Dynamics of Innovation in the Electronic Watch Industry: A Comparative Business History of Longines (Switzerland) and Seiko (Japan), 1960-1980

Abstract

This article discusses the dynamics of innovation through a comparative business history of a Swiss watch company and a Japanese watch company. The design and production of quartz watches were major technological elements that enabled Japanese watch companies to strengthen their positions on the world market and challenge the traditional dominance of Swiss enterprises. A comparative analysis of the research and development activities at Longines (Switzerland) and Seiko (Japan), both of which promoted electronic watches in their respective countries, makes it possible to emphasize organizational differences and thereby shed light on the origins behind the competitiveness of Japanese watchmakers in the 1980s. This contribution argues that the dynamics of innovation resulted both from institutional differences between Switzerland and Japan, from the perspective of the Varieties of Capitalism and National Innovation Systems approaches, and from industry- specific and firm-specific institutional factors.