Background: Companies in their search for value creation face different challenges when undertaking digital transformation (DT). Incumbent firms struggle differently than smaller-sized or newer firms because of their characteristics. Therefore, there is a growing interest in defining what types of challenges incumbents face, and understanding what the viable strategies are, necessary to implement digital strategies efficiently. For instance, knowledge exploration and exploitation are key to DT, affecting the recombination of knowledge in different degrees, therefore, also impacting the reach and efficacy of DT itself. Hence, the understanding of knowledge creation, its sharing, and application in the setting of incumbent firms must be improved, providing a better understanding of how digital technologies can be effectively implemented within these types of firms. 

Purpose: The purpose of this study is to characterise the challenges that incumbents face during their DT journey, as well as to provide suggestions of strategies to adapt to them. This work also illustrates the role and importance of knowledge exploration and exploitation, and recombination throughout the firm. The goal of the study is to provide a framework for undertaking DT successfully. 

Method: The present study applied an inductive qualitative research approach with a single case study research design. The case study company was Telia Infra and included interviews with ten managers from all its different departments. The interviews were of a semi-structured nature to allow flexibility in the interview design.  

Conclusion: The highlights of the study’s outcomes are: (i) the disclosure of a relationship between barriers during DT and the digital maturity of the department, showing that knowledge sharing activities are beneficial in the longer term. (ii) A human-centric driven DT strategy, balancing explorative and exploitative activities is incredibly positive for the DT journey. This drives for (iii) exponential change strategies which results in more favourable environments for overcoming barriers and enabling DT.