Optimism is in the air. Conversations with several global chief executives, including Unilever's, 3M's, Volkswagen's and Saatchi & Saatchi's, revealed a clear feeling that times are improving. They all used the word "optimism".
Regionally, there seems to be a feeling of optimism as well.
Leaders from diverse industries, including hospitality, oil and gas, retail and manufacturing, are articulating a good feeling about the year. But they also couple "optimism" with "cautious". Nonetheless, the mood is a break from last year, when many were only hopeful.
A certain psychology comes with the change of a year, and this time is no different. One leader shared: "We arrested the dive following the global financial crisis, and in 2011 started the climb back up. Now, in 2012, we are positioned again for growth. We have re-earned the right to grow."
But with the excitement of optimism comes the risk of foolish action, especially given the pent-up passion to grow after the paralysis in the markets from 2009 through last year. The temptation is to revert to the way business was prior to 2009. However, this is a different market and requires different actions.
Here are some considerations when trying to capitalise on the optimism.
It is the time for opportunity
Growth mode is in full swing and businesses across the region are eyeing aggressive expansion. So it is time to set targets for market share and operating margins. But as you switch to growth mode, do not lose all of the frugality of the recession. If you can maintain this in the midst of expansion, you will be well positioned for sustained growth.
Employees are the real asset
Perhaps the most overlooked category in the boardrooms of the region from the past decade is employees. Yet leaders spend the most time worrying about employee matters - performance, retention, engagement and remuneration. Commit to following up your concerns with action. Become a people leader, and make talent your priority.
Be cautious with raises
With growth will come the temptation to participate in the compensation and benefit game that prevailed before the crisis. It resulted in pay inflation. If you thought the property bubble was damaging, wait until you see what comes from pay inflation.
Practise makes perfect
If you want your employees to improve their performance, and stay with you longer, you have to create an environment where they can improve their skills and behaviours. Development is a practice. It is necessary for employees and leaders to step out of their day-to-day activities in the business to focus on getting better.
When leaders become optimistic, they typically venture down one of two paths. The first is a reaction to the market dynamics and an obsession to rush and make up for lost time. The other path recognises the optimism as a new start and an opportunity for sustained growth by acting strategically.
Tommy Weir is an authority on fast-growth and emerging-market leadership, the author of The CEO Shift and the managing director of the Emerging Market Leadership Center
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