My three interesting things this month…
1. Escaping the execution layer as CFO
Recently, I’ve been sharing a lot about the skills CFOs need to succeed, especially the ones that get less attention earlier in a finance career.
Delegating, developing people and setting priorities all matter. So does influencing across the business and protecting time for higher-value work.
You can develop each skill individually, but together they point to a bigger change every CFO has to make: moving from being execution first to strategy first.
Earlier in your career, progress comes from knowing the details and solving problems. Those strengths still matter at CFO level, but they’re no longer where your maximum value comes from.
The CFO role requires you to use your time differently and solve problems at a higher level. Without a conscious effort, it’s easy to carry execution-led habits into a position that needs you to operate much more strategically.
What changes in the strategic layer?
The clearest difference is where your impact comes from.
In the execution layer, your value is tied to the work you personally review or deliver. At CFO level, it comes more from what happens because of you.
Your focus moves further ahead too. You still need to understand what’s happening this quarter, but more attention should go towards what the business will need next and how finance needs to evolve.
You should see the difference across the organisation. Decisions happen at the right level, recurring issues are fixed properly and finance becomes less dependent on the CFO.
Results might be less obvious day to day, but they reach much further.
A framework for the strategic CFO role
I use five areas to help finance leaders understand where to focus their development as a strategy-first CFO.
- Influence: how you work across the business and with the stakeholders you need to bring with you
- Impact: generating business value and driving performance
- Innovation: transforming finance while helping the wider business innovate. And, of course, AI will be a big part of that
- Operating model: finance needs to be set up to deliver the above
- Leadership: how you lead within finance and across the wider business
Over the next five months, I’ll explore each area in more detail. For now, it’s worth asking: Has the way you work changed as much as the role itself has?
2) Frameworks first: make fewer, better decisions
I touched on frameworks in a recent newsletter, and quite a few people asked how to use them in practice. So here’s a principle I’ve been using more and more in my coaching: frameworks first.
A framework is an agreed way of approaching a recurring decision. It might define how priorities are set or who has authority. The important part is the order: agree the framework first, then let individual decisions sit inside it.
There are only two options after that. Either follow the framework, or make the case for changing it. Changing an agreed principle should be a much higher bar than challenging one decision you don’t like.
For example, a business might agree that operating costs should sit at 30% of revenue. Any proposed spend is judged against that figure. If it takes costs above 30%, the answer is no unless there’s a strong reason to revisit the framework.
One clear principle can replace a lot of repeated debate.
How to build a useful framework
The process is: Design → theorise → test → roll out
Start with a principle that’s simple enough to draw on a whiteboard and remember later. Be clear about why it should work, then test it and refine it before using it more widely.
Measurement needs to be agreed upfront. You need to know what success looks like and what evidence would tell you the framework needs to change.
Ray Dalio’s Principles is a useful reference point. The idea is to build a bank of tested principles rather than treating every situation as completely new.
It takes practice. Becoming good at spotting recurring patterns and turning them into useful frameworks can take around 18 months. But each framework makes a whole category of future decisions easier.
Why frameworks work
They reduce decision load
Frameworks give the CFO and the wider team a clear basis for decision-making.
Instead of weighing up the whole issue again, you test it against the agreed principle. Decisions become faster and more consistent, and fewer questions need to move upwards.
The CFO spends less time revisiting similar issues and more time improving the principles that guide them.
They make change easier to manage
Without a framework, decisions around change can become subjective. People debate whether an initiative is working or whether it should move to the next stage.
A framework defines success and sets the conditions for moving forward.
Again, measurement has to be agreed at the beginning. Otherwise, several things can change at once and nobody knows what actually drove the result.
They take some of the politics out
Difficult decisions can easily become personal when there’s no agreed approach.
A framework changes the conversation. Instead of challenging the person, you’re asking whether the agreed process was followed.
One client was dealing with repeated confusion around people moving between teams. A simple framework could require each transfer or secondment to be recorded through HR, with a clear return date or backfill point.
The rule needs to be agreed before the next incident. If someone wants an exception later, the discussion becomes much more objective: why is it needed, and who has authority to approve it?
They help you grow as a leader
Senior finance leaders need to turn complicated situations into something other people can understand and use.
Many already do this instinctively. The next step is to make the thinking explicit.
Saying, “The framework I use for this is…” shows how you approach a whole category of decisions. It’s particularly useful in CFO interviews or senior stakeholder conversations, where people want to see how you bring clarity to complexity.
If you’re introducing clearer frameworks across your finance team, get in touch and let me know what you’re working through.
3. AI, ERP transformation and the private equity opportunity
This might be one of the more debated predictions I’ve shared, but I think it’s going to become a huge theme over the next three to four years:
I expect that AI-enabled ERP transformations are going to become one of private equity’s biggest value-creation opportunities, with finance at the centre of it.
That’s a lot to pack into one sentence, so here’s how I’m thinking about it.
Finance teams are already exploring how AI can improve entire workflows. The next stage is much bigger: connecting AI to the core systems that businesses run on.
ERP is where the opportunity gets really interesting. Redesigning the underlying system changes how the business operates, rather than just making a few tasks faster.
For private equity, the prize is a repeatable way to modernise acquired businesses and unlock value much earlier.
From messy processes to a closed system
ERP systems become more complicated as businesses grow. Requirements change, teams create workarounds and processes become dependent on people who understand all the exceptions.
AI gives businesses the chance to start again from first principles.
It can map how work happens today and help design a cleaner workflow around the required output. The goal is a closed system where AI handles most of the logic and people step in when genuine judgement is needed.
Instead of dozens of people moving the process forward, you get a much more controlled and repeatable flow.
Run the old and new models together
No CFO is going to switch off a critical finance process overnight.
The sensible approach is to build the AI-enabled system alongside the current one. Both produce the same outputs while finance investigates any differences.
Once the new model delivers reliably, the old process can be switched off. Finance will lead much of the transition because the team understands the controls and knows which exceptions matter.
The opportunity for private equity
If an AI-enabled operating model works in one portfolio company, the same approach can be adapted elsewhere.
Rather than spending years untangling each company’s back-end systems through a bespoke transformation programme, firms can build a proven playbook for new acquisitions.
Over time, more standardised systems can be connected across the portfolio. Integrations become faster and process-heavy work becomes cheaper.
The early movers will have a significant advantage. I also expect plenty of M&A activity around the technology and expertise needed to deliver the transformation.
What this means for finance
There’s an obvious people impact. Some repetitive and process-heavy work will reduce.
But finance won’t become less important. It will sit at the centre of making the transformation work.
CFOs will need to identify the value and build the business case. Finance teams will design controls, test outputs and prove whether the investment is improving performance.
The day-to-day work should become more interesting too. Time spent moving information or fixing routine errors can move towards commercial thinking and transformation.
The practical starting point is to ask: What would our finance and ERP systems look like if we built them from scratch today?
Then consider how you’d run the new model alongside the old one and prepare your team to lead the transition.
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