A sober look at the New Year

Every new year arrives with noise. Fireworks, countdowns, slogans about fresh starts. As business leaders and managers, we are expected to sound upbeat, to rally people around new goals and bold plans. I understand why. Optimism sells. It motivates. It makes people feel lighter after a long and difficult year. But after decades of working with organizations, both here and abroad, I have learned to be cautious of this ritualized optimism. The new year also has a flip side, and ignoring it can be costly.

I have always found it useful to begin the year not with grand promises but with a quiet inventory. What is broken? What is fragile? What might 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 blinding their teams to real constraints. In business, hope without realism quickly turns into frustration.

Globally, the mood is far from simple. Inflation may be easing in some markets, yet costs remain stubborn. Supply chains are still exposed to conflict, climate shocks, and politics. Technology continues to move fast, especially with AI, but adoption gaps are widening. Some firms are racing ahead, while many are quietly struggling to keep up. This unevenness matters. When leaders declare 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 sharper. On paper, growth numbers look decent. Consumer spending is holding up. Yet talk to business owners, managers, or even government staff, and you hear a different story. Budgets are tight. Hiring is cautious. Projects move slowly. Decisions are delayed because approvals take time, or because people are simply exhausted. I have seen teams enter January already tired, carrying unfinished work from the previous year, expected to act as if everything has magically reset.

This is where realism becomes a leadership skill. A new calendar does not erase old problems. Backlogs do not disappear. Weak systems do not suddenly improve because of a resolution slide in a town hall. When leaders acknowledge this openly, something interesting happens. People relax. They feel seen. The pressure to perform optimism fades, and honest conversations begin.

There is also value in what some might call healthy pessimism. Not the kind that complains endlessly, but the kind that plans for things to go wrong. I often tell executives that pessimists build buffers. They ask what happens if revenues fall short, if a key person leaves, if a policy shifts, if technology fails. Optimists assume smooth sailing. Pessimists design lifeboats. In uncertain times, lifeboats matter more than slogans.

In management, the start of the year is when targets are set. Stretch goals are fashionable. They look good on paper and in board decks. But stretch goals without clear trade-offs create silent damage. Teams cut corners. Managers burn people out. Ethical lines blur. When results fall short, blame travels downward. A more grounded approach asks harder questions. What can we realistically deliver with the people and tools we have? What should we stop doing to protect what truly matters?

Leadership also means managing expectations, not just performance. In the Philippines, we are culturally inclined to say yes, to avoid disappointing others. This tendency becomes stronger at the start of the year, when everyone wants to sound cooperative and positive. Yet leaders who never say no in January often spend the rest of the year explaining delays and failures. Realism early on saves relationships later.

I have also noticed that personal new year habits spill into organizations. Individuals promise to be more productive, healthier, more disciplined. By February, guilt sets in. The same happens in companies. Big transformation programs are launched, only to stall quietly. 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 lasts.

None of this means abandoning hope. It means grounding hope in evidence. It means admitting that some years are about defense, not expansion. Some years are about fixing leaks, not building towers. In my own work, there were years when survival and learning mattered more than growth. Those years were not failures. They were preparation.

As the new year unfolds, I encourage leaders to balance optimism with clear-eyed judgment. Speak about risks as openly as opportunities. Allow teams to express doubt without being labeled negative. Reward honesty over 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 offers time. What we do with that time depends on how honestly we see the road 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 herein are his own and do not necessarily reflect the opinion of his 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 of De La Salle University.

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