The Role of Leadership in Project Management – A Complete Guide

Supriya Bajaj

Senior Writer

Role of Leadership in Project Management

Project leadership is about planning the process and channeling the team’s efforts toward achieving the project outcomes. A Project Management Institute study estimates that there will be a 33% increase in the demand for skilled project managers by 2027. This reveals the cruciality of leadership in project management in the constantly evolving business landscape.

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The problem-solving skills, critical thinking abilities, and strategic competencies of a leader influence the success and outcomes of a project.

In this article, we have curated the nuances of project management, leadership styles, and must-have leadership skills needed for project managers to navigate the team toward the organizational goals, vision, and mission. 

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As businesses endure fierce competition, the role of leadership in project management becomes more crucial and pivotal than ever. Though project management has undergone a significant change in the digital era, the good thing is that project managers have a lot of tools and methodologies that can automate mundane tasks. Project managers and organizations must use project management software and modern methodologies to beat the competition and stay ahead.


What Is Project Leadership?

Project leaders navigate the team toward the specific outcome within a predefined time frame, scope, and financials. As it involves managing the project and the team, project leadership and management remains both an art and a science.

On the one hand, it is about using your interpersonal and communication skills to guide the team toward successful project completion and delivery on the one hand. While on the other, it also involves using analytical skills and logical reasoning to plan, track, monitor, and achieve project outcomes and remains a science.

As it is proven working as a team on a common project is more effective than working as individuals, leadership in project management is pivotal. It plays a key role in the seamless completion of projects and the successful functioning of an organization, irrespective of its size and scope.

Why Do Organizations Require Project Management Professionals?

Project lead managers play a crucial role in ensuring that, as a team, they achieve the intended outcomes within the defined time and budget span. Following are some reasons why businesses need project management professionals. 

1. End-to-End Project Management

Project management professionals shoulder the end-to-end responsibility of the planning, organizing, scheduling,  monitoring, and tracking activities to achieve the intended project outcomes. 

2. Build a Project Plan

Project leaders should prepare a comprehensive project plan outlining the scope, timeline, and budget. It should have a clear idea of the milestones and deliverables so they can track the progress. 

3. Channelizing Stakeholder Communication

Seamless communication is essential for the success of a project. By offering a clear direction about the purpose of a project, project managers can help them keep focused and channel their time and efforts toward achieving the project goal. It is also important to communicate the milestones to the team and update the leaders and management about the performance and progress. 

4. Manage Project Risks

Project management professionals should invest their efforts and time into analyzing the possible risks in the process. They should develop mitigation strategies and work out corrective measures to ensure that the end goal is achieved without hindrances.

5. Tracking the Progress Continuously

One of the main roles of leadership in project management is to track the project periodically and keep an eye on the progress of the project. This helps ensure that all the project stakeholders align with the project’s expectations and make changes if required.  

6. Maximize Resource Utilization

Every project has limited resources such as human resources, budget, and time. Promoting optimal resource utilization is a key role of leadership in project management. Doing so helps enhance the productivity of the project team and minimize wastage. 

Importance of Leadership in Project Management

The role of leadership in project management is crucial as it involves managing the end-to-end activities of a project, from planning and monitoring the project scope to establishing coordination, solving challenges, and making important decisions. 

The following are some factors that reveal the importance of the role of leadership in project management. 

Importance of Leadership in Project Management

1. Interpersonal Skills for a Productive Workplace

Beyond technical expertise, project managers must possess excellent interpersonal skills to drive the team toward the collective vision. As project managers invest a major chunk of their time in communicating with stakeholders, interpersonal skills are crucial. 

Project managers must be able to speak, listen, and question the stakeholders whenever needed. They should know how to resolve conflicts and reach agreements to motivate and respect everyone on the team. Project managers should strive to promote a harmonious, dynamic working environment. 

2. Instill Positivity and Enthusiasm in the Team

Successful managers approach problems with positivity and always have an optimistic attitude. They should understand that problems and challenges are common. The project leader should approach them with an attitude of figuring out solutions rather than dwelling on the problem. 

3. Honesty and Integrity

Integrity is an essential virtue when it comes to project management. Project managers should set policies and guidelines and ensure transparency in the process. This helps them build trust in the minds of the clients, team members, partners, management, etc.

4. Enhance the Team’s Potential

Active project lead managers invest their efforts into understanding the strengths of each team member and work out ways to build over their strengths. As the employees feel heard and respected, they tend to demonstrate greater commitment to the project goals, which in turn enhances the team’s potential. 

