To continue with the advantages of the
division of labour, we can recall what Adam Smith himself has said. He gives
the example of pin-production. Suppose a worker is able to produce 20 pins a
day. And if making of pins is divided into 18 parts, then, all the workers put
together will be able to produce 20,000 pins in a single day. So, the manifold
increase in production brings advantage to the producer.
In what way, the increase in production
is an advantage, one might ask. Without
going deep into the mechanics of marketing and market forces, today, in fact,
any day, business is competition. And competition means you have to win in the
competition largely to remain in the business; winning means winning over the
other producers of the same commodity. They use the word, the rival in business
language. Availability of your product is the first essential point in the
business. In that sense, increase in production means readiness to supply your
product to the users all time. You have to employ more men, no doubt. But the
revenue they bring you is generally more than you spend on them.
Winning your rival does not begin and
end with the number only. It is much deeper.
There is the great permanent price war. You must be able to give your
product a little bit less in cost. Here also, increased production gives the
business man some flexibility in fixing the price. Thus, we find increase in
production has some advantages and the division of labour comes very helpful
There are some other advantages also to
the employer, that is, to the producer. All employers know for a fact that an
inefficient employee will prove more a burden wasting time and money in the
form of equipments. Here, selecting a right person will not be a difficult task
because in the context of division of labour, a worker will be doing a part of
the whole job and it is easy therefore to check him whether he is fit for the
small job. In other words, selection of a right man for the right job does not
tax the employer. It is not like selecting a manager or finance officer where
they have to concern themselves generally with the whole of the organization in
respect of their responsibility.
Another advantage for the producer is it
saves lot of money. It is enough he gives the worker what tools he requires for
his part of the job. Supposing he is the only worker, he must have, say, ten
instruments to complete his job. But in the division of labour, each worker
need not be given the ten required instruments for the job. In that sense, it
saves money for the employer, the producer.
In one more sense also, it saves money
for the producer. Generally, the workers must be given training. In big
companies and corporate, there is budget allotment for training of the workers.
Here, in division of labour, training an employee will not cost much because he
is trained only for that small portion of the work allotted to him.
Another great advantage that results from this
cost-effective training is the great possibility of producing quality products.
Becoming efficient in doing a small part of a big job is far easier than
becoming efficient in carrying out a big job by himself all alone.
Having seen the advantages of the
division of labour for the producer, we shall next deal with the advantages for