A Paradox Perspective on Business Model Innovation in Sustainability-Oriented Industries: A Longitudinal Case Study in the Energy Sector

This study examines how Business Model Innovation (BMI) unfolds in sustainability‐oriented industries, where institutional complexity, technological interdependence, and environmental imperatives generate persistent sustainability‐related paradoxical tensions. Drawing on a longitudinal case of a European system integrator in renewable energy and electric mobility, based on interviews and internal documentation, we trace how a strategic‐level paradox propagates across organizational layers. The thematic coding analysis reveals the multilevel tensions shaping the case. By tracing how these tensions evolve over time, we identify a recurrent paradox‐enactment process composed of paradox recognition and integrative framing. We show that the organizational locus of first recognition conditions how tensions are interpreted, which heuristics emerge, and whether enactment proceeds through top‐down cascade or bottom‐up escalation, with managerial agency and resource slack moderating the depth of the response. Critically, these dynamics condition BMI trajectories: Tensions governable within an existing value logic produce single‐loop adjustments, while persistent misalignment triggers double‐loop reframing of value creation, delivery, and capture. In doing so, we advance paradox theory by showing that BMI trajectories are tension‐conditioned rather than purely opportunity‐driven.