How Leaders with Divergent Visions Generate Novel Strategy: Navigating the Paradox of Preservation and Modernization in Swiss Watchmaking

Abstract

How do leaders with divergent visions for their organization come together to create a novel strategy? This paper employs paradox as a lens to investigate how leader-dyads can integrate opposing strategies to produce a new, generative approach. Drawing on a qualitative historical case study of Switzerland’s largest watch company—Société de Microélectronique et d'Horlogerie—during the quartz crisis in Swiss watchmaking, we induce a process model from the activities of two leaders whose relationship embodied the tensions and strategic contradictions of preserving the past and modernizing for the future. The model specifies a set of individual, relational, and structural mechanisms by which leaders productively engage with a preservation-modernization paradox to facilitate novel strategy in the wake of a discontinuity. We interpret our findings in terms of the demands of navigating the management and outcomes of strategic paradoxes. While tracing the theoretical and practical implications of our model and our findings, we address leadership conundrums characteristic of organizations confronting paradox.