lower costs
Rather than employing well-paid craftsmen, the employer can use lower-paid unskilled workers, which reduces production costs.
However, the division of labor often does not always lead to declining skills among the working population.
Adam Smith (1723-1790), a Scottish economist, philosopher, and author, saw the division of labor as vital for economic progress.
The division of labor helped economies grow during the nineteenth and twentieth century. Since the turn of the century, mass customization, which requires several skills and an extremely short machine change-over time, the concept of the division of labor has become more flexible.
Mass customization is a strategy that involves offering products designed to the unique specifications of each customers. However, the manufacturer still uses mass production techniques to achieve low costs. A manufacturer converts raw materials and components into finished products.
Regarding Adam Smith, Prof. Sally Haslanger of MIT and Dr. Rachel McKinney of Suffolk University wrote:
“Adam Smith argues that the fundamental cause of the division of labor is the human propensity to exchange goods and services with one another, and that the division of labor is developed as the best way to maximize the satisfaction of that propensity.”
Adam Smith coined the phrase Division of Labor in his 1776 classic ‘The Wealth of Nations.’