What do you do when a key employee suddenly dies? 12 critical management actions

As a middle market-sized business owner or CEO, there’s arguably nothing worse to have to deal with than the sudden death of a key employee.  It gets worse if they are a long-term and loyal member of the team.  These folks are most often beloved by many throughout the company.


It is worse still if that person happens to have a high-profile position with strong customer relationships.  Perhaps this person is a key or top rain maker.


All of this terrible scenario is further complicated by the world we live in.  Instant access to information is both a blessing and a curse.  In the case of managing the news of the death of a key employee, it is almost exclusively the latter.

In this tragic situation, management has to act fast.  Rumors start, speculation can run rampant. Employees may panic.  And competitors will pounce on this new perceive vulnerability.   The vulnerability, of course, is something they manufacture through innuendo, feigned concern and thinly veiled expressions of sympathy.  Sadly, it works and companies lose customers.  Especially when the customer relationship is strongly tied to the personal relationship between the rain maker and the client.

Finally, as owner/CEO, the first inkling of the terrible news often arrives as rumor or speculation.  So, what do you do to manage this?  To be clear, it is something that does have to be managed.

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12 critical management actions:

  1. Make certain that you have complete contact information for your entire senior management team stored in your phone.  Cell phone and home phone numbers.  This should be done as part of an emergency management plan way in advance of any emergency.  Not at the time of one.
  2. Have an established calling tree so that your department managers know how to easily contact their key staff.
  3. Get yourself under control.  When this kind of news hits, you will likely be personally and deeply affected.  Even long term employer/employee relationships build strong emotional bonds. You may have lived through much of that employees major life events and know their family well.
  4. Move at lightning speed to get the facts and cut through the rumors and speculation.
  5. Get on the phone instantly and personally with each of your top managers to break the news and state the facts as to what happened.  Ask them to immediately call their top managers.
  6. Don’t let employees hear the news via Facebook, Twitter, Instagram, LinkedIn or a text message from some other employee.  Rightly or wrongly, many employees then see the company as uncaring, unfeeling and resent the fact that they learned such tragic news in such an impersonal way.  They may also begin to worry, speculate and spread unfounded rumors.  Many times these relate to the company’s decline or demise without the key person there.
  7. Schedule a senior management meeting first thing the next morning if the news came after work hours or immediately if the news came during the work day.  If held the next morning, ideally hold the meeting before regular work hours begin so that a full action and communication plan can be developed.  Also, this gives the management team the chance to share thoughts and feelings about the loss of this key member of the team.  This is the owner/CEO’s time to lead.
  8. Schedule a full company meeting for later that morning to again share the facts and present the plan to handle the rain maker’s clients and responsibilities.  Also, to allow members of the company to talk, ask questions and share their feelings.
  9. Divide and conquer with customer calls.  Create a script during the management meeting, give each top member of the management team a list of key customers with names and contact information.  Each manager should make immediate calls to personally inform clients about the death and explain how their account will be handled and reassure them of their value to the company and that they will be taken care of.  Every top customer should be contacted by the end of day one.
  10. Make certain to maintain an environment of accessible and open communications for employees to express their emotion.  Consider bringing in a grief counselor.
  11. Address the matter of the funeral.  If it will be held during the work week, consider communicating a policy that employees may attend at their own discretion.  Some will want to go and others will not.
  12. Consider holding a management gathering after business hours to honor and toast their lost friend, talk about the things that will be missed and share funny stories.  It’s a great part of the healing process that can boost sagging morale and allow for a quicker and more effective recovery.


Note: If you have an interesting and/or educational CEO story of Head Noise caliber, write to me at cbishop@capitusgroup.com. I’d love to speak with you and share your story in my Head Noise blog. You can tell your story either on the record or, without attribution.

Cameron Bishop is a partner with The Capitus Group. The firm provides comprehensive business value enhancement and transition strategy solutions. Partners and Advisory Directors comprise an experienced team of business professionals who have successfully owned, run, grown and sold companies. Capitus utilizes proven value enhancement and risk reduction techniques to enable superior transition options.



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