Digital innovation is characterized by generativity, in which digital technologies act upon other technologies, products, services, or processes to generate innovations. Because of generativity, digital innovation should be understood as involving multiple events that could be associated with changes in the process and outcome of IS and business activities. Drawing upon Swanson’s (1994) tri-core model of IS innovation, this study argues that digital innovation could entail innovative IS activities in the functional IS, business administration, and business technology areas. Since these areas rely differently upon innovative digital technologies, this study suggests that organizations should pursue IT exploitation and IT exploration simultaneously in order to improve digital innovation capability.