Aligning ERP Strategy with Economic Cycles: When Is the Right Time?

Roger Pujol, CPIM, CSCP
Apr 19
3 min read

Updated: Apr 22

Timing is crucial in ERP implementations — The Best Time to Start an ERP Implementation: Why the Economy Should Be Part of the Equation.

Timing is crucial in ERP (Enterprise Resource Planning) implementations. Some might argue that there is never a right time, or it is always the worst time. Companies typically concentrate on internal signals—such as operational inefficiencies, system limitations, or organizational growth—as indicators for initiating an ERP project. However, a significant external factor frequently ignored is the state of the economy. Implementing a manufacturing ERP system may take 12 to 24 months to become fully operational. As a result, the economic conditions might differ from those at the time of initial planning.

While it might not seem intuitive initially, the broader economic climate can significantly impact the success of your ERP implementation. So, when is the best time to kick off your project? Let’s explore how economic conditions influence your timing and how to make the most of them.

1. Economic Slowdowns: A Hidden Opportunity

Many businesses instinctively shift into cost-cutting mode during economic downturns or periods of uncertainty. However, this can be a strategic window for implementing an ERP.

Here’s why:

Capacity Availability: With business operations potentially slowing down, your internal teams may have more bandwidth to dedicate to the implementation process—something that’s harder to come by during peak production or busy seasons.
Vendor Flexibility: ERP vendors and consultants may also have more availability during economic lulls, which could mean better pricing, more attention to your project, and faster response times.
Readiness for Recovery: Implementing during a downturn allows you to hit the ground running when the market rebounds. Instead of scrambling to modernize your systems mid-growth spurt, you’ll already have the tools to scale efficiently.

2. Economic Growth: Fueling ERP-Driven Expansion

On the flip side, starting an ERP implementation that could disrupt day-to-day operations might feel risky if your business is riding a wave of economic growth. But that same momentum can also be your greatest asset.

Consider these benefits:

Budget Availability: When revenues are strong, businesses often have more discretionary budget to invest in long-term infrastructure like ERP systems.
Support for Change: Teams may be more open to adopting new tools when they see them as part of a growth strategy rather than a reaction to a crisis.
Technology as a Growth Lever: A modern ERP system can optimize rapidly scaling operations, streamline workflows, and improve decision-making across departments—all crucial when growing fast.

3. Stable Periods: The Safe Middle Ground

Planning and executing an ERP project may be the most comfortable time if the economy is relatively stable and predictable. You’ll have fewer surprises and can develop a well-paced, phased implementation plan.

This environment supports:

Long-term planning without pressure to rush.
Balanced resource allocation across business units.
Lower risk appetite, which can make executives and stakeholders more supportive of careful, structured implementation.

Timing Strategy: Look Inward and Outward

While economic indicators shouldn’t be the only factor in your decision to start an ERP project, they should absolutely be part of the conversation.

Here are a few tips to align your ERP timing with economic realities:

Conduct a timing feasibility study: Map out your internal readiness alongside macroeconomic trends.
Think counter-cyclically: Starting in a downturn can give you a head start before competitors rebound.
Factor in supply chain and industry trends: Global supply chain shifts, especially in the manufacturing and distribution sectors, can make ERP modernization more urgent.

Final Thoughts

ERP implementations require a significant investment of time, money, and energy. The timing of the rollout can be crucial, as it can differentiate between a smooth rollout and a costly detour. By considering your business's current state and the economy's future direction, you can position your ERP project for maximum strategic impact.

Ready to assess whether now is the right time?

Let’s discuss your goals, challenges, and how the current economic climate affects your digital transformation strategy. Feel free to contact us at your convenience, and we can assist you in making the right decision for your business.

Roger Pujol, CPIM, CSCP, the founder of Champion Business Solutions, LLC, is a consultant specializing in ERP Business software. He shares insights and experiences on assisting small and medium-sized businesses (SMBs) to enhance their operations.