5. Decision-Making

The decisions made by the project managers produce a direct effect on the project outcomes. So, they should be able to make informed decisions by exploring all possibilities and choosing the one that works the best when it comes to achieving the project goals. 

Leadership Styles in Project Management

Leadership isn’t a one-size-fits-all strategy. There exists no common style that goes well with all personalities and teams. There are several different types of leadership styles in project management, some of which are given below. 

  • Transactional
  • Interactional
  • Laissez Faire
  • Transformational
  • Charismatic
  • Servant Leader

Different leadership styles in project management

1. Transactional Leadership Style

The transactional leadership style focuses on setting goals for the team and achieving them through rewards and incentives. Transactional leaders set clear, concise goals regarding timelines, scope, deadlines, etc.  They endeavor to build a structured environment where everyone in the team is aware of their roles and responsibilities, and the team knows what is expected of them. 

Transactional project lead managers tend to follow a standard and have less room for innovation. They correct the team members and put them back on track if they deviate from the intended goals. So, this style is inappropriate for projects that demand creativity and innovation. Transaction leadership style works well with short-term projects that have explicit goals and short deadlines. 

2. Interactional Leadership Style

The interactional leadership style is relatively dynamic, where the leaders make decisions based on the situation and the project’s demands.

They consider various factors like work environment, market requirements, organizational culture, evolving market trends, etc., when it comes to project management and decision-making. 

Interactional leaders are flexible and promote open dialogues and collaboration in the team. 

3. Laissez-Faire Leadership Style

In the Laissez Faire style, the project management leaders show minimal involvement in guiding the teams, and they let the team members determine the goals, define the scope, and come up with implementation ideas. This works well in projects that require creativity and innovation. The leaders have an open mind to listen to ideas from the team members and learn from them. 

4. Transformational Leadership Style

In the transformational leadership style, leaders shed their focus on motivating the team members to unleash their fullest potential to be able to achieve the project goals and, eventually, the business vision. 

They encourage innovation and creativity and motivate the team members to work in a collaborative environment.   

5. Charismatic Leadership Style

As the name suggests, charismatic project lead managers leverage their personalities and charisma to motivate the team members. They are extremely confident in their abilities and project management skills, and their excitement, energy, and passion for work are infectious. Building a positive relationship with the team members drives the team towards the intended objectives and success. 

6. Servant Leadership Style

In the Servant leadership approach, the project leaders aim to serve the teams and achieve the objectives by empowering them rather than exerting control over their activities. This way, the employees feel heard, appreciated, and respected, so they give their fullest to achieve the project objectives. 

6 Ideas to Strengthen as a Project Leader

We have curated some important ideas and tips to achieve success in the project leader role to navigate the team toward achieving the intended goals. Besides, you should observe successful project leaders in your arena and understand their work from different dimensions. 

How to achieve success as a project manager?

You should also try to engage with other project leaders and have an open mind to learn from them. In the following section, we have curated six ideas that we think might help you groom yourself as a successful project leader. 

1. Achieve the Balance

Project leadership and management are more about understanding the gap and maintaining the balance between leading project teams and leveraging their skills to achieve the end goals. It is about figuring out the leadership style that works best for the scope, timeline, and skills required to achieve the outcome of a particular project. 

2.  Focus More on the Team than on the Project

A key challenge of project leaders isn’t project planning or execution but promoting team development and collaboration among them. When you build the right team and develop a positive culture, they automatically tend to push the project toward successful completion. 

3. Lead by Example

Successful project managers lead by example. They shoulder the responsibility for their actions and own the project outcomes. They follow the behavior, quality, and approach they expect in their team so the team members can draw inspiration from them. 

4. Connect and Collaborate Rather than Communicating

Successful project leaders go beyond communicating the project goals, seeking status updates, and tracking the progress. They foster a deeper connection with the team members and explore ways to collaborate. Such leaders tend to understand the aspirations and interests of the team members, even if they extend beyond the fringes of work and profession.  

5. Continuous Improvement is the Key

The role of leadership in project management is constantly evolving. As a project leader, you must stay up-to-date with the latest tools and technologies. This helps you stay ahead of the curve and leverage the tools to enhance the productivity of your business functioning. 

6. Empower your Team with Decision-Making Abilities

In the digital world, project management works on agile and lean methodologies. Decision-making has become decentralized, so it is important to empower team members with decision-making skills and critical thinking abilities

It is important to reflect and teach the team about basing their decisions on data and insights rather than bias, judgments, and preconceived notions. 

