Far superior ways associated with a school principal (7,5)
I believe the answer is:
streets ahead
'far superior' is the definition.
(I've seen this before)
'ways associated with a school principal' is the wordplay.
'ways' becomes 'streets' (street is a kind of way).
'associated with' means one lot of letters go next to another.
'school principal' becomes 'head' (synonyms).
'streets'+'a'+'head'='STREETS AHEAD'
(Other definitions for streets ahead that I've seen before include "Greatly superior" , "A long way in front" , "right at the front" , "vastly superior" , "Far superior" .)