Jaro Malach, General Manager
Change is constant in business. To stay one step ahead of adverse events, companies need to proactively rehash their financial planning, budgeting, and forecasting strategies. Actionable data can help them make educated decisions and navigate the future successfully.
With over three decades of experience in the corporate finance realm, GIDE International Limited puts an end to the guessing game with its robust financial planning and analysis (FP&A) and financial modeling solution. At its core, the solution enables companies to foresee their financial future. “Our thoughtfully-crafted solution reflects our philosophy of guiding companies through all the financial aspects, eliminating any need to make a ‘U’ turn. And, our company name portrays just that, ‘Guide’ with a missing ‘U’—GIDE,” says Jaro Malach, General Manager, GIDE International Limited.
MYGIDE was a bona fide greenfield development project of a financial modeling software focused on shaping the financial future of businesses rather than relying solely on historical data and insights. As corporate finance advisors, Malach and his team were into advising companies on M&A transactions, restructuring, or capital raising. In one instance, they had to offer consulting for the disposal of a corporate group with 15 different business organizations operating in different countries. And the team struggled to process the data efficiently. The bigger challenge lay in maintaining the source of data from these companies, collating it, and making coherent three-way financial models, valuation models, and restructuring models for presenting to investors, shareholders, and banks. The need was for a solution to process the data effectively and take a systemic approach to offer proper advice with surgical precision. The solution had to be agile and flexible for different situations and also provide an alternative to the lengthy data building strategies of BIs and Excel. “Time proved ripe to develop our flagship financial modeling tool,” says Malach. “Lo and behold, MYGIDE was born.”
MYGIDE was designed to pave the way for evidence-based decision-making. The system was built to deal with a variety of financial and operational data and all the important components, such as balance sheet, capex, cash flows, and valuation, among others.
Although MYGIDE was initially developed to underpin the advisory function, it was spun off as a separate company, GIDE International Limited.
Swift Response to Changes
According to Malach, most CPM solutions in the market are focused on the collection of data from within the organization for budgeting and forecasting. For strategic planning, the data is sourced from the CPM solution and analyzed or processed in business spreadsheets by a person who is a master of a model. Conversely, MYGIDE has all the functions connected together holistically. “We believe in defining the strategic plan and deriving the budget from it. MYGIDE What-If Analysis aids in exploring different alternatives. These plans or extrapolations will change the moment new data is received because it is always a combination of the past, present, and the future,” explains Malach.
It’s not about guessing the future, but assessing the likely situations they can encounter and the impact it will have on their cash flow, shareholders, or bankers
To illustrate this better, Malach draws attention to the past year. In the first phase of the pandemic, smart companies realized that there was no point in sticking to a budget that was made 12 or 18 months ago when the situation was completely different. “However, businesses have to think well ahead in situations like COVID-19. It is not about guessing the future but assessing the likely situations they can encounter and the impact it will have on their cash flow, shareholders, or bankers,” explains Malach. “Our focus is on rolling forecasts to run strategic plans, plan outlooks constantly with each new data, which comes to the models, for agility, and to update models, which are key to address the ever-changing business conditions. Working with constantly changing forecasts empowers the management to better react to changing situations and the CFO to act as a value-added partner to the business.”
Taking the Lead
MYGIDE boasts a slew of functionalities that include bank models, sales and seasonality models, resource optimization models, evaluation algorithms, and capital raising algorithms, among others. “We are able to consolidate financial and non-financial data in one core financial model that bankers and investors appreciate,” says Malach.
The main highlights of the solution include a deterministic approach to modeling, stochastic modeling, and AI-based models, which suggest the best strategies going forward. The solution also facilitates cross-functional teamwork between accounts receivable, accounts payable, HR, or production, enabling finance business partners to help the various stakeholders understand and collaborate on the financial models. This will enable them to appreciate the impact on the performance of the business or on specific issues such as cash management or profit and loss within their roles and responsibilities.
To top it off, most of the real-life applications in MYGIDE can be readily used by businesses and applied to different situations without needing to involve software coders. “Speed is a very important factor, not only calculation wise, but in terms of deploying the solution or even redeploying it. Moreover, the whole organization need not be integrated with the system to fully benefit from it,” states Malach.
From a surfeit of success stories in their repertoire, Malach puts the spotlight on a district and industrial heating company, a part of a larger conglomerate. Their big challenge was that they had ten production locations, with numerous off-take points, engaged in a complex intragroup commodity flow involving pressured air, steam, and power that determined individual pricing at each off-take point. The difficulty in such situations is to have a balance of the intragroup of commodities because it is a production chain. “What we delivered for the company is a clear commodity balancing, full P&L performance, commodity-based sales and variable costs, and a good contract with their key supplier,” explains Malach.
Touching upon their future plans, Malach envisions a huge demand for their automated services where they have increased investments in the wake of companies operating on a remote basis. “We see our future in AI model development and systems development,” states Malach. The focus is on strengthening the cornerstone of their offerings to render services to private equity firms, startups or support restructuring assignments according to market demand.
“And whilst future is always unclear, successful finance professionals and business investors always look into the future, proactively shaping businesses towards meeting their desired goals,” signs off Malach.