Top 6 Leadership Theories You Should Know

‘What makes a great leader?’ has always sparked interest and curiosity among scholars and researchers. So, leadership theories are synthesized around how individuals become leaders and what sets them apart.  Leadership theories date back to the 1800s and have constantly evolved since then.

Following are the top 6 leadership theories that you must know to develop an understanding of what makes a great leader. 

Leadership Theories You Should Know

1. Transformational Theory

The transformational leadership theory emphasizes that leaders achieve objectives and goals by influencing the team through inspiration and motivation. They lead by example, and their vision motivates the team members to pursue their paths. 

Transformational theory

The influence of the team leader motivates the team members to invest completely in doing what it takes to achieve the ultimate goals. They prioritize communication and collaboration in the team and have a proactive work style. They show greater involvement in the project rather than staying at the top and offering directions and instructions. 

2. Leader-Member Exchange (LMX) Theory

The LMX theory is based on the relationship between the leader and the followers or team members. Among the followers, the theory identifies two groups, the in-group and the out-group. The association of a leader with the team members is based on these groups.

Leader-Member Exchange (LMX) theory

Project managers have a closer, collaborative relationship with the in-group members. They tend to favor the in-group members and add more responsibility to their carts. The in-group members gain access to more information and more opportunities for their growth. 

On the other hand, out-group members share a very formal relationship with the project leaders. They tend to assign mundane, repetitive tasks to the out-group members. 

3. Adaptive Leadership Theory

Adaptive leadership emphasizes that leaders must have the ability to adapt to evolving circumstances and explore ways to navigate challenges. The theory suggests that leaders must be prepared to face uncertain situations and take calculated risks to arrive at a solution.

Adaptive leadership theory

The key focus of this theory is how leaders thrive in challenging, uncertain scenarios. Such leaders focus on forging an environment where team members find it comfortable to share their opinions and demonstrate a willingness to take challenges head-on. 

4. Strengths-based Approach 

The strengths-based theory emphasizes that the individual strengths of leaders determine their style of leadership and, eventually, their success. They leverage their strengths, skills, and competencies to ensure seamless completion of the projects. 

What is project leadership?

By assessing their strengths and building over them, leaders tend to maximize the productivity of the team and drive them to success. This requires a complete shift in the mindset to develop a focus on strengths rather than weaknesses. By doing so, they also influence the team members to build on their unique strengths and skills and explore ways to leverage the strengths to drive project outcomes. 

5. Servant Leadership Theory

The servant leadership theory was propagated by Robert K. Greenleaf, the founder of the modern Servant leadership movement and the Greenleaf Center for Servant Leadership. It emphasizes that leaders should focus on prioritizing the interest of others over their self-interest.

The theory identifies three kinds of leadership approaches when it comes to leading project teams. 

i. Bureaucratic or Transactional Leadership 

In this approach, leaders exercise strict controls and discipline and practice adherence to rules, policies, and procedures. Such leaders are rigid and task-oriented. 

ii. Traditional or Feudal Leadership

In the traditional or feudal approach, absolute authority vests with the leaders, and the employees are expected to follow them without any questions. Such leaders believe in faithfulness and loyalty and adopt the traditional style of governance. 

iii. Charismatic or Transfomer Leadership

Here, the leaders influence the followers through charisma and personality and inspire the team to believe in their vision. They are persuasive, engaging, and dynamic when it comes to leading project teams. 

6. Transactional Leadership Theory

The transactional leadership theory evolved in the 15th century following the industrial revolution. In this approach, the leaders position themselves at higher levels of importance. They exercise authority to systemize the project management process and create rules and policies to motivate the team to achieve the objectives. 

Transactional leaders focus on the immediate, short-term objectives of the project. They do not value innovation and creativity and prefer to work by following systemic procedures and set standards. 

How to Lead by Example?

Leading by example is the easiest way to encourage and motivate your team toward achieving the project objectives. Following are some strategies you can adopt to lead your team by example. 

How to lead by example?

  • How project leaders solve problems sets an example for the team members to approach challenges. Project management and execution can be challenging at times. Staying positive and motivated to figure out the solution helps rather than dwelling on the problems. 
  • Today’s project management landscape is decentralized, so accountability is critical. Make yourself accountable for the outcomes, so your team members can draw inspiration from you. This way, they learn to take ownership of the project outcomes
  • Have an open mind to listen to your team and learn from them. Though it is important to direct your team, listening encourages creativity in the team. The team members feel appreciated and respected in the organization and tend to reciprocate the same approach.
  • Though the primary role of leadership in project management is to direct the team, getting involved in the process helps build trust among the employees as well as helps solve their challenges quickly.

