What leadership style involves taking corrective action only after mistakes have occurred?

The leadership style that involves taking corrective action only after mistakes have occurred is characterized by a reactive approach to management. Passive management-by-exception focuses on leaders intervening only when issues become evident, rather than proactively addressing potential problems before they escalate. This hands-off approach can lead to a lack of ongoing monitoring of performance, with the leader only stepping in when performance standards are not met or when a mistake has been made. This can create an environment where issues are allowed to fester, leading to more significant problems down the line, as the leader is not actively seeking to monitor or improve performance but waits for failure to occur.

In contrast, approaches like transaction leadership and active management-by-exception involve more engagement from the leader, with a focus on setting clear expectations and monitoring performance to provide feedback and corrections actively. Laissez-faire leadership typically involves minimal interference in the team's activities, but it does not specifically relate to the timing of corrective actions in response to mistakes. Thus, the key characteristic defining passive management-by-exception is the leader's tendency to wait for issues to arise before taking action, making it the correct answer to the question.