Increasing the quality of plans and forecasts : using more complex planning methods and linking these to the bonus system

In the current situation of volatile markets, managers are seeking for better ways of predicting the future than the traditional ones present in their companies. Fortunately there is abundance of literature about new approaches to planning and forecasting. Hypotheses set in the introduction were checked and evaluated in the environment of insurance business company. Quick-fixes represent improvements where no significant structural change is necessary and still material changes are present. According to the analyses provided, these fast improvements focus mainly on better communication among the related parties and on decreasing the demandingness of the planning process which increases the efficiency of planning and forecasting. They also succeed in making the plans and forecasts more realistic and simple to prepare and understand. The biggest attention is devoted to substantial improvements such as rolling forecasts, scenario planning and Monte Carlo simulations. The complex methods case studies with sales projections showed that predictions are more specific, realistic and complete. The models are easy to change and offer the opportunity of using what-if projections. The link to bonuses has proven that even in the world of complex methods, the clear target setting and evaluation is retained.