Tryg Group
Customer Succes Story
Tryg Group Forecasting – Beyond Budgeting
Customer
Tryg Group Forecasting
Region
Scandinavia
Industry
Insurance company
IT enviroment:
SAP, Oracle, SAS Inst. and Excel
Executive Summary
Tryg is the largest insurance company in Denmark, and the second largest in the Nordic region and with 7000 employees, they provide insurance for 2.55 million private individuals and 140,000 companies. One of Denmark's most modern and digitally controlled companies.
It is crucial for the executive board and the group
It is essential for the Executive Board and the Group to have insight into the development of the business in a number of areas. For this, Tryg had over a number of years developed advanced and complex Excel and Access models to support the forecast.
It was time and resource consuming
The challenge, however, was that the models required many manual processes. It took 6 weeks of work to collect and prepare a forecast, and at the same time it was technically difficult to show rolling forecasts – for the current year and 3 years ahead. It was often just in time Group Finance reached to deliver the forecast every quarter.
The Excel and Access model has, over time, become so large, complex, and personal dependent that the risk of errors, errors in business and inconsistent results is high. Furthermore, it was difficult and difficult to keep track of forecast versions, and control of the many explanations, as to who delivered what and when.
It was difficult to consolidate the many Excel sheets and models, and it was very time-consuming to check and validate the data and the consolidated versions, to be sure that the basis for the quarterly forecast was correct and of the right quality.
New digital and automated Rolling Forecast solution with Jedox, automates, streamlines the process and makes it easy for users
In autumn 2016, Tryg chose Jedox as a new platform to replace the running Excel / Access model, in a migration collaboration with Qbit.
With Jedox, Tryg gets an integrated and vibrant world, with rolling and dynamic forecasts from any start-up period, with automated data load, validation and direct consolidation of the reports and explanations.
What used to take 6 weeks now only takes 1 week
With Jedox, all data and business processes are digitized so that the solution guides the communication to the users in the business, and ensures that all input in the form of changes to forecasts, proposals for new initiatives and explanations are automatically collected and promptly consolidated. Instead of the cumbersome spreadsheets with many sub-sheets, the business now receives targeted, simple and easy-to-use forecasting tools in a modern browser that makes it easy and fast for users to access up-to-date information and quickly and easily report to the Group Finance.
Users report expectations and initiatives with related business case
Users have to relate to a number of conditions. For example, if there is an increase in burglary, what do we do? – what initiatives do we put in place to either reduce the number or adjust in terms or price, and what financial impact will it have.
Rolling Forecast based on finances and initiatives for the next 3 years
Management reports to the Executive Board are done to provide a forecast of the development, and expectations of the Tryg Group’s performance in the short and long term, to ensure that the dialogue at management level supports ongoing and agile consideration of whether the Group’s efforts and initiatives bring Tryg in the right direction: In Tryg’s Group forecast, it measures various elements and inputs, which are calculated and delivered in an overall forecast and P&L.
Safe solution: State-of-the-art Forecast and consolidation engine
How is the process for Rolling forecast at Denmark’s largest insurance company?
With Jedox, Tryg Ensurence has an automated forecasting process that can produce a day-to-day expected forecast 3 years ahead with the fewest possible resources. In addition, the Group’s controllers in Denmark, Sweden and Norway now have a common toolbox for financial ad hoc analysis.
Step 1 – Baseline
The starting point of the forecast is created by entering:
- Damage rates from the provisioning department
- Portfolio of insurance (stock) from data warehouse as well
- Realized costs from SAP
Group Finance secures data entry and opens up for the forecast version to be used, and clears forecast with local deadlines controllers, across countries and business units.
Step 2 – Entering and updating
After this, the forecast is open to a number of input / updates that the local controllers carry out in the system. It applies;
- Selection of rules in connection with 12 months projection of insurance portfolio
- Corrections and observations, index, inflation, etc., which affect the injury rate
- Creating new or updating existing business initiatives that have an impact on premiums, damages and costs
- Correction of FTE factor, to and departure of personnel having effect on cost calculation
Step 3 – Automatic calculation and consolidation engine
The system’s calculation and consolidation engine supports the local controllers at the push of a button to see the effects of entries and updates. The effects of initiatives, index, inflation, corrections and projections are easily and clearly illustrated as parts of layers in a “cake” that the controllers can use to analyze results and continuously fine-tune forecast.
Step 4 - Operating expenses
Group Finance excludes entry and allocates costs from cost centers to individual business units and products. The forecast version is then closed in the system and a report package forms the basis for the following:
- Communication of expected forecast to the financial markets
- Analysis for comparison with previous forecasts and causal differences
- Analysis and explanatory development in compensation level
- Technical result (income / cost) across countries and business units = technical result
In addition, the controllers with Jedox excel add-in, have free access to make their own ad hoc analyzes on the data, cubes, calculation rules, versions, etc. that make up the total solution.
Future
Tryg plans to use Jedox for more areas in the future. Tryg today uses another application for sales management and forecasting, and will replace it with Jedox for a more modern, user-friendly and integrated application. Furthermore, Tryg will consider using Jedox Artificial Intelligence to better predict changes / trends based on a lot of data, among other, if customers are about to leave, thereby allowing them to respond before it’s too late.
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