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CMA Final · Entrepreneurship and Startup · Leadership

A founder of a fintech startup stops giving detailed instructions once her team becomes skilled and motivated. She now sets broad goals and lets team members decide how to reach them. Which leadership style does this most closely describe?

This is laissez-faire (free-rein) leadership. The leader gives broad goals and delegates the decisions on method to a skilled, motivated team. It differs from autocratic leadership, where the leader keeps decision power, and from transactional leadership, which depends on rewards and penalties.

  1. AAutocratic leadership
  2. BLaissez-faire (free-rein) leadershipCorrect
  3. CTransactional leadership
  4. DPaternalistic leadership

Explanation

Setting broad goals and leaving the method to skilled team members is the essence of laissez-faire or free-rein leadership. Autocratic leadership would centralise decisions. Transactional leadership relies on rewards and penalties tied to performance, which is not described here.

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