Despite the implicit belief that IT innovations brings beneficial change, medical practitioners and healthcare professionals constantly struggle to realize the innovation potential of electronic medical records (EMR) system in revolutionizing clinical practices. To understand this conundrum, this paper uses an in-depth case study of an EMR implementation to develop a grounded theory of why, when, and how IT-innovation mediated change occur. We propose the Narrative Network Perspective that combines the analysis of the processes of configuration, implementation and use of the system. This combined view allows researchers to understand how “production narrative network”, infrastructure and the macrostructure in healthcare environment co-evolve with the idealized production narrative network inscribed in the EMR system within and across the three phases. By tracing and taking into account all these elements time, this perspective provides plausible answers to when and why organizational innovation occur with the introduction of IT innovations. (147)