2040’s Ideas and Innovations Newsletter, Issue 34: Context is Everything

Photo Credit: Sandra Rodriguez

Context Is Truly Everything

We have shared with you a set of practices that is key to high performance, optimal business modeling, productive workplace culture and enlightened leadership. Clear, unbiased communications and organizational constructs are essential tools in a digital marketplace. And activating these tools is made more powerful through critical thinking and analysis with context.

We are among those that believe that context is everything. It is the foundational pillar of any change and transformation. Without contextual analysis, transformation is merely theoretical. And without shared knowledge that results in shared organizational understanding and alignment, the exercise is meaningless.

Context is critical to prevent overlooking systems within systems and the impact our actions may have across systems when we consider organizational change and transformation. When we consider context, we must take into account how historical, social, societal, cultural, generational, political, and environmental factors impact and influence organizational change or transformation efforts. More precisely, a context-informed transformation strategy includes the market environment, organizational structure, technological infrastructure, human complement, and other elements that comprise a complete system dependent upon its interrelationship with immediate internal and broader external systems.

What are these broader systems? There are three interrelated systems that when combined provide the necessary context to operate a relevant business. Each system has a viewpoint that can be both harmonic and conflicting.

  • The macrosystem is defined as the larger environment that the organization exists in and represents the world, the society, the economy and/or the country and continent(s) the organization serves.
  • The mesosystem is defined as the organization and its organizational system comprised of its strategies, purpose, structure, workforce, operations, and the services and/or products it provides.
  • The microsystem is defined as the individuals and individual groups representative of the workforce, partners, customers, and prospective customers. Within the microsystem exists family structures as well as local/extended communities.

The three systems connect or diverge depending on the context of variables or factors. Context is complex because it is fluid and relates to each organization in specific ways with selected knowledge, data and information points that feed into constructing strategies and tactics of change or transformation.

What is Contextual Analysis?

Contextual analysis and creating a culture built on shared knowledge create an objective foundation for decision making. And in today’s highly charged public and business discourses, making decisions that are based on objective criteria, not highly subjective, siloed, and biased opinions, will provide the competitive edge you need to be relevant and meaningful to all stakeholders — including your customers and employees.

With contextual analysis, organizations can examine relevant factors and variables that determine roadblocks and impediments as well as possibilities and opportunities for action. The contextual analysis first understands external trends and market changes that impact the organization. Then these factors are defined as variables and interpreted in the context of the organization in terms of their influence and impact on transformation or change.Technically speaking, contextual analysis is the systematic analysis — identification, sorting, organization, interpretation, consolidation, and communication — of data gathered in an inquiry for the purpose of understanding the factors and variables across the macro (world, country, region or locality), meso (organization) and micro (representing individuals and groups of stakeholders (customers, employees, etc.).

Here’s a real-life example of contextual analysis based on the growth and changes in our world population. In truth, we may have the professional bias and perception that the population will continue to grow and therefore, there will always be new customers to acquire or new employees to hire. However, what is important to understand is where that population is or isn’t growing. Then you need to determine if your customers are trending older and no longer aligned to your target market. We know birth rates around the world are in decline in developed countries while data shows that an estimated 2.5 million Alphas are born globally every week. Understanding in detail where stagnation is occurring and where growth is predicted is important. If we don’t take the time to acquire, assimilate, and analyze data points, we may find ourselves drawing a conclusion that isn’t based in reality.

We have short listed what we believe are the most important items that comprise contextual analysis and can lead to objectively understanding the factors and variables that represent what an organization needs to know which can lead to informed shared knowledge. These factors are critical for transformation in today’s digital marketplace.

  1. The macro trends: This is the environmental context in which the organization exists.
  2. The micro trends: How are individuals and groups, which encompass stakeholders in your market, changing (values, perceptions, expectations and preferences)?
  3. Market opportunity: Can growth occur with existing value? Is that growth sustainable? Who are the competitors, and can you compete?
  4. Value and Shared Purpose: What are the unique value propositions of your products and services. Is the organizational structure and culture aligned to a shared purpose focused on growing the value proposition and maintaining orientation to the market?
  5. Technology Trends: The major innovations, shifts and opportunities that enable transformation and change that accords to the “market” and environment.
  6. Capabilities: What orientation and organizational capabilities exist and what are the gaps? Is your workforce motivated to align to a market orientation and a shared purpose?
  7. Knowledge: Is it shared throughout the organization or in silos and therefore inaccessible to everyone? Is the organization and its culture working from the same set of shared knowledge and the understanding it begets?