The Must-Have Skills That Every Project Manager Needs

The scope of project management is constantly evolving, and so are the skills and expertise needed to thrive in the business landscape. We have covered the crucial skills every project manager must have to lead the teams and steer them toward project goals and organizational vision. 

Must-have skills for project lead managers

1. Effective Communication

From kick-off to tracking and delivering the outcomes, project managers must communicate effectively with the stakeholders involved in the project. Cesar Abeid, a popular host of Project Management for the Masses podcasts, shows that project managers spend around 90% of their time on communication

Lack of effective communication adversely affects the quality of outcomes and timely delivery. A successful Project manager conveys the information, reports, project objectives, organizational vision, etc., to all the stakeholders in an effective manner. 

2. Negotiation

Negotiation skills are a must-have for project managers as they engage closely with all the stakeholders, from suppliers and teams to clients. An effective project leader manages resource allocation, engages with suppliers, and resolves team conflicts to ensure all stakeholders are in sync with the project goals. 

3. Planning and Scheduling

Planning is a core activity for project management professionals. The project manager should have the ability to set clear objectives, determine the sequence of activities, plan resource allocation, set timelines, and track progress. Having a well-thought-out increases the odds of success of a project. 

With digital transformation gaining prominence, several project management tools have evolved to simplify the process of planning and follow-up. Project managers must learn to harness the potential of those tools to improve the efficiency of the planning process. 

4. Risk Management and Mitigation

Project managers must have the ability to identify and anticipate risks in the process and work out strategies to mitigate them. As risks are uncertain and unforeseen, project managers often ignore them, impacting the pace of project success. They must understand and acknowledge the risks probable in the process and plan ways to avoid them. 

5. Efficient Team Management 

Marshaling a team and navigating them toward the expected outcomes and goals is the key role of leadership in project management. The project manager should have the ability to delegate tasks, resolve conflicts, evaluate the performance of team members, and motivate them to take feedback and demonstrate progress. 

The project managers should lead by example, shoulder accountability for the outcomes, and be responsible for their actions. They should set clear goals and offer direction, support, and guidance to achieve the project objectives. 

6. Problem-Solving Skills

Given the complexities of projects in today’s world, critical thinking and problem-solving skills help project managers achieve successful outcomes. In challenging times, they must remain proactive rather than reactive to be able to figure out a solution. 

Project managers should have the skills to identify and comprehend problems quicker and find ways to solve them. They should approach problems with an open mind and develop innovative solutions. 

7. Budget Management Skills 

Project managers must have the acumen and competencies to comprehend the nuances of budget management and financial analysis. They should maintain the budgetary plan, record direct and indirect costs, track expenses, and explore opportunities to minimize expenditures. Project managers should work out efficient resource allocation strategies and ensure that the project outcomes are achieved within the estimated financials. 

8. Reporting and Analytics

Project managers must be able to prepare reports that help communicate effectively with the team and evaluate their progress and performance. This helps establish coordination with the team, vendors, clients, and other stakeholders involved in the project and helps identify areas for improvement.  

Successful project managers leverage various tools to present information in an easy-to-perceive format like charts, graphs, etc.   


Project management requires effective collaboration between multiple stakeholders and interdisciplinary teams. The risks and uncertainties involved add to the complexity of the role of leadership in project management. By using project management software, tools, and modern methodologies project managers can plan the process more effectively, foster deeper collaboration, and ensure optimal allocation of resources. 

An efficient project management software helps automate repetitive operations to save time, resources, and costs. The project managers can invest their time into performing other crucial business operations. Such tools and methodologies enhance the team’s productivity and the business’s efficiency. 

Frequently Asked Questions

Leading by example is the best way for a project leader to motivate and inspire the team. The project manager should approach challenges and uncertainties in the process with an optimistic mind to figure out solutions. They should also be accountable for the outcomes and work hard to achieve the goals. This would inspire the team members to follow the leader and do all it takes to achieve the project outcomes.

When there is a conflict within the team, the project manager should do the following:

  1. Accept the fact that there is a conflict
  2. Invest efforts into understanding the views and perceptions of the team members
  3. Appreciate their points
  4. Work in collaboration to arrive at a solution
  5. Exercise authority and control in case there is a need

To deliver projects within the time frame and budget constraints, do the following:

  1. Understand the strengths and weaknesses of the team
  2. Define the scope of the project
  3. Determine the goals and communicate them to the stakeholders
  4. Set realistic timelines
  5. Evaluate the progress using collaboration tools
  6. Have contingency plans

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