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Key Takeaways
- Before telling a team what to do, leaders have to understand the environment themselves.
- Leaders often overlook the broader context surrounding their plan — and how that context ultimately shapes the outcome.
During the early months of COVID, I was leading a retail product business that suddenly found itself in the same position as thousands of others. Stores were closed, yet lease payments kept coming, and revenue had effectively gone to zero.
Like most companies, we pushed aggressively into ecommerce. It was the right move, but while everyone was talking about the shift to digital, I kept coming back to a different thought.
With prices dramatically down, it was the best time in the world to sign retail leases and the need for human interaction would certainly come after the crisis.
When we stepped back and looked at the broader context of the market, it became clear that there was an opportunity in front of us. So we did something that seemed counterintuitive at the time. We signed leases.
Those deals became some of the most valuable locations the company would secure for years to come. The business outcome wasn’t luck. It was context.
Most leadership frameworks focus on role clarity and goal setting. Leaders are encouraged to define responsibilities, establish metrics, and align teams around outcomes. These practices matter, as they bring structure and accountability to an organization.
However, even when roles are clearly defined and goals are well understood, leaders still make avoidable mistakes. The most common reason is that they overlook a critical variable, which is context.
Context is the environment that determines whether your plan actually works. It includes internal dynamics like team capability and organizational structure, but also external forces like market timing, customer behavior, and economic conditions. When leaders ignore context, they often execute perfectly against the wrong assumptions, and that mistake is surprisingly common.
According to McKinsey, fewer than 30% of digital and business transformations fully succeed, which means the majority fail to deliver the outcomes leaders originally set out to achieve.
When leaders take the time to assess the environment around a goal, they improve the quality of their judgment and reduce the risk of sending teams in the wrong direction. Here are three things every leader should understand about context before directing a team toward a business outcome.
Before leading anyone else, understand the terrain
One of the quiet traps of leadership is assuming that once a goal is defined, the work is simply driving execution. In reality, a leader’s first job is understanding the terrain the team is operating within.
When leaders skip this step, they often push teams into action before they fully understand the constraints around them. The market looks stable when it isn’t. Internal alignment appears stronger than it really is. And leaders move forward believing customers value something they actually don’t.
The data backs this up. Deloitte’s 2024 Global Human Capital Trends report found that many organizations struggle with effective decision-making because leaders lack clear visibility across their organization and the broader business environment.
That gap between perception and reality creates friction across the organization. Teams execute against goals that were set under outdated assumptions.
The takeaway is simple. Before telling a team what to do, leaders have to understand the environment themselves. Otherwise, they’re just issuing instructions inside a fog.
Ignore macro trends and your strategy will age overnight
Even strong leaders often underestimate how quickly external conditions can invalidate a strategy. Markets shift. Consumer behavior changes. Technology reshapes entire industries. Yet many organizations continue executing plans long after the conditions that justified them have disappeared.
That was exactly what made the COVID moment so unusual. While much of the retail world was abandoning physical stores entirely, the underlying market conditions were quietly shifting in the opposite direction. Lease prices were falling, landlords were under pressure, and the opportunity to secure strong locations at a discount was suddenly everywhere.
Consider how quickly macro forces can alter business outcomes. The International Monetary Fund’s 2025 World Economic Outlook highlights how shifts in inflation, interest rates, and supply chain dynamics continue to reshape global economic conditions and business costs across industries.
That kind of volatility means strategy cannot be static. The leaders who navigate turbulence best are constantly reassessing the context in which their businesses operate. They watch competitors, economic signals, customer sentiment, and technological shifts. They’re not just asking whether the team is hitting the goal. They’re asking whether the goal still makes sense.
Google won’t give you the full picture
Another challenge with context is that it rarely comes from a single source. Data, reports and research help, but some of the most important signals leaders need don’t show up in a spreadsheet.
The most effective leaders I’ve worked with consistently seek perspectives outside their immediate organization. They talk to operators in adjacent industries, ask customers uncomfortable questions and seek out advisors who have navigated similar challenges before.
In fact, in PwC’s June 2025 Pulse Survey of CEOs, 58% said they’re changing how they make decisions by talking to other executives and encouraging more internal debate as they navigate uncertainty. Half said they’re also bringing in external advisors to challenge their thinking.
Harvard Business Review notes that organizations that bring in outside expertise often improve strategic decision-making by challenging internal assumptions and expanding leaders’ understanding of the environment they are operating in. If you only look inward or rely on surface-level research, you miss the signals that actually shape the market.
When I think back to that moment during COVID, the real takeaway wasn’t about retail leases, it was about how leaders interpret the world around them. Role clarity and the execution of plans to hit a specific goal matter, but they don’t exist in isolation.
The best leaders I’ve seen first zoom out to understand the environment that’s impacting them. Because in business, the difference between a bad strategy and a brilliant one is often the same plan executed in a different context. And the leader’s real job isn’t just setting direction, it’s making sure the map still matches the terrain.
Key Takeaways
- Before telling a team what to do, leaders have to understand the environment themselves.
- Leaders often overlook the broader context surrounding their plan — and how that context ultimately shapes the outcome.
During the early months of COVID, I was leading a retail product business that suddenly found itself in the same position as thousands of others. Stores were closed, yet lease payments kept coming, and revenue had effectively gone to zero.
Like most companies, we pushed aggressively into ecommerce. It was the right move, but while everyone was talking about the shift to digital, I kept coming back to a different thought.
With prices dramatically down, it was the best time in the world to sign retail leases and the need for human interaction would certainly come after the crisis.
When we stepped back and looked at the broader context of the market, it became clear that there was an opportunity in front of us. So we did something that seemed counterintuitive at the time. We signed leases.
