There are a lot of positives that come from being a legacy company—an established consumer base, loyal workforce, and name recognition, to name a few. But 150-year-old automotive services company Valvoline had to revamp its business to stay competitive, which came with growing pains.
At Fortune’s Most Powerful Women Summit on Tuesday, Valvoline CEO Lori Flees discussed how she uprooted the leadership and structure of the business while holding onto tenured workers. More than 40 years ago, Valvoline started selling services to accompany its product offerings and help consumers maintain their vehicles. The offering was majorly successful, and became a part of the DNA of the legacy brand. But 18 months ago, the company decided to sell the product business to focus on retail services. This fundamentally changed Valvoline’s operations.
“Attrition does happen, and when we announced the separation of the product business that we were going to sell, there was a period of uncertainty,” Flees said. “A lot of folks were unclear on the future of the company, and we had people leave. Some of them went to follow my predecessor at his retail organization.” Before she snagged the corner officer, Sam Mitchell led the company between 2016 and 2023.
In a similar vein, Terry Rasmussen, president and CEO of financial services organization Thrivent, said the 121-year-old organization has geared its efforts at modernization with a focus on keeping what works at the core of the business, while advancing strategically in the meantime. To execute on its modernization initiatives, the Fortune 500 company—with $179 billion in assets under management—assessed where it excelled and distilled three factors. First, Thrivent drives impact on local communities by engaging both employees and clients in its corporate citizenship efforts. In fact, driving impact at the local level is its "secret sauce," Rasmussen noted. Second, Thrivent delivers value to both the firm and its clients through its investment professionals, doubling its dividend to members in recent years.
"Delivering value is something that we really do well, and we've got to make sure that we continue to do that," said Rasmussen.
A third pillar to Thrivent's performance is its skill at maintaining relationships between clients, Thrivent itself, and clients' advisors.
"What really sets us apart from other financial services companies is our deep relationships with those that we serve," said Rasmussen. "Those three things are core to who we are and we actually have to keep them at our core."
Therefore, modernizing for the next generation has to work in tandem with maintaining relationships with previous generations that are still a critical part of Thrivent's business, she said. Part of that involves telling the company's story more clearly, added Rasmussen, who took on the top role in 2018 as the company's first-ever woman chief executive.
Meanwhile, at Valvoline, Flees as focused in part on making major changes to company leadership. When stepping into the role as president of retail services in 2022, it was commonplace that most executives and frontline workers had dedicated their careers to Valvoline. Many were promoted internally, so employees had stayed and worked their way up through the company for decades, she recalled.
But a revamp was needed, and selling the product business was one component of bringing the 150-year-old brand into the future. Flees appointed 30% of the business’ leadership from the outside, drawing people in with professional backgrounds at McDonald’s, Amazon, and Walmart with fresh perspectives.
But this made employees feel as if the possibility of internal promotions were being bulldozed, and so some left. Flees recognized the commitment, knowledge, and dedication of these workers who may have spent upwards of 30 years at the organization, so she honored their departures instead of shaming them.
“The most important thing that we did differently is we celebrated people,” she said. “Even though they had decided to leave, we celebrated what they had contributed, and we had a ‘thank you’ and celebration, and we just really raised up the fact that they had given the company so much already, and we were sad they were leaving.”
How Valvoline ended up retaining employees
Flees points to three specific ways she recognized departing workers that convinced some to stay or return to the company.
Every month, her leadership team hosts a lunch for career milestones, celebrating Valvoline workers who have spent five, 10, 15, 20, or more years at the company. And for corporate employees, Flees sends each staffer a personalized note on their work anniversaries to thank them for their service to the company. It’s tailored to their individual role and team function, and these small personal flourishes create a big impact when they’re coming from the company’s chief executive.
“That makes people feel seen and valued, regardless of where they are in the organization. That has given me so much joy, because then I hear their stories around how they came to the company, while they’re still there,” she said, adding that it could even be the move that convinces them to stick around.
“Or it hits them at the right time, ‘Oh my gosh I can’t believe the CEO sent me an email.’ Because they’re at a point of challenge,” Flees said.
Flees also stays in touch with people who are thinking about or preparing to quit, and picks their brains as to why they’re leaving. And in some cases—like with the head of store operations, who she desperately wanted to keep on board, and did—it was this tactic that pushed them to stay at Valvoline. She said it showed that the CEO cared, and actually wanted to receive constructive criticism. This also convinced people who had left the business to return to their roles.
Whether an employee was looking to retire or separate from Valvoline, Flees would ask questions like “Can I have some time, can I get your feedback, can I get your advice?” By digging a little deeper, she said she was able to change their minds and keep them.
While Flees explained these leadership and structural changes were necessary to modernize the legacy brand, keeping a good mindset about attrition was ultimately what saved the loyal workforce. She said the typical corporate mindset toward staffers who quit—that they’re losers or traitors—isn’t a healthy perspective, because you will eventually see that worker again. It’s best to end their stints on a high note, and focus on what they brought to the company, not what they’re leaving behind.
“You have to celebrate what they’ve given you,” she said. “Because they were a part of the journey to getting the company to where it was.”
