This is Challenge #16 and it is a little appreciated challenge that shows up in Stage 5.

There are two distinct aspects to this challenge and in too many cases our CEOs and our managers don’t handle this challenge as intentionally as they should, leaving room for rumors to run rampant. You need to first help your CEO/Manager figure out how to handle the news that a key employee is leaving. There can be a shock factor when a rock star employee, a critical member of their leadership team, suddenly walks into their office and announces he/she is leaving. The second is to figure out a process to manage all of the knowledge that employee has inside his/her head. There must be a system to hand-off the information, projects, and clients. This is where you can help your CEOs/Managers address this inevitable event during training, and help protect the company when people leave.

Why does this challenge show up in Stage 5? By now, there are capable leaders who work as an integrated team. Your CEO has more time to strategize where his/her company is going and what the next steps are to get there. So, when someone on their leadership team decides to pull up roots and move on, it’s a big deal; a much bigger deal than in an earlier stage of growth. Anyone on a leadership team has absorbed a vast amount of knowledge through extensive teaching and training. They’ve learned to take charge of and be held accountable to expanding sales processes, forecasting predictions, and key performance indicators. Every business owner has to face the day when a great employee decides to leave. Chances are that employee was someone who worked well with clients and the internal team, came to work with a positive attitude, and knew the company’s product or service inside and out.

Often, it doesn’t make much difference if the person gives plenty of notice and time to prepare or if they leave within days. The impact of a great employee leaving sends ripples across the entire organization and has huge ramifications on your clients. I ask my clients all the time: Do you have a plan for when Sandy Superstar leaves? I usually hear a response along these lines: “Oh, she’ll never leave! She’s so happy here and she loves what she does. She would tell me if she was unhappy and plus, I pay her a lot of money!”

Then Sandy Superstar announces she’s leaving. And the company is hurled into a panic. People start spreading rumors about why Sandy’s leaving. Someone has to step in to pick up the workload and management has to get the job posted right away! This Cost of Lost Expertise when an Employee Leaves is similar to another of the 27 Challenges, Employee Turnover. Regardless of the systems a company has in place, employee turnover is a reality. How it is managed is a test of how well your CEO “walks the talk” regarding the organization’s culture.

When employees leave, the loss can be seen in three critical areas:

  1. Impact on other employees
  2. Impact on the bottom line
  3. Impact on productivity

Here are 7 Steps to help your CEOs/Manager handle the fallout:

  1. Make it clear the person is valuable, and you want them to stay. This should be an immediate reaction to a resignation for someone you want to save. Ask: How can we save you? Why are you really leaving? Specific questions lead to honest feedback. Are there any active or immediate steps you can take to keep the person? Show them that you care and you want them to stay. Reinforce the fact that losing them is a great loss to the company.
  2. Think it through, and do it quickly. Every action has an equal and opposite reaction. When you get big news, you have to make big plans, and fast. Don’t get bogged down by emotion. Immediately, start thinking about the next steps.

  3. Get data and input from as many stakeholders as possible. As soon as possible, notify important stakeholders. Don’t just leave voice mails. Find the people who need to be notified and talk to them in person or in a follow up phone call. Face-to-face meetings, when feasible, have more of an impact on the stakeholder. Plus, it’s an opportunity to talk though what’s going to happen, how it will affect the company, and how much you rely on them to be an important part of the plan to move forward.

  4. Don’t make snap judgments about replacing this person. As your company evolves, so do the job descriptions of the departing employee. Take time to evaluate the role the departing employee filled and ascertain if this role has changed since he or she was initially hired. Compare those needs against the existing employees’ capabilities, and only then determine how the role should be defined, who should fill it, and when. It’s better to make the right decision than a fast decision.

  5. Each employee reacts differently to the news of co-workers leaving. Your job is to listen to their concerns. Do NOT ignore the impact of the departure and assume people are okay. Respond to those concerns quickly and authentically. How will you manage the transition? What about the other members of the team? What is the plan? As the CEO, include yourself in that plan so your employees see that you are in control, which will lessen the rumor mill and allay fears.

  6. Communicate the departure company-wide as soon as possible. Don’t let rumors spread. It’s imperative that the person leaving be able to make the announcement. It’s also important to be candid with your employees. Be clear that the departure is unwanted, change is unavoidable, and you have a solution to make it through the turbulence. Sometimes, emotions run high when good employees leave. Take the time to validate people’s uneasiness, answer questions. Communicate the company’s plan on how it will deal with this resignation. Send a consistent message to the entire company as quickly as possible.

  7. Conduct an exit interview. Give the employee the chance to say what they may have been too afraid to say before including ways you can improve as their boss. Discuss things you can do more of, less of, or modify.

Many CEOs rarely plan for the departure of critical employee. Succession planning must be part of a company’s yearly strategy sessions. Help your CEOs encourage their managers to intentionally groom key people for more responsibility. Show them the value in helping others succeed. One of my favorite quotes from John Maxwell’s book, The 21 Irrefutable Laws of Leadership reminds us: “Only if you reach your potential as a leader do your people have a chance to reach their potential.” If managers are focused on helping others grow, it will be less disruptive to fill a void when a key employee leaves. Helping each employee improve their skills isn’t a one-time event; it’s part of a culture of responsibility.

Starting on page 228 in my Stage 5 book, Leadership Integration: How To Cultivate Collaboration From the Top Down with 58 – 95 Employees, you’ll find ideas for Three Steps to Capture Critical Data to ensure valuable knowledge doesn’t leave when that key employee leaves.  You can get your Stage 5 book at

Your Success. My Passion.

Laurie Taylor, FlashPoint!