A CFO drives the shift to digital

Would you close a brick-and-mortar presence in the year you marked your 120th birthday? The American Automobile Association’s Washington club did.

In 2024, it celebrated its birthday with a new ad campaign featuring celebrity rapper Sir Mix-A-Lot, a Washington native, and a live event at the Seattle Seahawks’ home field. At the same time, it made a transformative move with much bigger implications: closing AAA Washington’s 12 brick-and-mortar stores and reinvesting the savings into digital offerings and expanding its service fleet operations geographically.

CFO Carrie Wilson, who has been with not-for-profit AAA Washington since 2019 and in the CFO seat since 2021, spoke with CFO Brew about guiding stakeholders through a major operational change.

Metrics matter. Sharing metrics helped to get the board behind the decision to close the stores, Wilson said. Two or three years before the decision, she said, the analytics team, which she manages, found that “less than 4% of our [1.2 million] members visited the store on an annual basis,” she said, which wasn’t enough to justify “the millions of dollars we were spending” on them.

In the end, the board found it was “almost an obvious answer,” to close the stores, Wilson said. A trickier question was timing. The board raised the issue of whether it would be better to close them all at once or one at time. Waiting until each of the stores’ leases ran out would save the organization money. But there were nonfinancial considerations that had to be weighed as well.

People first. AAA Washington is a mission-driven organization that earns its revenue through member products, so Wilson brings that lens to her decision-making. “When you’re able to say, ‘We’re doing this for our members, we’re doing this for the club as a whole, and the whole long-term financial viability and sustainability of AAA Washington, that means something,” she said. “It’s about spending money wisely, not just growing the bottom line.”

Ultimately, the organization decided it would be better to close the stores all at once, and announce the move well in advance of shutting them.

“The member experience and the employee experience would have suffered if we had dragged it along,” Wilson said. The announcement came almost a year before the August 2024 closings and gave staff and members time to prepare for the change. The organization moved some former brick-and-mortar staff into new positions in the club, and offered them training if there weren’t jobs available, Wilson said.

Measuring success. Closing the stores brought financial gains. “The biggest piece, and the most fun for me, was unwinding any lease and doing the property sales,” Wilson said. AAA Washington had owned some of the stores for more than 30 years, during which the value of the real estate had appreciated. Wilson and her team were able to do several 1031 exchanges—a like-kind reinvestment to defer capital gains taxes.

Following the transformation, the organization tracked such metrics as member sentiment, member satisfaction, and net promoter scores. “All these have done well,” Wilson said.

But Wilson’s favorite outcome was the increase in sales per travel agent; it rose despite the complete change in how agents sold to members. Rather than meet them in stores, the agents would speak with them virtually or arrange in-person meetings. “As a CFO, that is a true measure that we’ve been successful,” Wilson said.

Board relations. Having frequent and candid conversations with the board is key to managing change, Wilson said. She stresses the need to give boards the optimal amount of information. The board should ideally be “noses in, fingers out,” Wilson said. “It’s reporting at the right level, and realizing when you need to tap them, rather than tap them all the time, but making them feel like part of it, and bringing them along in the decision.”

C-suiters should keep boards apprised of any potential issues early on, Wilson said. “[President and CEO] Heather [Snavely] and I are constantly putting little breadcrumbs along the trail as we go, and that requires good collaboration,” she said.

She also recommends coming to the board with potential solutions, not just problems. For instance, Wilson said, in recently addressing higher energy prices with the board, she always suggests fixes such as instructing the fleet not to idle vehicles or optimizing dispatching schedules.

Wilson said she and her board have developed a healthy give-and-take. “The board has given us that grace to be able to test and learn,” she said. “The commitment is we have to be willing to be transparent.”