Seminar – Tensional Fit: A Dialectical Model of Firm’s Internal Consistency, Contradictions and Strategy

Professor Moshe Farjoun, York University (and CJBS Visiting Research Fellow in 2017)

Internal ‘fit’ is one of the oldest, most essential and enduring notions in the field of strategy. While it provides a compact representation of firms and strategy, and a crisp explanation of competitive advantage, the established notion of internal fit discounts the generative and strategic benefits of tensions and contradictions and is relatively silent about strategy creation and change. In this paper, we reimagine the concept of internal fit in a way that addresses both of its limitations and fundamentally challenges its underlying ontological premises and those of available alternatives. We introduce the dialectical notion of ‘tensional fit’ to jointly highlight how tensions and contradictions may infuse fit, and how they continuously coevolve with it. This dual, more permeable, evolving and generative concept of fit, departs from prior synchronic and tension-free conceptions. As we also argue, capable of generating endogenous change, contradictions can, in some forms and degree, be value creating too. This allows tensional fit to jointly explain how firms create and change their strategies as well as how they enhance and sustain their competitive advantage. We use tensional fit as a gateway for developing a rich and dynamic model of strategy, particularly applicable to firms competing in shifting and complex environments.