From Fear to Curiosity: How to Transform Your Team into an Innovation Engine
Edward Kreiman
I Help SaaS & FinTech CTOs and Founders Scale from Seed to Series B | Build Products People Love, Modernize Legacy Systems, Fix M&A Tech & Deliver at Scale | Fortune 500 CTO | Strategic Growth Partner
TL;DR: Fear-based cultures kill innovation. Teams with psychological safety outperform others by up to 50% — three proven strategies to transform team culture and drive breakthrough results.
In a PE-backed SaaS company fresh off a $50M acquisition, the engineering team consistently delivered on-time releases and met their KPIs. Leadership had acquired top talent, implemented best practices, and streamlined operations. On paper, everything was working. Yet, something felt off. Despite flawless execution, competitors were shipping bold, market-defining features—while this company played it safe.
What leadership didn’t realize was that the post-merger culture had silently transformed: behind polished dashboards and risk-averse planning, no one dared to challenge the status quo. The company wasn’t failing—yet—but it also wasn’t generating the innovation premium investors expected from the acquisition
Sound familiar?
Fear-based cultures silently erode valuation multiples, not by failure, but by stagnation across PE and VC portfolios—whether in fintech, health-tech, or enterprise SaaS. Decisions get safer. Roadmaps get predictable. Big bets never make it past slide decks. The result?
?? 40% slower time-to-market for new features
?? Post-acquisition revenue synergies fall short by 35-60%
?? Key engineering talent churns at 2x the industry rate
The invisible tax of fear won’t show up on financial statements—until investors see it in flatlining ARR, compressed multiples, and a company that survives, but never dominates.
The Hidden Innovation Killer No One Talks About
Fear in professional environments rarely announces itself boldly. Instead, it manifests as:
? Over-cautious decision-making ("Let's not rock the boat")
? Minimal idea-sharing (Why risk looking foolish?)
? Rigid thinking ("This is how we've always done it")
"The most expensive words in business aren't 'we failed'—they're 'nobody felt safe enough to speak up.'"
This subtle force triggers what organizational psychologists call 'threat rigidity'—under pressure, even highly compensated technical leaders default to conservative choices. Instead of making bold, market-moving bets, they optimize for job security over breakthrough growth.
?? McKinsey found that this pattern intensifies most in the 18 months following a merger or capital injection—exactly when companies need to justify valuations and execute aggressive innovation strategies.
When risk aversion replaces risk-taking, the ROI investors expect never materializes.
At Playtech, where I led technology transformation post-acquisition, I inherited a team of brilliant engineers who played it safe. No one wanted to challenge the status quo,?and risk-taking felt dangerous, so ideas stayed locked in notebooks instead of making it to production.
?? The result? A creeping accumulation of technical debt, bottlenecked decision-making, and an innovation pipeline that slowed to a crawl. On paper, everything looked stable—until the cracks widened, and we found ourselves losing ground to faster-moving competitors.
?? Key Insight: According to Harvard Business School research, psychological safety—the absence of interpersonal fear—is the single strongest predictor of team effectiveness across industries. Teams where members feel safe to take risks consistently outperform their cautious counterparts by 30-50%.
??? Three Powerful Ways to Build a Fearless, High-Performance Team
1?? Signal Safety Through Vulnerability
At Amazon, I saw firsthand how leadership vulnerability reshaped team culture. I once watched a senior exec openly admit, ‘I pushed for the wrong feature—it cost us months of development time, and here’s what I learned.’ Instead of backlash, the room leaned in.
?? The impact? Engineers stopped playing it safe. They spoke up more. They took smarter risks. And innovation accelerated.
?? Action Step: Turn failure into a leadership tool—Institute "Failure Fridays" or "Lessons Learned" discussions where you go first.
I introduced this practice at a PE-backed fintech company. At first, there?was silence.?By the third session, leaders were sharing real mistakes, and teams followed.?Vulnerability wasn’t a?weakness—it became a competitive edge.
"Leaders who model vulnerability don't show weakness—they demonstrate the strength to learn."
2?? Reframe Questions to Unlock Hidden Insights
The questions we ask don’t just uncover answers—they shape how people think.
