Higher education industry in Indonesia is currently undergoing a significant transformation driven by contemporary technology. Unfortunately, little attention has been given to the intersection between digital innovation, organizational capabilities, and higher education institutions. This paper examines the way in which higher education institution is thriving in the era of digital economy by analyzing its innovative capability. This study identifies such capability utilizing technology/systems innovation readiness scale (OITIRS) using the case of Janabadra University, one of the oldest private university in Indonesia. Data is obtained from primary sources as well as secondary data. Results shows that there are several gap that can be closed and a number of recommendation are proposed to improve the relevance of higher education institution in the digital economy era. It is expected that the findings of this study can also be adopted and implemented in other public institutions as well.