I always think of Adam Smith when I hear the term 'division of labour' - but I'm being cured of this by reading a bit more about Britains late 18th century in Jenny Uglow's The Lunar Men. A very good read on industrialists and doctors, it remarks on Matthew Boulton's (think steam engine / manufacturing) explanation to Lord Warwick (in 1773) that it is ithe seperation of processes which allow British manufacturers to compete with continental Europe. So Adam Smith's comments were not so much brilliant discovery, but rather explanation of well established fact:
Lord Shelbourne had anticipated him [Boulton] when he reported on the Birmingham hardware trades seven years before [in 1766], putting its success down to three factors: the shaping of malleable metal by stamping machines, which replaced human labour, the division of labour between as many hands as possible, making tasks so simple that even a child could do it (and oftent did), and the 'infinity of smaller improvements which each workman has and sedulously keeps secret from the rest'. (Uglow p. 212, citing Fitzmaurice)
Indeed it seems that the term and idea were discussed through the decade as the big manufacturers invented and built their factories, although such "specialization had been applied in different British trades for some time; the added efficiency of employing a workman for one particular operation was common knowledge" (ibid, citing Berg).
For me it goes to show that people will be credited for inventing things, when they are often re-stating common knowledge.
Uglow, Jenny, 2002, The Lunar Men, London: Faber & Faber
Fitzmaurice, Lord Edward, 1875-76, Life of William, Earl of Shelbourne, vol. I, London, p. 277
Berg, Maxine, 1985, The Age of Manufactures: Industry, innovation and work in Britain 1700-1820, Blackwell Publishing, p. 293