Nicolas Hayek, businessman and man of ideas

Can an empire be built on a small plastic quartz watch? Yes—when your name is Nicolas Hayek and you are a visionary, halfway between a talented businessman and a brilliant source of new ideas. By creating the Swatch, he laid the foundations of an immensely prosperous company—and, along the way, saved the Swiss watchmaking industry. So let us set out to discover this watchmaking industrialist.

Nicolas Hayek: when the entrepreneur becomes an artist

Like computing or the automotive industry, the history of modern watchmaking is shaped by both brilliant inventors and business geniuses. These two traits are not contradictory, because it sometimes happens that making an innovative timepiece requires the help of the person who best knows how to sell it. The precedent of the complex relationship, in the technology world, between Apple’s two Steve founders—Wozniak the engineer and Jobs the marketer—shows that History sometimes remembers the visionary rather than the technician. Nicolas Hayek is one of those visionaries History does not forget. He would be Jobs rather than Wozniak—the epicentre of an earthquake that profoundly shook the Swiss watch industry. Born Lebanese—in 1928—and later naturalised Swiss, Hayek encountered the “tick-tock” of watches only late in life. The anecdotes about major watchmakers who spent their childhood taking chronographs apart were not for him. Hayek was a man of documents rather than dials. After studying mathematics and physics in France, he landed a job at a reinsurance company in Zurich: his first contact with a Switzerland he would never leave.

It was there, in 1949, that he had two pivotal encounters: with his wife, and with his destiny. His wife’s family owned a small foundry specialising in the manufacture of brake shoes for railway wagons. When health problems forced her father to step back, Nicolas Hayek was asked to take over the management of the business—something he did boldly, convinced that the right marketing strategy is what builds success. The results proved him right: the foundry became very popular and expanded rapidly. If every human being on this planet has a unique talent, Hayek now knows his: he is the one who makes things work.

Later on, he would often say that the entrepreneur is also an artist. Creating a business is as demanding as creating a work of art: it is a process that requires an enormous amount of work, a great deal of technique, and a healthy dose of talent.

The tactics of a man who loved the “tick-tock” of watches

Following his adventures in the foundry, Nicolas Hayek launched his own company: Hayek Engineering Inc., a Zurich-based consulting firm. Soon, 250 consultants were working across many fields, from automotive manufacturing to Swiss public administration (including the City of Zurich). It was through his company that he crossed paths with watches. At the dawn of the 1980s, Hayek was commissioned for a rather unusual audit: to take a deep dive into the Swiss watch industry. The world’s leading watchmaking nation was in turmoil, as Japan set out to transform the traditional relationship between people and watches by creating quartz timepieces—cheaper, and therefore more accessible. The world was changing, and so was its economy. Except that the Swiss industry had buried its head in the sand, refusing to take these developments into account—this was Hayek’s harsh assessment. But it reflected reality: in just five years, the market share of high-end Swiss watches fell from 50% to 15%. With a keen understanding of the mechanisms that underpin the economic world, Hayek took matters into his own hands. In 1983, he oversaw the merger of SSIH and ASUAG, two Swiss watch companies on the verge of collapse. He named the new structure the Swiss Corporation for Microelectronics and Watchmaking (SMH) and launched his own revolution: the first quartz watch made in the country of Haute Horlogerie. The Swatch was not a storm—it was a hurricane. Hayek changed the world. And he did it with a modest piece of plastic sold for 50 Swiss francs. Try to imagine Nicolas Hayek’s thought process: the Japanese were flooding the market with simpler watches, easier to manufacture, inexpensive to produce, giving an entire population the opportunity to buy one of these objects that had once been too costly. But the Japanese fell short on two points: design and movement quality. Hayek’s idea was built on that observation. He wanted to design watches of very good quality—durable, attractive—but watches that would be like fashion accessories, scarves or hats: easy to change. This was the principle of the “second watch”, or “Second Watch”. Contracted, the two terms became “Swatch”.

So Swatch it be!

The Swatch was a tremendous success; the visionary became a guru of Swiss watches. The industry’s shipwreck was averted. Hayek used his growing power to take control of most of the great names in luxury watchmaking: Blancpain, Breguet, Jaquet Droz, Glasshüte Originals, Léon Hatot. At the same time, Tiffany’s and Calvin Klein entrusted him with the reins of their watch lines, eager to glean a little of his talent. It would take a few more years for SMH to become the Swatch Group, in 1998. What better way for Hayek to pay tribute to the creation that propelled him to the head of the largest consortium of watch brands? Since 1984 and the official launch of the Swatch, the group has sold no fewer than 400 million units of the small watch. However, Nicolas Hayek’s ambition did not stop there. The Swatch is a dual object, rooted in both the present and the future. While democratising the watch—allowing anyone to wear one on their wrist—he also designed an accessory that serves as a bridge to the high end. Hayek’s bet was this: loving the Swatch today may mean falling in love tomorrow with a luxury timepiece… and why not a model from one of the group’s brands? Hayek did not apply his vision only to watchmaking. Regularly sought out for his advice on the economy (he was awarded the title of honoris causa doctor by the universities of Neuchâtel and Bologna), he was also behind the Smart, the small car whose name comes from the contraction of three terms: Swatch, Mercedes and Art. Here again, Hayek—well ahead of his time—anticipated modern mobility needs by a good decade: his vehicle was electric and designed for urban use. A vision that, at the time, so frightened car manufacturers that they did not dare to see his project through. (Take a look at this page to learn more about the history of the Smart.) When Nicolas Hayek died in 2010, the Swatch Group was worth 5.4 billion Swiss francs, employed 24,000 people, operated 160 factories, and spanned 19 brands. Engineers design innovative, precious movements. Visionaries, for their part, build empires.