ENew Year comes with a lot of noise. Fireworks, countdown, chants of new beginnings. As business leaders and managers, we are expected to appear upbeat, uniting people around new goals and bold plans. I understand why. Optimism sells. It inspires. It makes people feel lighter after a long and difficult year. But after decades of working with organizations here and abroad, I've learned to be wary of this ritualistic optimism. There is another side to the New Year and ignoring it can prove costly.
I've always found it helpful to start the year not with big promises but with a cool list. What's broken? What is delicate? What can get worse before it gets better? This may sound pessimistic, but it is actually an act of responsibility. Leaders who only talk about hope risk distancing their teams from real obstacles. In business, hope without realism quickly turns to disappointment.
Globally, the mood is far from normal. Inflation may be decreasing in some markets, yet costs remain stable. Supply chains are still exposed to conflict, climate shocks and politics. Technology is advancing rapidly, especially with AI, but the adoption gap is widening. Some companies are in a race to move ahead, while many are quietly struggling to stay ahead. This inequality matters. When leaders proclaim that the new year will be a breakout year, they often forget that not everyone starts from the same line.
In the Philippines, the contrast is even starker. The growth figures look good on paper. Consumer spending has stalled. Yet talk to business owners, managers, or even government employees, and you'll hear a different story. Budgets are tight. Appointments are made carefully. Projects move slowly. Decisions are delayed because approval takes time, or because people are simply tired. I've seen teams enter January already exhausted, carrying unfinished work from the previous year, expected to behave as if everything had magically reset.
This is where realism becomes a leadership skill. The new calendar does not erase old problems. Backlogs never end. A resolution slide at a town hall does not lead to sudden improvements in weak systems. When leaders admit this openly, something interesting happens. People should rest. They feel seen. The pressure to perform optimistically is reduced and honest conversations begin.
What some might call healthy pessimism also has value. Not the type that complains endlessly, but the type that makes plans to make things go wrong. I often tell executives that pessimists create a buffer. They ask what happens if revenues decline, if a key person leaves, if a policy changes, if technology fails. Optimists assume smooth sailing. Pessimists design lifeboats. In uncertain times, lifeboats matter more than slogans.
In management, the year begins when goals are set. Stretch goals are fashionable. They look good on paper and board decks. But raising goals without clear trade-offs causes silent harm. Teams cut corners. Managers burn people out. Moral lines become blurred. When results fall short, the blame moves downwards. A more grounded approach asks harder questions. What can we realistically provide with the people and equipment we have? What should we stop doing to protect what's really important?
Leadership is not just about performance but also managing expectations. In the Philippines, we are culturally inclined to say yes to avoid disappointing others. This trend becomes even stronger at the beginning of the year, when everyone wants to appear cooperative and positive. Yet leaders who never say no in January often spend the rest of the year explaining away delays and failures. Realism in the beginning saves relationships later.
I've also noticed that personal New Year's habits spill over into organizations. Individuals promise to be more productive, healthier, more disciplined. By February, the guilt begins. Same thing happens in companies also. Big change programs are launched, only to be quietly halted. A leader who accepts that change is slow, uneven, and sometimes boring is better equipped to guide it. Progress measured in small steps may lack drama, but it persists.
This does not mean giving up hope. It means grounding hope in evidence. This means accepting that some years are about defense, not expansion. Some years are for fixing leaks, not for building towers. In my own work, there were years when survival and learning mattered more than growth. Those years were not failures. They were preparing.
As the new year approaches, I encourage leaders to balance optimism with clear-eyed decisions. Talk openly about risks as much as opportunities. Allow teams to express doubts without being negatively labeled. Reward honesty instead of cheerleading. In doing so, you build trust, and trust is a far stronger asset than motivational quotes.
The New Year does not owe us success. It provides time. What we do with that time depends on how honestly we see the path ahead. Realism may not sound inspiring, but in the long run, it is what keeps organizations standing when the initial excitement fades.
The views expressed here are his own and do not necessarily reflect the opinions ofFICE as well as FINEX.
Reynaldo C. Lugtu, Jr. is the Founder and CEO of Hungry Workhorse, a digital, culture and customer experience transformation consulting firm. He is a fellow at the US-based Institute for Digital Transformation. He teaches Strategic Management and Digital Transformation in the MBA program at De La Salle University.
ray.lugtu@hungryworkhorse.com