Deloitte’s Finance Trends 2027 report surveyed 1,434 leaders at companies with $1 billion or more in revenue and asked how they most often approve large AI and technology investments. 23% said executive or board mandates, with no measurement process behind them. Among North American respondents, it was 28%. Only 25% use a formal capital approval process that requires quantified ROI and a business case. (Deloitte, September 2026: https://www.deloitte.com/us/en/insights/topics/leadership/finance-trends-leadership.html)
A mandate is not a criterion. It is a preference with authority behind it. When the largest investments of the year are approved because the right person wants them, the approval process measures influence, not return. The request that wins is the one argued hardest, by the person with the most political capital, in the meeting where the budget got decided. Nobody records that as the reason. It surfaces a year later as a capital plan that does not match the strategy it was supposed to fund.
Concept 2 is where Pillar 4 of the Enterprise Value Playbook, Finance + Capital, turns visibility into decisions. Concept 1 asked whether leadership can see margin, cash flow, and leading indicators in time to act. This concept asks what leadership does with the capital those numbers reveal. It inherits everything before it: a documented strategy, accountable leaders, documented processes, an integrated stack, and numbers leadership trusts. Without a documented strategy, there is nothing to score a capital request against except the person making it.
YOUR BIGGEST 2027 BET HAS A SPONSOR. DOES IT HAVE A CASE?
Most capital plans are last year’s run rate plus whatever the most persuasive executive asked for. That produces a budget. It rarely produces enterprise value.
This fall I published a piece on why a budget should be a decision about what the company is trying to become, not a forecast of what it will spend: https://tipofthespearventures.com/from-budget-to-enterprise-value-how-leaders-should-approach-budget-season/
Before your 2027 plan goes to the board, I will run one Capital Allocation Review with your leadership team. You leave knowing where your capital is compounding and where it is habit. If we do not find at least one line you would fund differently, you have lost one hour.
I am holding a limited number through December, while 2027 plans are still open. Reply “Capital Review” to reserve one.
THE PRINCIPLE
This week’s concept sits in Pillar 4, Finance + Capital: capital goes to the high-ROI initiatives tied to your growth strategy, not to whoever asks loudest.
Where You Stand
Pull the largest capital decision your leadership team approved last quarter. In one paragraph, write the ROI case that justified it and the strategic bet it served. In a second paragraph, write down who argued for it and how hard. If the second paragraph was easier to write than the first, that is your actual score.
The Failure Pattern
Capital gets allocated to whichever initiative made the most noise in the last leadership meeting, rather than the initiative with the strongest ROI tied to the stated growth strategy. Requests get approved on a first-come basis or on internal political capital rather than consistent evaluation criteria.
Kotter’s Step 3, Form a Strategic Vision, is the connective tissue. Capital allocation criteria that are not explicitly tied back to the documented strategic vision will drift toward whoever argues loudest. The vision has to be specific enough to actually score a capital request against, not so general that any initiative can be argued to fit it. The move: build explicit ROI-tied evaluation criteria for capital requests, connected directly to the strategic bets documented in Pillar 1. Every capital request gets scored against those criteria before approval, regardless of who is asking. Before the 2027 plan reaches the board, score its largest line items against those criteria and count how many still clear the bar.
The Win Condition
Every capital request, regardless of size, is evaluated against the same explicit criteria. Leadership can explain the ROI logic behind the last quarter’s largest capital decision without hesitation.
FROM THE CHAIRMAN
“Walk me through the ROI case for the largest capital decision you made last quarter. If the honest answer involves who argued for it hardest, this board has a capital discipline problem, not a capital shortage.”
MARKET INTELLIGENCE
Three signals from this week across Venture Capital, Private Equity, Family Offices, and Capital:
Truelink Capital / Johnson Controls. Truelink Capital signed a binding agreement to acquire Johnson Controls’ global intrusion products business, including the DSC, Qolsys, and Visonic brands, and will run it as an independent company. Johnson Controls has been reshaping its portfolio around building solutions. Terms were not disclosed. (Security Info Watch, October 27, 2026: https://www.securityinfowatch.com/alarms-monitoring/alarm-systems-intrusion-detection/news/55414591/johnson-controls-to-sell-intrusion-business-including-dsc-and-qolsys) My read: A carve-out is a capital allocation decision made in public. Johnson Controls decided its next dollar compounds faster somewhere else. Truelink made the opposite bet, committing to fund new panels, sensors, and engineering capacity the parent was not going to prioritize. Same asset, two capital plans. Both boards face the same test this week’s Win Condition sets: can leadership explain the ROI logic behind the decision without hesitation?
