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McKinley Inc.’s Approach to Flexibility

The Gumby System

Sanveer SethiGary WeintraubJoshua BloomKelsey OwensMaureen HanrahanMatt Kruer

Since 2002, Albert Berriz has taken McKinley Inc., a near 40 year old company anddoubled it in size and earnings

Executive Summary

while simultaneously increasing employee satisfaction

andreducing employee turnover. Central to this accomplishment was the introduction of the“Gumby system”. This system centers around the tenants of flexibility and positive attitude.Employees are expected to be flexible in their roles, mindsets, and attitudes while contributing toteam and company goals.Through primary research, surveys, and first hand interviews we examine why theGumby system has been so successful, how it has directly contributed to the company’s success,how management has implemented and maintained such a system, and what challenges thecompany has and will continue to face. Based on our research and analysis we are offering othercompanies recommendations when considering an implementation of a similar system.It is our recommendation that only companies with access to self motivated andinherently flexible employee pools consider Gumby. Additionally, Gumby appears to work bestin project or deal based industries. Lastly, the right management teams, culture and jobcharacteristics must be in place to ensure success. Management teams must create anenvironment that keeps employees motivated while systematic feedback being essential inestablishing attainable goals and encouraging tangible results.Founded in 1968, McKinley, Inc. specializes in solving complex real estate problems forits own portfolio as well as select clientele, and utilizing its resources to develop, structure, andexecute complex real estate transactions and deals. McKinley’s competencies include real estate

Introduction

Berriz Personal Interview, See Bibliography

See

Customer Satisfaction Survey Results

in Appendix

development, commercial leasing, apartment housing, as well as mortgage banking. Thiscomplex company currently manages over $1.2 billion in assets and consists of approximately712 team members

. McKinley’s corporate offices are located in Ann Arbor, MI with severalother offices and properties spanning the United States.In 2002, Albert Berriz took over as McKinley’s new President and CEO, ushering in aperiod of unprecedented growth and achievement at McKinley. Over just a 5-year period, Albertwas able to take the near 40 year old company and double it in size and earnings. What madeAlbert so successful was a reinterpretation and dedication to the company’s core system andvalues. While McKinley’s core mission (to invest in and manage real estate) remained the same,Albert introduced a value system centered around a “can-do” attitude, total job flexibility,customer service, and a commitment to results. One such value, flexibility, was reinforced bywhat McKinley calls, the “Gumby System”. Named after the famous malleable clay Gumbycharacter, the system was introduced by Albert to spark employee freedom, creativity, andmotivation. The Gumby mentality has since contributed to improved employee satisfaction, areduction in employee turnover, and a sharp increase in company size and profits. Our groupconsiders these results to be a direct consequence of the motivational structure inherent in the jobcharacteristics of Gumby, the integration of this system within the company culture and thestrong company leadership which has been able to manage it.McKinley considers the Gumby mentality to be the most important attribute theiremployees possess. Ultimately, what they mean by the Gumby mentality is to be as flexible aspossible when working towards a common goal. For example, an employee at McKinley mayput weeks, or even months, of time into researching or gathering data on a property prospect. If

The Gumby System – Explained (Summary of the Issue)

Company Website, See Bibliography