This thesis comprises of three studies which attempt to address unanswered questions in the prior research on the role of IT in firm innovation specifically: How do firms manage their capabilities and activities with respect to innovation via various types of IT-related resources? The first study of this thesis attempts to address one such gap by theorizing and testing how firms manage their capability for creating innovation (i.e., absorptive capacity) via an IT-related human resource (i.e., high-skilled foreign tech professionals). Regression analyses on 80 semiconductor and 77 software firms suggest that U.S. high-tech firms seek to manage their innovation-related capability by recruiting foreign talents due to their low inter-firm labor mobility as a result of visa regulations. This can counter the high-levels of inter-firm labor mobility in high-tech industries which hampers firms’ innovation capability. The second study of this thesis attempts to address another such gap by investigating whether major IT systems implemented in firms (e.g., ERP, KMS, HRMS, CRM, and SCM) can help them to conduct their entrepreneurial actions of creating new businesses, a key form of innovation activity. This study exploits a unique population-level panel survey data on South Korean firms during the 2007-2013 period. Initial analyses on 7839 South Korean manufacturing firms find that the number of IT systems implemented in the firm increases the probability of conducting entrepreneurial actions of creating new businesses (i.e., plan to start a new business). In addition, the impact of the number of IT on firms’ plan to start a new business in industries different from their current industry is strengthened under turbulent environments i.e., in this case, the financial crisis period; 2008-2009. Building on these results, the third study plans to conduct fuzzy-set Qualitative Comparative Analysis (fs/QCA) to identify portfolios of IT systems in firms which can contribute to their entrepreneurial actions.