Crisis management helps a company to cope with the sudden death of its CEO
Our client was a manufacturing business with 35 employees and an annual turnover of £3.5 million. While on holiday in Southern Europe, the CEO died. He was also the main shareholder and founder of the company.
The company needed immediate help if it was to survive the loss of its key person and continue operating.
What we did
First, we set up a series of crisis meetings at various levels, with the family, the other shareholders, the board, management and colleagues.
The CEO’s wife was now the company’s largest shareholder, and was in deep mourning for the man who was not only her husband, but also the person with whom she had worked so closely from the outset. She later decided that she wished to sell her share of the company.
At an extraordinary AGM, the other shareholders discussed what they wished to do, and decided to authorise us to form a management team to assist the board.
We produced a crisis plan for the board, laying out clearly the actions needed to ensure the company’s continued operation. Middle managers and foremen played a vital role in formulating the crisis plan.
On our recommendation, the board appointed the existing CFO as the new CEO. He was the individual with the best knowledge of the company’s assets and the difficulties likely to arise in the short term. In the meantime, the company began advertising for a new CEO.
We held a meeting with all the late CEO’s colleagues, and set up an interactive home website that they could access for information. Personal accountability between colleagues was an aspect that we implemented from the start.
The first step in drawing up the crisis plan was to map out the structure of the company, which had largely centred around the deceased CEO. We then set up a marketing plan that built upon the company’s existing market knowledge. We also conducted a market survey – an activity never previously carried out at this company.
We analysed the company’s existing sales strategy. Above all, it was noted that very little had been done in the way of sales promotion. Further, those working closest to the customer, who were often technicians, had not been taking advantage of buying signals. There had been no support agreements on the products being manufactured.
We developed a revised sales strategy and helped the company to implement it.
After some difficulties in the early stages, operatives quickly found their way into their new roles. The company now had a very clear work structure, which had not been present earlier. Staff now clearly understood the point of having a customer register, as well as how best to use it.
Within two years the number of employees increased from 35 to 55. Turnover grew by 25% in the first year and by 30% thereafter. Personal accountability between colleagues increased and was also a fundamental cause of company’s rapid growth.