Final answer:
Team decision making secures higher commitment from members due to collective involvement in the decision process, leveraging various perspectives and expertise. While it can incur higher transaction costs, the commitment and the ability to address complex issues make it an effective approach, depending on the context and needs of the organization.
Step-by-step explanation:
An advantage of team decision making is that it secures higher commitment from members. This higher commitment stems from the team members being collectively involved in the decision-making process, which can make them more likely to support and implement the decisions made. Although team decision making can sometimes take longer due to the need for discussion and consensus (hence higher transaction costs), this is often offset by the increased commitment and the resulting benefits of that commitment.
Moreover, team decision making can lead to better decisions because different perspectives and expertise can be brought together to address complex issues. This aligns with the idea that in smaller groups, collective action problems such as free-riding or difficulties in monitoring individual behavior are less severe than in larger groups. In smaller teams, peer pressure is also a stronger motivator, which contributes to the effectiveness of team decision making.
However, it is crucial to recognize that despite the advantages, team decision making is not always better than individual decision making. The choice between the two should be based on the situational context and the specific needs of the organization. For instance, in cases where quick decisions are necessary, lower transaction costs by delegating decision-making power may be preferred. Nonetheless, the increased commitment from members in team decision making remains a significant benefit.