This study aims to explain digital transformation of firms to real-time enterprises (RTE) that can successfully sense and manage important business events that appear as opportunities and threats in the digitized business world. We define RTE capabilities as the organizational ability to sense and act to important business events in a timely manner. Furthermore, we define sensemaking and acting capability as two dimensions of RTE capabilities and business intelligence and communication support as two key information technologies for digital transformation into RTE. Using 191 survey responses from 96 firms in diverse industries, we find that the different roles of BI and communication support technologies in achieving high RTE capabilities and firm performance across different environmental velocities. IT enables firms to achieve competitive advantage indirectly by enhancing RTE capabilities in fast environments. In slow environments, RTE capabilities appear not to enhance performance, but instead frequent actions to reconfigure resources and structures seem to deteriorate competitive advantage.