The author begins by examining the historical, social, political, and economic factors that have reversed the expansionary phase of educational organizations from the standpoint of their implications for leadership requirements. Three overlapping areas of concern are identified and appropriate leadership skills and strategies within those areas are discussed. The three areas are, generally, planning, personnel, and politics. More specifically, the author is concerned with the allocation of resources in a time of retrenchment, the morale and motivation of teachers, and the role of their constituencies in the leadership approach taken by administrators and trustees. (Author/IRT)