These seven factors, which are deeper than we briefly summarized, are foundational to transformation and require rigorous critical thinking and inquiry within the context of the environment, market, and the workforce. Without contextual analysis, transformation is merely academic and theoretical and without shared knowledge, the exercise is doomed to fail.

Contextual Analysis and the Human Factor

It’s one thing to build a strategy for change and anticipate what your stakeholders expect from you. It’s totally another proposition to bring your teams along to make change and alignment to a shared purpose based on contextual analysis a reality.

At 2040 we work with our clients to give them the tools to anticipate resistance, systematically implement change management strategies, and work with teams to set up the need for change, include them in the process and reward them for innovations and successes in the transformation journey. As we have surfaced time and again, managing individual and culture transitions as part of the process is paramount — and contextual analysis and shared knowledge becomes its basis.

Shared Knowledge

Shared knowledge is the glue that holds any enterprise together. Without information and knowledge exchange, organizations operate in a silo model that, by design, keeps people, their expertise and knowledge apart. As we consider the path that contextual analysis unlocks across the market and the world, institutional knowledge and legacy perceptions run in contrast to desired outcomes. It takes discernment to understand where and how the human elements, biases and defaults can upend efforts to change and transformation. The impacts and influences our own personal defaults and biases play huge roles in choices, understanding, problem-solving and decision-making. Remember, they form the basis of how we see the world and play strongly in what we perceive.

There is a difference between shared and individual knowledge. Individual knowledge is gained through experience, practice and personal involvement and is strongly influenced by geographic and socioeconomic situations. It is impacted by daily life, faith, family, and more. It is by which an individual views, considers and reacts to life and those around them on a day-to-day basis.

There are two types of shared knowledge. The first type is correlated to shared interpretation. Interpersonal communication comprises the sender and receiver and how what is being shared and communicated and how it is received. Each individual is the sum of his or her parts; when individuals communicate with each other, often interpretation relies upon a small percentage of shared knowledge.

The second type of shared knowledge is a result of society’s efforts over time to constantly build and evolve knowledge across different subjects. For example, the field of science is constantly expanding with new knowledge contributed by individuals and groups. The expanding base of information and understanding collectively creates shared knowledge. This type of shared knowledge is generally accessible by individuals but is dependent upon an individual’s intent and desire to seek out the knowledge.

Individual and shared knowledge resides in our subconscious and consciousness and shapes our personal defaults, which can become our undoing. In the workplace, operating with faulty assumptions about our workforce and customers leads to peril. Use critical thinking and contextual analysis as tools to buffer our inherent faults.

Contextual Analysis and the Organizational Construct

Our perceptions, biases, and alignment to the past, as well as the strong desire to repeat past success compromise our forward movement and adaptions to a changing world and successfully changing and transforming. It is the human side of the equation that we often ignore in solving problems, creating new solutions, effecting change and in seeking to transform. Often, the planning, conception and implementation favor technology as a workaround to human behaviors. But we know that technology is no silver bullet that will overcome any challenge.

The organizational structure in the context of market environmental constants and business constructs reveal how each impacts decision making, separately and together. The typical defaults that impede change suppress the power and potential of an organization to move forward with transformation-based plans and initiatives.

We now exist in an environment where traditional systems thinking has been augmented by the practice of agile and agility. These disciplines represent essential tools to navigate the ambiguity and anxiety that is pervasive in running an organization in a digital age. Shared knowledge as an outcome of contextual analysis demands a holistic approach supported by systems thinking and an aligned organizational model to make any initiative successful.

At 2040 we advise our clients to resist the “fault in ourselves,” which is a personal bias-myopia that many leaders and managers share. Understanding how to communicate with genuine empathy and a sensitivity to the larger cultural conversation is a formula for success. You may think that contextual analysis sounds like a course in business school, but really it is the most basic and essential building block for change.

Think of your own organization. Are you enthusiastically plowing ahead to the future using tried and true tactics? Do you pause to apply critical thinking to your strategies and plans? Do you use contextual analysis to give real-world credibility and objectivity to your operations? And do you ensure that the outcomes of contextual analysis become the basis of shared knowledge across the organization and leveraged to a shared purpose? These are the rules of the road to transformation. And we are here to help you.

Today, a successful organization must consider its operating principles from every angle. Contextual analysis is more than a safety net, it is the roadmap to maintaining a competitive edge.

Get in touch with us!

Read this issue and past issues on 2040’s website>

2040 helps organizations navigate the sea changes of finding their new normal. We offer actionable expertise in the strategy and operations of digital growth and engagement, empowering an empathetic workplace culture, strengthening your value proposition and driving revenues. We’ve been in your shoes and we know what impedes transformation … and what unlocks it.

Onward and upward from the 2040 Team

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