The death of an employee is analogous to the common metaphor of a stone dropped into a pond. When a stone hits the water, it causes ripples that spread out from the point of impact. As the ripples reach further out into the pond, their size and effect diminish until they are barely perceptible. Similarly, when an employee dies, that part (group, department, etc.) of the organization closest to the employee is affected the greatest. The further away from that deceased’s department/group/etc., the less the overall impact is.  Extending the metaphor further, the higher in the organization the deceased was, the bigger the “stone,” the greater the initial “splash,” and the more far-reaching the “ripples.”

After the death of a key employee, management’s attention needs to be focused in two directions: support for the affected employees, and development and execution of a tactical plan to reduce the impact of the loss on the operations of the organization.  Support for employees includes providing appropriate counseling as discussed in Personnel Matters.  A plan for getting the operations of the company back to normal could have a number of aspects.  The plan should at least consider any financial and/or physical safety fears of the employees; what and how the organization will communicate with outside interested parties such as customers, vendors, lenders, shareholders, regulators, the press, etc.; and if the responsibilities of the deceased will be continued, discontinued, or re-assigned.   Depending on how large the "stone" is and far-reaching the "ripples," other considerations might also need to be addressed.