Leading portfolio companies in Private Equity: the pyramid of principles for CEO Success

For CEOs, whether newly appointed or aspiring, success depends on mastering both the science and art of leadership, and aligning around a clear, shared definition of success. The pyramid of principles offers a concise, practical framework that moves from foundational capabilities to the strategic apex of value creation.

1. Foundation: the science of leadership 

The base of the pyramid is operational and strategic mastery: 

• Data-driven decision-making: transparent, real-time reporting and reliable dashboards are non-negotiable for PE sponsors;
• Capital management and scalability: disciplined capital allocation and scalable systems that support rapid growth and exit readiness;
• Execution of value-creation plans: deploying proven frameworks and playbooks against clear milestones and timelines. 

Success criteria:

CEOs key actions: Regularly review your operational dashboards and financials. Identify organisational, systems and process gaps and address them proactively.

Boards key actions: set clear, measurable expectations for operational performance and ensure the CEO has the resources to deliver. 

2. Middle layer: the art of leadership 

Above the science sits the human dimension that mobilises organisations through change: 

• Emotional intelligence and authentic communication: navigating change, managing diverse stakeholders and building resilient teams;
• Vision-setting and trust-building: inspiring belief in the company’s mission, particularly during transformation or accelerated growth;
• Deep listening and engagement: connect with employees, investors and customers to create alignment and momentum.

Success criteria

CEOs key actions: Invest in your own leadership development. Seek feedback, engage in coaching and practice authentic communication.

Boards key actions: encourage and support your CEO’s growth as a people leader. Recognise and reward behaviours that build trust and engagement.

3. Apex: the CEO success profile 

At the pyramid’s summit is a clear, shared definition of success: the CEO success profile. This is not a job description; it is a strategic blueprint that specifies the mission-critical outcomes, capabilities and behaviours required for the role in the context of a particular portfolio company.

How to develop the profile: 

• Stakeholder input: gather perspectives from private equity sponsors, board members, senior leaders and, where appropriate, key customers or partners.
• Objective facilitation: use an independent advisor to secure candid feedback and to balance power dynamics.
• Strategic dialogue: discuss priorities, risks and value levers using structured questions.
• Synthesis: aggregate feedback to identify points of divergence and to facilitate honest board conversations.

Success criteria

CEOs key actions: request clarity on your success profile and use it to align priorities and development.

Boards key actions: do not wait for a leadership transition. Initiate the CEO success profile process now. Engage an external advisor to guide the work and preserve objectivity.

Applying the pyramid: practical steps for PE-backed CEOs and boards 

1. Master both science and art:
   • Boards: evaluate the CEO on both dimensions, not solely on financial outcomes
   • CEOs: balance operational rigour with human-centred leadership. 
2. Align early and often:
   • Boards: treat the CEO success profile as a living document, update it during searches, succession planning and strategic reviews.
   • CEOs: Refer to the profile regularly to guide your actions and decisions. 
3. Leverage external expertise:
   • Boards: appoint an objective third party to challenge assumptions and bridge divergent views.
4. Invest in the process:
   • Both: Dedicate time and resources to alignment; this investment yields dividends in board effectiveness, CEO tenure and long-term value creation. 

Conclusion and next steps 

In the private equity sector the CEO role is uniquely demanding. By establishing operational excellence, strengthening human leadership and aligning around a clear, shared success profile, CEOs and boards can unlock exceptional performance and sustainable value.

Immediate actions: 

• CEOs: assess your strengths and gaps across both the science and the art; seek feedback and targeted development.
• Boards: start the CEO success profile process and commit to regular, structured alignment.
• Both: adopt the pyramid of principles as your roadmap for thriving in the high-stakes world of private equity. 

Unlock CEO success in Private Equity

Join leading investors, board members and portfolio company CEOs on 28 November for a breakfast session on mastering the pyramid of principles. Explore how to align on CEO success profiles, balance operational discipline with human leadership, and accelerate value creation. 

For event details and to confirm your participation, please contact Pieter Ebeling, Head of Private Equity Europe: Pieter.Ebeling@odgers.com.