How do you process the torrent of information that comes your way as an investment decision maker? On April 29, Gregg Groechel of Inferential Focus gave a presentation to CFA Society Minnesota that challenged the attendees to see their information gathering and decision processes in a new way.

The talk was titled, “Identifying Meaning Versus Noise: Getting Past Biases and Seeing What is Actually There.” We all can agree that is a lofty goal.

Groechel, a Twin Cities charterholder, led the group through a series of exercises to show how hard it can be to put things into context. He used photographs to illustrate how background and foreground information can be difficult to separate – and how meaning can be obscured.

A couple of key questions from him: “How do you set up an intentional way of operating? How do you open up the organization [to process information effectively]?”

The mission of Inferential Focus (website; Twitter feed) is to “make sense of a changing world” for its clients, which include investment firms of all types, corporations, and governmental organizations. Groechel walked through some of the firm’s principles and its process.

What does the firm do? The start of the process involves intensive, far-reaching, and unusual reading. Unusual in the sense that most of the reading is done from paper (because the processing of the information is better in that form) and the Inferential Focus team is designed to look for information in a very specific way.

The members of the team are all generalists, reading across disciplines and avoiding the specialization that characterizes research efforts in most organizations. In addition, they are looking to glean specific kinds of information from the materials that are read.

The firm believes that there is a hierarchy of information, with events most important and then facts. What aren’t very important are opinions and commentaries. Groechel deconstructed an Economist article to show that a very large part of was made up of that relative fluff, with very few events and facts referenced.

Think about the typical investment report or presentation. A high percentage of the content is made up of opinion and prognostication. The percentage is even higher in many of the stories in the financial media.

Inferential Focus ignores that and focuses on what is actually happening, piecing together developments from an array of sources to observe a context through which it can help its clients see economic, political, social, and technological changes. It then communicates the ideas in written materials and in-person meetings.

To provide an example, Groechel distributed to the attendees one of the firm’s “packets,” a collection of the source material that it uses to support its observations and its communications with clients. In this case, the readings concerned China, specifically a variety of hurdles being erected by China to impede the success of foreign consumer brands while simultaneously buttressing the competitive position of its domestic firms.

It was a good example, in that the information came from a variety of different publications, was focused on facts and events, and pertained to a variety of companies. In considering the prospects for firms in China, most observers are either focused on their own narrow specialty (and making predictions in that regard) or speculating on the level of Chinese GDP (and assessing the prospects for firms in relation to that). Each approach, according to Groechel, is missing the essential context: There is a general headwind to most foreign consumer brand companies doing business in China that wasn’t there before. On balance, that is likely to make results worse than will otherwise be expected.

As investment professionals, we are immersed in information and our greatest challenge is in deploying our powers of observation in a differentiated and advantageous way to the benefit of our clients. Inferential Focus’ approach stands apart from that of most organizations, in that it is slower, more selective, more structured, and focused on identifying the big, important changes before others do.

Could it work for you? As Gregg Groechel said, this “consulting think tank looks at change through a different lens.” If nothing else, its divergent approach should make you think about how your own organization processes information and makes decisions.

Disclosure: I have known the Inferential Focus organization for thirty years. I have been a client and have also worked with the organization on some projects. Therefore, I have seen “the sausage being made” and have relationships with the principals of the firm. I have previously written about IF in a posting about a 1983 book that stemmed from its work (“The Tao Jones Averages,” long out of print but now available as an ebook) and in a piece that was inspired by an April 2013 IF report on applications of virtual reality that included a look at Oculus Rift, which was recently purchased by Facebook. (My essay focused on applications of the technology in the investment world.)