?? Ask, "Why did this fail?" → You get defensiveness.
?? Ask, "What can we learn from this?" → You get insight.
?? Action Step: Shift from blame to better solutions. Instead of focusing on fault, reframe discussions to focus on improvement:
? Instead of: "Who's responsible for this issue?"
? Try: "What systems led to this outcome?"
? Instead of: "Why wasn't this caught earlier?"
? Try: "How could we improve our detection process?"
? Instead of: "Why did you choose this approach?"
? Try: "What alternatives did you consider?"
At JPMorgan Chase, we noticed a recurring problem in our technical review meetings—engineers and analysts spent more time defending past decisions than exploring better solutions. Instead of fostering collaboration, discussions felt like interrogations.
So we made a simple shift: we reframed the conversation from ‘defending decisions’ to ‘exploring alternatives together.’
?? The impact?
? Engineers stopped feeling like they were on trial and started openly discussing trade-offs. ? Teams moved from playing defense to proactively improving designs. ? Meetings became more constructive, leading to higher-quality client-facing solutions. ? Team morale improved—people felt safe contributing ideas without fear of blame.
A slight shift in language didn’t just change conversations—it transformed company culture. And that’s where real innovation begins.
?? What’s one question you’ve reworded that led to a better discussion?
3?? Create Consequence-Free Zones for Experimentation
Innovation requires experimentation—but experimentation dies when teams fear immediate judgment. If every idea must prove its ROI upfront, significant breakthroughs never happen.
Google’s famous “20% time” recognized this principle, giving employees space to explore ideas beyond daily priorities. But you don’t need Google-sized resources to apply it.
Action Step: Implement monthly “curiosity sprints”—dedicated time where teams can test unconventional approaches without pressure to deliver immediate results.
? Encourages bold thinking without the fear of failure.
? Surfaces unexpected insights that improve core business strategies.
? Reinforces a culture of curiosity, where experimentation is a habit, not a risk.
Small shifts like this don’t just spark innovation—they make it a sustainable competitive advantage.
"Innovation happens at the intersection of psychological safety and purposeful experimentation."
Real-World Impact: Curiosity as Profit Driver
Success Story #1: Turning Psychological Safety into a 40% Cost Reduction
When SelfDecode, a fast-growing health-tech scale-up, needed to process genomic data 100x more efficiently, the default industry approach was to invest in specialized, high-cost infrastructure.
But instead of immediately following conventional wisdom, we created an environment where team members felt safe challenging assumptions and proposing unorthodox solutions. The result?
? A breakthrough internal approach that processed 80 million genetic markers per user ? 40% cost reduction—without sacrificing speed or accuracy ? A scalable solution that gave SelfDecode a lasting competitive advantage
Later, the engineer behind the breakthrough admitted:
"I wouldn’t have spoken up in my previous company—I didn’t think it was my place to challenge established approaches."
?? Key Insight: Innovation isn’t just about hiring the best people—it’s about creating a culture where they feel safe enough to think differently.
领英推荐
Success Story #2: Why This E-Commerce Brand’s Best Ideas Were Never Tried—Until One Simple Change
A mid-market e-commerce brand was stuck in a cycle of stagnant customer engagement and rising employee turnover.
The leadership team kept investing in better pricing, better products, and better marketing. But one thing never changed—the way teams approached innovation.
?? The problem? Employees weren’t launching new ideas because they weren’t sure they’d survive leadership scrutiny. If an experiment didn’t deliver instant ROI, it was shut down. Over time, teams stopped proposing bold CX changes and defaulted to what felt safest.
So leadership made one small but powerful shift: they introduced "learning loops"—structured spaces where teams could test customer experience innovations without fear of failure.
?? How it worked:
? Fast, low-risk experiments—Instead of waiting for full approval, teams could quickly test new personalization tactics, checkout optimizations, and loyalty offers.
? Data over gut instinct—Ideas weren’t judged before they were tested—only after.
? Failure became fuel—Every test, win or lose, was analyzed for insights, not blame.
?? The results?
?? A 32% increase in average order value (AOV)—driven by a new personalization engine born from these experiments.
?? A 41% improvement in employee retention—because teams felt valued and empowered.
