Purpose: The aim of this study is to examine (i) the impact of the fit between product-service strategy and sensing capability on novelty, and (ii) the potential moderating impact of contextual factors (i.e. technological and market turbulence) on novelty. Design/methodology/approach: In line with the aim of the study, a quantitative approach was adopted and a multi-item scale survey was designed to collect primary data. Using a mixed mode survey, a total number of 491 questionnaires were collected from a sample of UK-based telecommunications firms. Multiple regression was employed to test the hypotheses and predict the outcomes. Findings: The results support the positive contribution of a contingency approach to the study of the impact of the fit between product-service strategy and sensing dynamic capability on novelty. The results also partially confirm the reinforcing impact of technological and market turbulence on novelty. Originality/value: The current study extends research on product-service strategy and sensing capability by adopting a contingency view which intends to serve two purposes: (i)to complement the existing reductionistic explanations, and (ii) to explore how the relationship between product-service strategy and sensing capability could create novelty as well as the degree to which this relationship could be moderated in light of the external contextual factors.