The presence of digital infrastructures fundamentally changes market conditions, business and IT strategy, and consequently organizational structures. This research investigates how the concept of a digital business strategy leads to increased organizational innovativeness and firm performance. We demonstrate how IT capabilities contribute to organizational innovativeness and induce the CIO’s positive role for IT-enabled business innovation. By means of an online survey among 228 IT decision makers in knowledge-intensive industries in the U.S., the results reveal organizational innovativeness being significantly higher influenced by the IT knowledge of business employees in organizations giving the digital business strategy high importance, whereas the top management team IT knowledge plays a greater role when digital business strategy is given low priority. By this research, we deliver first results of consequences for organizations conducting a digital business strategy and contribute to the discussion on IT-enabled innovation, CIO leadership, and the increasing relevance of organization-wide IT capabilities.