?? A complete cultural shift—where innovation became a habit, not a risk.
?? Key Insight: When employees feel like they need permission to experiment, innovation stalls. But when companies build psychological safety into their processes, breakthroughs happen.
Measuring What Matters: Beyond Traditional Metrics
Cultural transformation can’t be managed if it isn’t measured. Yet, most organizations rely on traditional performance metrics—like output and efficiency—which unintentionally punish experimentation.
?? The problem? Innovation naturally involves trial and error, meaning teams that take risks might produce more initial “failures” before breakthrough results emerge. When failure is penalized, teams default to playing it safe.
?? Forward-thinking organizations track these four innovation metrics instead:
? Learning Velocity → How quickly do teams absorb new information and apply it? High-performing teams iterate fast and don’t repeat past mistakes.
? Innovation Attempts → How many new ideas were actually tested—regardless of success or failure? A high rate of experimentation means a culture that rewards curiosity.
? Psychological Safety Scores → Anonymous team surveys assessing how comfortable employees feel taking risks without fear of blame or repercussions. Harvard research shows that teams with high psychological safety outperform others by up to 50%.
? Question Diversity → How varied and insightful are the questions raised in planning meetings? A team that only asks “How do we hit this deadline?” instead of “What if we tried this differently?” is likely operating in a fear-based culture.
?? Key Insight: The fastest-growing companies don’t just measure performance—they measure bold thinking. If your organization isn’t tracking these metrics, you might not be measuring what actually drives long-term success.
"What you measure drives behavior. Measure learning, not just output, and you'll get more of both."
?? Proof? When we implemented these metrics at a private equity portfolio company undergoing digital transformation, the impact was undeniable.
Teams scoring highest on psychological safety delivered 3.7x more business impact over 18 months than teams optimizing for traditional delivery metrics alone.
The takeaway is clear: If you measure only execution, you get efficiency. If you measure innovation, you get competitive advantage.
Your Role as Catalyst: Small Signals, Big Impact
Transforming fear into curiosity starts at the top. As a leader, your reactions to bad news, failed experiments, and unexpected challenges shape your culture far more than any mission statement.
?? Ask yourself:
?? When a team member brings you a problem instead of a solution, do you react with frustration—or with genuine curiosity?
?? When a deadline shifts due to unexpected complexity, is your first instinct to ask “Why is this late?”—or “What did we learn?”
?? Your answers matter.
Every response you give signals what truly gets rewarded in your culture—playing it safe or pushing boundaries.
As markets become more unpredictable and competition more intense, the most valuable organizations won’t be the ones with all the answers. They’ll be the ones that ask the questions others haven’t even considered.
Is Your Team Operating in Fear?
Most leaders assume their teams feel psychologically safe. The data tells a different story.
?? 85% of employees admit they hold back ideas due to fear.
The signs are subtle but costly:
?? Meetings dominated by the same few voices—while others stay silent.
?? "Safe" solutions get prioritized over optimal ones—risk-taking feels too dangerous.
?? Innovation happens in isolated efforts, not as a result of the process—because the system prioritizes predictability over bold thinking.
?? If your best ideas aren’t making it to the table, what’s it costing your business?
Fear kills innovation. Psychological safety fuels it. The only question is: Which one is shaping your culture?
Final Thought:
Fear-based cultures don’t fail overnight. They stagnate, playing it safe while competitors take bolder steps. By the time leadership notices, it’s already costing them market share, top talent, and long-term growth.
But the good news? Culture isn’t fixed—it’s built. Small, intentional shifts—how leaders react to challenges, how teams approach failure, and how innovation is measured—can transform an organization from risk-averse to breakthrough-driven.
The question isn’t whether fear is slowing your team down—it’s what you’ll do about it.
?? Unlock Your Team’s Full Potential
Most companies track performance—but few measure what actually fuels innovation.
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Edward Kreiman is a fractional CTO and scaling expert who has led technology transformations at Amazon, JPMorgan Chase, Playtech, and multiple PE/VC-backed companies. He specializes in helping organizations overcome scaling challenges, cut operational costs, and unlock innovation potential through cultural and technical transformation.