Q3’s CFO Alliance Roundtables Flag Confidence Problem

Has an AI-assisted answer delivered by a cheeky analyst come through your door lately?

At recent CFO Alliance roundtables, finance leaders have discussed how AI is giving employees answers to workplace challenges, sometimes with enough confidence to bring those answers straight to the CFO’s office. 

Whether that confidence survives a few follow-up questions is where things are now getting interesting. 

Nick Araco Jr., founder and CEO of the CFO Alliance, sees that gap becoming a concern in conversations with midmarket finance leaders. Following the organization’s Q3 roundtables in cities including Denver, Philadelphia and New York, as well as sessions in Southern California and Nashville, he said the discussions were previously about how teams should use AI. Now, it’s about how CFOs should manage adoption already happening without their approval.

“Six months ago it was ‘should we?’ Now it’s ‘it’s already happening and I didn’t sign off on it,’” Araco told CFO Upside. Members are also questioning whether employees can evaluate the work produced by shadow AI and whether their managers are asking enough questions.

CFOs are taking steps to address unauthorized use, Araco explained. He said in one session, members developed a working AI data standard together. “CFOs aren’t waiting for permission [to establish working standards for AI use] anymore,” he said.

Cloaking a Skills Gap

Araco calls the problem the “AI Confidence Curve,” his framework for describing how users can overestimate their abilities when AI produces convincing work. The risk, he said, becomes apparent when a finance employee can deliver an analysis without understanding how to build it.

“The output is fluent, but fluent isn’t the same as right,” Araco said. “And the analyst who can’t build the variance analysis from scratch can’t tell when the AI got it wrong either.”

Araco’s CFO members have suggested to each other that with AI doing more of the work, it’s now up to the executive leadership team to take a closer look at how employees are learning. Nowadays, a finished assignment may tell a manager less about what someone understands, making a few follow-up questions very useful. 

“Confidence goes up, competence quietly goes down and nobody notices,” Araco said.

All Talk

Araco said he sees a similar communication problem in how finance chiefs assess their leadership. A CFO may believe a decision was explained clearly while employees still have questions. So his next round of sessions in Q4, which includes 21 cities in 65 days through mid-December, will ask participants to test that assumption with their own teams.

“Most of us rate ourselves as strong communicators. Few of us could prove it,” he said.

Before attending a Q4 roundtable, each finance leader will ask their team: “What’s one thing I think I’ve communicated clearly that you’re still unsure about?” Participants will bring the answers to the session, where other finance leaders will help them compare that feedback with how they rate their own communication.

Then, each participant will choose one gap to address in 2027. A fellow participant will follow up to check on their progress, giving the commitment real accountability after the session ends.

Where the Buck Stops. “And when your team stops questioning the tool and stops questioning you, errors move faster, and nobody says a word until the CEO, board or investors do,” Araco said.