This thesis explores how organizational leaders experience and manage digital transformation (DT), with a focus on Software-as-a-Service (SaaS) with an often emerging combination with AI-enhanced SaaS adoption. While much prior research emphasizes infrastructure and performance, this study examines the interpretive and relational dimensions of leadership during technological disruption. The central concern is how leaders perceive, frame, and enact digital tools in ways that shape both organizational outcomes and employee responses.Using a qualitative, narrative design grounded in social constructivism, nine semi-structured interviews were conducted with leaders across biotechnology, law, media, consulting, public administration, and fintech. An abductive thematic analysis, guided by sensemaking (Weick, 1995) and affordance theory (Gibson, 1979), traced how leaders constructed meaning retrospectively and socially while identifying and acting on the possibilities that technologies afforded.Findings show that adoption was motivated less by abstract strategy than by concrete payoffs such as efficiency, integration, and confidentiality, with leaders retrospectively rationalizing these as organizationally plausible benefits. Implementation was mediated through training, mentoring, and narrative framing, which made technical affordances visible and meaningful. Yet adoption was hindered by resistance, fears of surveillance and job loss, data security concerns, and ethical dilemmas around AI’s impact on skills and creativity. Leaders consistently framed SaaS as enabling efficiency, collaboration, and professional growth, while employees often perceived risks and losses. The study highlights digital transformation as a cultural and narrative process as much as a technical one, showing that affordances exist materially but gain organizational significance only through leaders’ sensemaking and sensegiving.