Good leaders are optimists who believe there’s always a solution to every problem. They’re “glass half full” individuals who bring positive perspectives to the business challenges facing them and their teams. But it is possible to overuse and misuse optimism. If you’re always painting a Pollyanna picture when problems clearly need to be acknowledged and addressed, you’ll erode credibility, stifle communication, and undermine your best intentions. Worse, those around you might question your sanity or grasp of reality. To enhance and ensure your leadership effectiveness, you’ve got to remove those “rose-colored glasses” at times. Remain grounded in what you do and say, striking that balance between what’s optimistic and realistic.

We’ve all worked with someone who never seems to think the company has “problems.” But no organization is perfect, and not recognizing the issues and addressing them effectively can create huge problems for a company and its people. Here’s a solid three-step strategy for achieving that balance between what’s optimistic and realistic.

1. Talk about what is working. Since it’s highly unlikely that everything in your business is a disaster, determine what has been successful, focusing on your staff, the workplace culture, goals, tangible and intangible results, etc. Write down what’s right and communicate those in writing and verbally to your entire organization as well as to those directly impacted/responsible. Demonstrate not just the fact that a particular aspect of the company is working, but why it’s doing so well. For instance, “Our profits are up 5% since we implemented our new direct-to-consumer sales strategy led by Team 4 last quarter.”

2. Acknowledge the challenges. When problems surface or if your direct reports bring you “negative” information or complaints, don’t ignore or overlook these issues. Keep your head out of the sand, listen, take good notes, and embrace whatever’s at hand as an opportunity to learn, grow and improve. Within reason, share with your staff what you can, making it clear to others that you’re receptive to hearing about the challenges and aren’t afraid to admit that problems do exist. Keep an open door policy for discussing both the pros and the cons of the business to avoid creating or supporting a culture of fear.

3. Ask for feedback. You can’t solve your company’s problems alone — and that’s why you’ve hired and surrounded yourself with people of talent and skill! Tap those assets and encourage feedback when problems or issues arise, showing that you value their input and insight. Doing so builds employee engagement, fosters a solution-centric culture, and ignites energy and enthusiasm among all. Getting the input of others will also invariably keep your perspectives less personal and your understanding of the solutions more realistic. And this will more quickly provide the best answers and ultimately bolster the brightest and best leadership directions.

As a leader, how do you know if you’re being overly negative or positive?