•Three fundamental IT affordances in an organization, namely collaborative affordance, organizational memory affordance, and process management affordance are considered.•These affordances harmonically coalign to produce the overall harmonic IT affordance (HITA) of the organization.•HITA is actualized by organizational courage to produce two forms of innovation: exploratory and exploitative.•The effect of actualized HITA is higher on exploratory innovation than exploitative innovation.•Exploitative innovation leads to exploratory innovation.•Two studies, one in US and the other in China lend support for our theory. Researchers and practitioners have long believed that information technology (IT) is a key tool for fostering innovation. However, there is a certain inconsistency in the literature, which makes it challenging for researchers to figure out exactly how and why IT plays such a pivotal, strategic organizational role. The motivation for this research is the multiple contradictory results reported by studies investigating the influence of information technology (IT) on organizational innovation. This study utilizes a fit-based perspective in an attempt to disentangle these contradictions. Using Venkatraman’s (1989) seminal paper on fit, we conceive of two critical fit-based concepts: harmonious IT affordance in an organization (HITA) and a subsequent fit between HITA and organizational courage. HITA reflects a covariance fit (coalignment) between the three major IT affordances in an organization—collaborative affordance, organizational memory affordance, and process management affordance. Organizational courage reflects the boldness (risk-taking ability) of the organization. Finally, HITA and organizational courage represent a matching fit (reflected as actualized HITA) that influences two kinds of innovation: exploratory and exploitative. Two studies, conducted in the US and Chinese contexts, provide support for this theory. The main contribution of the paper is in showing that IT can lead to innovation if (a) organizational IT affordances harmoniously coalign (as HITA); (b) and, organizational courage acts as a powerful contingency that actualizes HITA, and this actualized HITA influences innovation.