Q.Handsen is the CEO of 'Newcastle Enterprises', one of the world's most successful companies. His success stories have been well documented. He chooses highly motivated and capable managers who can perform their tasks creatively and adequately without his help. He allows the group members to work on their own tasks and resolve issues themselves. He intervenes, but only when needed to correct an unfavorable situation. He does not use power unless it is absolutely essential. He even allows mistakes to happen for his people to learn from them. He supports them and supplies them the required information to complete the assigned task.

Handsen selects capable, self-motivated managers, lets them work and solve problems on their own, uses power only when essential, and steps in only to correct an unfavourable situation. This describes a leader who gives subordinates maximum freedom and intervenes minimally.

1. Leadership style adopted by Handsen This is the Laissez-faire (Free-rein) leadership style — the leader delegates authority almost fully, acts as a support/resource person, and interferes only when absolutely necessary.
2. The other two leadership styles based on the use of authority Leadership styles based on how a leader uses authority form a continuum from full leader control to full subordinate freedom. Besides free-rein, the other two are:

• Autocratic (Authoritarian) leadership — the leader centralises all authority, takes decisions himself and issues orders, expecting obedience; communication is largely one-way (top-down) and subordinates have little freedom.
• Democratic (Participative) leadership — the leader shares authority, consults subordinates and takes decisions after discussion with the group; communication is two-way and subordinates enjoy moderate freedom.

The continuum (leader's use of authority vs. freedom for subordinates):

| Basis | Autocratic | Democratic (Participative) | Laissez-faire (Free-rein) |

|---|---|---|---| …

(a) Handsen's leadership style

The passage gives a clear picture: Handsen chooses highly motivated, capable managers and then steps back — he lets them perform their tasks on their own, allows them to resolve issues themselves, uses power only when absolutely essential, intervenes only to correct an unfavourable situation, and even lets mistakes happen so his people can learn. He mainly supports them and supplies the information they need.

This is the hallmark of Laissez-faire (Free-rein) leadership. Here the leader delegates authority almost entirely to subordinates, gives them full freedom to set their own goals and find their own means, and functions more as a support/contact person than as a directing boss. It works best when subordinates are highly competent and self-motivated — exactly the kind of managers Handsen deliberately selects.

(b) The other two leadership styles based on the use of authority

Leadership styles can be classified according to how a leader uses authority. They lie on a continuum ranging from complete authority retained by the leader to complete freedom given to subordinates. Free-rein sits at one end; the other two styles are:

1. Autocratic (Authoritarian) leadership

• The leader centralises decision-making power and authority in his own hands.
• He gives orders and expects subordinates to obey without question; there is little scope for their participation.
• Communication is mainly one-way (downward), and the leader relies on his position and, where needed, on penalties.
• Suitable where quick decisions are required or where subordinates are inexperienced, but it can lower morale and initiative.

2. Democratic (Participative) leadership

• The leader decentralises authority and involves subordinates in decision-making, taking decisions after discussion and consultation with the group.
• Communication flows both ways (upward and downward), and subordinates are encouraged to contribute ideas.
• It improves motivation, commitment and the quality of decisions, though decision-making can become slower.

The three styles compared on the use of authority: …