Last month, I attended NAHB’s midyear meeting in Miami and had the pleasure of sitting in on a presentation by Daniel Swift, president and CEO of Des Moines-based architecture group BSB Design.
Mungo Homes: More Than a Family Business
Irmo, S.C.-based Mungo Homes scored an NHQ award on its very first try, which almost never happens. Read on to learn what played a big role in Mungo Homes' quality success story.
Mungo Homes has historically led the Columbia, S.C., market, but being the biggest builder in town is not the goal.
"Our business plan is to grow as opportunities arise, without sacrificing our core values or performance," says Chris Condon, division president of Mungo's corporate office, in Irmo, S.C., near Columbia.
Steven, Left, and Stewart Mungo are co-owners of Mungo Homes. They took over the business from their father, Michael Mungo, whose portrait is in the background.
Those values include working hard while putting family first; having high professional, ethical and personal standards; and practicing teamwork and unselfish dedication.
"It all boils down to being the kind of person that your mama raised you to be," says Lee McLoud, division president of Harbor Homes, Mungo's Charleston, S.C. office. "That's very much the culture around here."
Founded by Michael J. Mungo in 1954, the company has built more than 9,000 homes and 20,000 home sites. Sons Stewart and Steven Mungo are current principals of the company. In addition to heading up the corporate office, Condon overseas Mungo Construction, the general contracting arm that does business with government agencies and private developers around the state.
Mungo has enjoyed impressive growth over the last few years. Company closings increased 77.5 percent between 2003 and 2006 — helped by the opening of Harbor Homes in 2005. And in 2006 when most of the housing industry was suffering through a significant sales slump, Mungo had its best year in company history.
"Our market diversity, sound fiscal practices and steady government work have kept a softening market from adversely affecting our bottom line," says Condon.
And Mungo tops off this year with winning an NHQ Silver Award on its very first try — a rare achievement.
Mungo's staff knows what their capabilities are as builders, and they stick to what they do best. The company tried to accommodate special customer requests but recognized customer satisfaction and profitability dropped dramatically. They are better at building standard plans with standard options.
"If someone wants to buy a home from Mungo or Harbor, we have a very wide variety of options, and you can make a very customized home within the predetermined, pre-priced, pre-drawn, pre-estimated, pre-contracted list," Condon says.
"We are not a custom home builder," he adds. "We don't want every customer out there; we want the ones that will be happy in our system. And there are plenty of them."
The informal motto around the office at Mungo Homes is, "We don't hire you; we adopt you."
Condon says satisfaction and well-being at work are much more easily achieved in a family-type environment and adds that Mungo's turnover rate — at .44 percent a month — is an eighth of the industry standard of 4.9.
"We don't lose people to the competition," says Condon.
People are valued, but prima donnas are frowned upon. McCloud says his employees have seen him dig ditches, sweep houses and clean bathrooms, and that Steven Mungo has "done things you wouldn't think a typical company owner would do." The hiring process is designed to weed out people who don't share this team-oriented, "we're in this together" attitude.
Multiple interviews and personality appraisals ensure only skilled people who fit Mungo's corporate culture get hired. For key management decisions, several staff members review the candidate.
"Everybody convenes afterward and trades notes," Condon. "Some people see one thing, other people see another. It helps us get a real good read on them."
The company recognizes and rewards excellent performance. Recognitions given at quarterly company breakfast meetings provide an opportunity to publicly acknowledge good work. The company liberally doles out to employees free trips and tickets to South Carolina sports team events. For working tirelessly to finish a job on time, the entire government division got rewarded with a trip to Costa Rica.
"And we basically gave all the field guys a month off when they were through," says Steven Mungo. "I told them, 'Go away for a month. You'll get your paycheck. Just cool your jets and go do something fun.'"
The Columbia office is where most business functions — estimating, marketing, accounting, human resources, purchasing, etc. — are centralized. The divisions share resources. "That allows us to move assets around as needed and prioritize them where we need to bring forces to bear at a particular moment for maximum impact," says Condon.
The Charleston office had 184 closings and turned a profit in 2005 — its first full year of operation. "That's when we started getting excited and thought that maybe we've got something here," Condon says.
At the Charleston office, there are four employees who work with estimating, accounting, permits and closings.
"Otherwise, everybody else is out in the field building houses," says McLoud. "You could do up to 300 closings with that same nucleus."
Most business activities at the company have processes that have been carefully crafted and refined as needed. Employee stakeholders have the opportunity to provide input and feedback so that no critical element is overlooked.
The Mungo Homes Team
"By the time we implement a process, everybody has had a part in creating it," says Condon. "For that reason, we don't have too many people trying to get around the rules."
Mungo's overall vision includes what Condon calls "an absolute, total commitment to overall quality."
"We only hire people with the commitment to get better everyday," says Condon. "Even though we just won the [NHQ] Silver Award, there's not a single person who is satisfied with what we're doing here today."
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