It's All About Context
Right-click contextual menus were first introduced in Office 4.x (which included Word 6.0 and Excel 5.0) and went on to become a ubiquitous part of using software starting with Windows 95. The basic idea behind context menus was to give power users a more efficient way of executing commands. The concept of "object-oriented" design, both in programming languages and in user interface design were starting to hit their stride.
Back in the early days of context menus, however, we couldn't have paid real people to click on them. Had we given people an electric shock when they used the right-mouse button (ala Dr. Venkman at the beginning of Ghostbusters) context menus couldn't have performed any worse in the usability lab.
Then, over time, something interesting happened. More and more people would come into the labs versed in the language of right-click. Even people we considered "novice" users were regularly exercising the context menus. Today, more often than not, people try right-click almost before anything. Right-click, right-click, right-click.
Why has this revolution come about, and how does the new Office UI take advantage of it? It turns out the answer is only superficially rooted in efficiency and is, instead, all about context.
Let's say you insert a drawing of a circle into your Word document and now you want to put a border around it. A program like Word has well over a thousand discrete commands. Where do you start searching? The menus? The toolbars? If the toolbar you need isn't up, you need to view the full list of 30+ toolbars in the View.Toolbars dialog box. Maybe there's a Task Pane to do the formatting? Once you do start surfing the menus and toolbars, you'll see that more than half of the commands in the product are disabled. Your search is going to encompass hundreds and hundreds of commands.
Now, right-click on the circle. A menu of only 9 commands comes up... and every command is relevant to the circle. Simply by right-clicking, you've reduced the scope of your search from the entire product to just the tools relevant for a drawing. It turns out that people are not right-clicking primarily for efficiency gains; they're right-clicking because that's the best way they've found to get their work done. Unfortunately, with the exception of a few one-off commands like "Cut" or "Delete", context menus are often a series of links to dialog boxes in which you do the real work. So, you actually have to use a more inefficient and advanced UI (the dialog box) by choosing the context menu, but it's worth it because at least you found what you're looking for.
The Office "12" UI introduces a concept called "Contextual Tabs." The way it works is this: The default tabs for the application contain only the commands that are not object-specific. It turns out that this drastically simplifies the functionality you have to look through because so much of Word, for example, only works when you have a Table or a Chart or a Picture or a Header or a Drawing or a Text Box selected.
Whenever you insert or select an object, the Contextual Tabs for that object appear next to the main tabs in the Ribbon. It looks like this:
The Contextual Tabs contain all the features you need for working with the selected object. When you deselect the object, the contextual tabs go away because all of the commands would have otherwise been disabled. If you reselect the object, of course, the tools come back.
The result is this: the core product is drastically simplified. You don't have to scrounge through hundreds of disabled commands when you aren't working with an object. On the other hand, as soon as those tools are relevant (e.g. when you're working with a Table), they come into view. When they no longer could work, they're out of your way.
Contextual Tabs combine the discoverability advantages of context with the ease-of-use and efficiency of the Ribbon. Context Menus are great and are still a part of Office 12 (and are even being improved, as I'll discuss down the road), but we've taken advantage of what we've learned about the value of context and applied it to the core of the new interface.