Michal Strnad / Delfin. Czech billionaire Michal Strnad has offered €30 billion for Delfin, the Del Vecchio family holding company and key shareholder in EssilorLuxottica, two people close to the matter told Reuters. Delfin is owned equally by eight heirs, and a sale would require near-unanimous agreement. (Reuters via Global Banking & Finance Review, October 29, 2026: https://www.globalbankingandfinance.com/czech-billionaire-strnad-offers-30-billion-essilux/) My read: Eight owners, one balance sheet, and no single person who decides where the capital goes. Reuters describes the heirs as increasingly at odds. When owners do not share a documented vision for their capital, the decision drifts toward whoever argues loudest, or it stalls until an outside offer forces one. A family holding company that intends to stay in the family needs criteria the next generation agreed to before the offer arrived.
HSBC. HSBC announced a new share buyback of up to $1 billion with its third-quarter results. Pretax profit rose 32% to $9.63 billion, but revenue of $18.62 billion missed expectations and the shares fell 5.5% in Hong Kong. The bank is scaling back selected international businesses to focus on Asia and the UK. (finews.com, October 27, 2026: https://finews.com/news/english-news/74169-hsbc-reports-significantly-higher-third-quarter-earnings-share-buyback-stock-falls-5-5-percent) My read: A buyback is a statement about return. It tells shareholders that management sees no better use for that dollar inside the business right now. HSBC is exiting markets to concentrate capital where it believes returns are strongest. The market heard the revenue miss. The discipline being tested is whether capital freed by every exit gets scored against the strategy, or simply returned because no internal request made a strong enough case.
SAM SPEAKS
Recently I delivered “The Unrealistic Leader: Achieve Real Results by Being Unrealistic” to members of a professional association and a podcast. I speak to executive audiences on three core topics:
Scaling and Exiting the Business for Maximum Value. The leaders who capture maximum value at the table treat the exit as a strategy, not an event.
The Unrealistic Leader. The most dangerous thing a leader can do is become reasonable too early.
The Price Pressure Playbook. Buyers have a playbook. This talk gives sellers the 20 moves that counter it.
If your professional association or an upcoming conference is building its agenda to close out 2026 or plan 2027, let us connect: speaking@tipofthespearventures.com
FROM THE TIP OF THE SPEAR
Twenty-three percent (23%) of leaders in Deloitte’s Finance Trends 2027 survey said executive or board mandates, with no measurement process, are how they most often approve large AI and technology investments. Twenty-five percent (25%) require quantified ROI and a business case. The largest bets of the year are being approved on authority nearly as often as on evidence.
Where capital goes is the strategy. Everything else is the plan. Discipline means one set of criteria, tied to the documented growth strategy, applied to every request regardless of who is asking. It holds only when the vision is specific enough to say no to a request that sounds strategic and is not.
Each of this week’s capital moves put that discipline on display. Johnson Controls decided an intrusion business no longer fit its portfolio, and Truelink decided the same business deserved new investment. Eight Del Vecchio heirs are weighing a €30 billion offer without a shared view of what their capital is for. HSBC chose to return $1 billion to shareholders in the same quarter its revenue missed. Each decision will be judged on the case behind it, not the conviction of the people who made it.
Year-end is when the 2027 plan gets approved, and approval is where capital discipline holds or breaks. Ask the Chairman’s question this week: Walk me through the ROI case for the largest capital decision you made last quarter. If the honest answer involves who argued for it hardest, the 2027 plan will repeat the pattern at a larger number.
100% GUARANTEED.
Executive Performance Coaching for CEOs and senior leaders who are scaling something real. We define the results in writing before we start. If you are not satisfied with them, you do not pay.
DO NOT PAY ME UNLESS YOU GET RESULTS.
Reply “Coaching” or reach me directly: sp@tipofthespearventures.com
UNTIL NEXT TUESDAY
From the Tip of the Spear is my weekly publication for executives who are building something real. One issue, every Tuesday. A field report from active operator engagements, one principle with supporting data, and market intelligence from across my VC, PE, and family office network.
