Smart leaders have cracked the code on breakthrough thinking. It’s not about being the smartest person in the room. It’s about expanding the room itself.
Recent research from Harvard Business Review reveals that leaders who actively cultivate curiosity drive 34% higher team innovation and 26% greater employee engagement. Yet most executives unknowingly shrink their organisation’s capacity for fresh ideas through a common trap by staying inside what they already know. The problem is limited contact with the new.
The Two-Circle Discovery That Changes Everything
At a business conference, a simple drawing revealed why some organisations consistently innovate while others stagnate. The presenter drew two circles on the board, one small, one large.
The insight wasn’t about what’s inside the circles. It was about the perimeter.
A small circle has a short perimeter, meaning fewer contact points with new ideas. A large circle has a long perimeter, creating more opportunities for fresh perspectives to connect with existing knowledge.
Innovation happens at the boundary where familiar meets unfamiliar.
Where Breakthrough Ideas Actually Come From
Biologist Stuart Kauffman calls this the “adjacent possible”, the set of opportunities that become available when you step slightly beyond current knowledge. Not into complete unknown territory. Just one step past your present frontier.
BCG’s 2024 research on curious CEOs found that breakthrough discoveries don’t emerge from total novelty or complete familiarity. They emerge at the intersection where what you know meets what you could discover.
This explains why LEGO successfully expanded from physical toys into video games, or why Amazon moved from books to cloud computing. Each innovation was adjacent to existing capabilities, not a big leap into the unknown.
McKinsey’s Fortune 500 CEO Study Reveals the Pattern
McKinsey’s analysis of 200 top-performing Fortune 500 CEOs uncovered a pattern. The highest performers shared one defining characteristic: a pervasive curiosity and learning mindset.
“The top leaders are the first to admit they don’t know everything,” says McKinsey senior partner Kurt Strovink. “They learned faster, were more adaptable, and had institutionalised methods for neutralising their weaknesses.”
These elite performers didn’t succeed through superior intelligence. They succeeded by systematically expanding their borders through small, intentional habits of curiosity.
How Curious Leaders Build Innovation Engines
Make Learning Visible and Valuable
Genpact, the $4 billion business process company, makes curiosity an explicit core value alongside courage and integrity. They screen hiring candidates for hunger to learn, not just existing knowledge and skills.
Their leaders spend 50% of their time with clients, 25% with external stakeholders, and only 25% on internal matters. This external focus creates constant exposure to new ideas and market signals.
Structure Productive Discomfort
JPMorgan Chase CEO Jamie Dimon tells his teams: “Don’t bring your best self, bring your worst self – put the problems on the table.” This isn’t about encouraging bad behaviour. It’s about organisational candour that surfaces hidden challenges before they become crises.
Microsoft’s Satya Nadella pushes his teams to “disrupt ourselves” by imagining competitors who understand their customers better. This proactive discomfort prevents the complacency that kills innovation.
Create Learning Systems, Not Just Learning Events
Harvard Business School research shows that curious organisations build explicit “social learning systems” that connect observation with insight extraction and sharing.
These companies maintain equal focus on exploiting current capabilities and exploring new possibilities. They reward discovery as much as delivery.
Four Ways to Expand Your Organisation’s Adjacent Possible
Build Bridges Between Distant Worlds
Innovation often happens when two unrelated ideas meet. Finance teams working with design thinking. HR departments applying data science. Operations groups using behavioural psychology.
Don’t force alignment. Create encounters. Let people bring their questions, frameworks, and passions to cross-functional challenges.
Hire for Curiosity, Train for Skills
Skills become obsolete. Curiosity compounds. Screen candidates for learning hunger and comfort with ambiguity. You can teach technical capabilities. You can’t teach intellectual appetite.
Make External Exposure Systematic
Random learning creates random results. Structure exposure to new ideas through reading circles, field immersions, research partnerships, and external advisory boards.
Allocate time and budget for exploration the same way you budget for operations. Curiosity requires investment, not just intention.
Reward Questions as Much as Answers
If every KPI points inward, your ideas will too. Measure and celebrate the quality of questions teams ask, not just the solutions they deliver.
Track how often teams engage with external ideas, test new approaches, and challenge existing assumptions.
The Mathematics of Innovation
BCG research confirms what the circle diagram illustrates. Companies with systematically curious leadership create exponentially more innovation opportunities.
Larger knowledge circles create longer perimeters where new ideas can connect with existing capabilities. This expanded surface area becomes the breeding ground for breakthrough innovations.
Organisations that optimise purely for efficiency shrink their contact surface with tomorrow. They become so focused on delivering today’s results that they lose tomorrow’s possibilities.
The evolution of AI, climate challenges, and shifting consumer expectations means yesterday’s solutions apply less to today’s problems. Companies face unprecedented challenges requiring novel approaches.
Francesca Gino’s Harvard research shows curiosity becomes especially valuable when:
- New technologies provide different paths forward
- Intense competition quickly eliminates traditional advantages
- Rapid change makes previous solutions less applicable
- Companies face unfamiliar challenges
One or more of these conditions apply to most businesses today. The leaders who systematically expand their adjacent possible will consistently outinnovate those who don’t.
The size of your circle determines the richness of your border. The richer your border, the stronger your capacity to imagine and shape what comes next.
