Welcome to Speero’s Sideshow, episode 3. This is our new podcast where we interview operators, strategists, or leaders in experimentation, research, or growth to find what’s working now and where is our industry going.
During last year’s EXL, I was genuinely surprised to see a strategic finance professional there. It’s rare to see finance folks at these events, or even in most of the experimentation programs I work with.
As a CEO and a practitioner who still runs an experimentation program, I gotta say, I don’t like finance. I just want to press a button and have all the accounting done, without the spreadsheets and the endless conversations.
But over the years, I've come to see a key distinction: there's the backward-looking side of finance—the accounting and bookkeeping—and then there's the forward-looking side: strategic planning and budgeting.
Janet's role is director of strategic finance, and her job is to be forward-looking, working as a partner to the business. She's not just reporting revenue after it happens; she's involved in conversations about where to invest money and how to align spending with the company's future goals.
This is a complete game-changer for experimentation.
TLDR:
- Experimentation is a forward-looking investment process, not just a backward-looking way to measure past results.
- Bringing a strategic finance partner into the experimentation process from the beginning is a "game-changer." They can help reframe test designs to be as small and cost-effective as possible.
- Finance can act as a "Rosetta Stone," translating the work of experimenters into the language of senior leadership, focusing on metrics like ROI and revenue.
- All experiments should be aligned with top-down business goals. Finance partners can provide an objective, data-driven view to ensure investments support the company's financial vision.
- A good finance team is a thought partner and ally, not a gatekeeper. They help teams define guardrails for failure and make smart, sustainable decisions about where to invest.
- To be truly effective, finance should be a full, integrated member of cross-functional teams, helping to decide what problems to solve and how to solve them, rather than just being a budget-approver.
Experimentation as an Investment Process
A few years ago, the team at Hulu (and now Disney+ and ESPN) went through a journey to implement a Center of Excellence. In an article about it, there's a graphic showing their experimentation pod, and right there alongside the designer and strategist is a little bubble for finance.
This highlights something crucial: from a finance perspective, experimentation is an investment process. When finance is involved, they're often asked to trade off where to spend money.
Should we invest in Product A or Product B? Or should we test Team A versus Team B to see which has more long-term impact? This makes experimentation central to their decision-making process and to evaluating results.
Finance works lockstep with product, sales, and marketing teams to decide where to invest. They ask key questions:
- What experiments should we run?
- How much will they cost?
- What metrics will we use to measure success?
And most importantly, they ensure there's a process to track results and tie them to tangible metrics like ROI or revenue. They advise on what the expected return on investment should be, whether that's from a new product launch or a new hire.
They want to know what the return will be compared to the cost, and they want to follow up to make sure it's successful. As my friend Chris Mercer says, it should be "measurement marketing, not marketing measurement". You set up the measurement plan before your marketing, not the other way around.
Finance first, Test Later
The biggest problem is when people make decisions without finance and then bring them in after the fact. When finance is involved early, they can help you reframe the study design to be as small as possible.
The core idea of experimentation is to start with the smallest possible test to see if it warrants a bigger investment. A finance partner can help prevent a team from spending a lot on one test when they could have run multiple smaller tests for a fraction of the cost.
Janet gave a great example of this: "a team wanted to launch a new product integration to 20 top customers." By bringing finance in early, they could reframe the plan to test it with just one or two customers first.
This allowed them to collect data, validate the concept, and then make a clear, data-driven case to the executive team for a bigger investment later. This is how you prove your program is a good use of funds.
The language of "bets" and "investments" is a key part of this. A "bet" is something new with a lot of ambiguity and risk, where you might not even know what success looks like.
An "investment," on the other hand, is a decision you're confident will pay off in the long term. This language helps the organization understand the different types of risks and opportunities they're taking.
Align Experiments to Your Business Goal
It's a big challenge to make sure your experiments align with the broader business goals. A successful process starts with a top-down vision from the executive team that aligns with the customer's needs. This vision needs to be clearly communicated throughout the organization.
For larger experiments, you need full alignment across multiple teams. A good process has clear stages of review, where teams can state their perspective and what they need.
Finance can help here by providing an objective, empirical view of the situation. They can model the potential outcomes and help the team understand the risks.
The role of a finance partner is to be an objective third party, not a blocker. They want to ensure that every investment supports the company's financial goals.
They should be empowered to say no and to flag when an idea doesn't align with the vision. This is crucial for growing an organization in a smart, sustainable way, because you can't grow forever at an unlimited cost.
This is where artifacts like financial models and goal tree maps can be powerful tools for governance. They provide a data-driven framework that teams can use to make decisions on their own, even without a finance partner in the room.
It's about grounding decisions in data and being open to what the numbers say, even if it's not what you want to hear.
Merging Experimentation and Finance
Experimentation is naturally cross-functional. My audience is often working in digital experimentation, with product, design, and engineering teams.
But for Janet, marketing is one of the most important stakeholders, as they control the budget for things like paid media and other growth investments. In these meetings, you'll see a mix of people: business stakeholders, engineers, operations, product managers, and finance.
A finance partner can help a team understand the P&L impact of their spending and what success looks like for the money they're investing. They also help to define the guardrails for failure. When do we know to stop spending if something isn't working?
I've been creating financial models for experimentation programs for some time now, and I always advise teams that if they feel stuck, they need to align with finance. Having a finance partner as an ally is incredibly powerful for making your case and getting on solid footing.
Finance can be the Rosetta Stone that translates the work of experimenters into a language C-suite leaders understand. As Janet says, "she's trying to break the stereotype that finance is just a bad cop, a number-cruncher who says no."
A good finance team is a thought partner who brings an analytical lens to the team and helps them understand what their end goal should be. The earlier you build this financial "soul" into an organization, the better, because it's much harder to implement these rules and a new culture when a company has grown too big.
This is why the product operating model and the idea of cross-functional, accountable squads are so important. You're moving people from being "shippers of tickets" to "shapers of experience". And now, it's clear that finance needs to be part of that shaping.
They are not just a gatekeeper but a full member of the team, helping to decide what problems to solve and how to solve them. It's a completely different way of thinking that blows my mind, and it's what every organization needs to be doing.
.svg)
