The authors of this article argue that work in the 21st century is more complex instead of being routine. Solution of education management problems in the Baltic Region is greatly affected by system approach ideas that treat actions as a unified system that consists of mutually related elements with constant interaction of internal and external environment factors. The evolving nature of school environment has placed new demands on educational leaders. Where knowledge of school management, finance, legal issue and state mandates was once the primary focus for the preparation of school leaders, education reform has created an urgent need for a strong emphasis on development of instructional leadership skills to promote good teaching and high level learning. Educational leaders must recognize and assume a shared responsibility not only for students’ intellectual and educational development, but also for their personal, social, emotional and physical development. In the article was discovered that school principals need to improve their management competences in personnel management, financial and communication management for successful school leadership.