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This study explores the relationship between innovation and tradition in family firms. By examining how these firms manage the potential tension between these two elements, the study aims to understand better how innovation and tradition coexist and support long-term survival across generations.

This study has a constructivist standpoint and follows a qualitative methodology. By conducting a comparative case study, the data are collected from semi-structured interviews with 10 participants in 4 case companies located in Sweden. The data are analysed using thematic analysis.

This study found that managing the tension between innovation and tradition is carried out through four mechanisms: forward thinking through heritage, paradoxical thinking, operational control and governance. Moreover, the study further shows the great importance of the concept of intergenerational learning in family firms in managing tension.

The findings from this study contribute to the existing literature in family firms concerning managing tradition and innovation by providing a novel conceptualisation of the mechanisms embedded in this process. Moreover, the article proposes a grounded model, which could be used in research and practice when dealing with similar issues.