Enron

Enron Mission. Vision. Values.Enron stands on the foundation of its Vision and Values. Every employee is educated about the company's Vision and Values and is expected to conduct business with other employees, partners, contractors, suppliers, vendors and customers keeping in mind respect, integrity, communication and excellence. Everything we do evolves from Enron's Vision and Values statements.MISSION "We treat others as we would like to be treated ourselves....We do not tolerate abusive or disrespectful treatment. Ruthlessness, callousness and arrogance don't belong here."

VISIONEnron's vision is to become the world's leading energy companycreating innovative and efficient energy solutions for growing economies and a better environment worldwide.Enrons ethics code was based on respect, integrity, communication, and excellence. These values were described as follows:

Respect. We treat others as we would like to be treated ourselves. We do not tolerate abusive or disrespectful treatment. Ruthlessness, callousness and arrogance dont belong here.Integrity. We work with customers and prospects openly, honestly and sincerely. When we say we will do something, we will do it; when we say we cannot or will not do something, then we wont do it.Communication. We have an obligation to communicate. Here we take the time to talk with one another . . . and to listen. We believe that information is meant to move and that information moves people.Excellence. We are satisfied with nothing less than the very best in everything we do. We will continue to raise the bar for everyone. The great fun here will be for all of us to discover just how good we can really be.

Culture of arrogance that led people to believe that they could handle increasingly greater risk without encountering any danger.Enrons corporate culture did little to promote the values of respect and integrity. These values were undermined through the companys emphasis on decentralization, its employee performance appraisals, and its compensation program.

Each Enron division and business unit was kept separate from the others, and as a result very few people in the organization had a big picture perspective of the companys operations. Accompanying this emphasis on decentralization were insufficient operational and financial controls as well as a distracted, hands-off chairman, a compliant board of directors, and an impotent staff of accountants, auditors, and lawyers.

Performance evaluation process for all Enron employees. Known as rank and yank, (are si Gladwell in articol despre asta)

Enrons compensation plan seemed oriented toward enriching executives rather than generating profits for shareholders

Core/specific goalCORE GOAL: To prevent Enron from bankruptcy by proposing a strategy that can accomplishes Enrons objectives through ethical practices

StrengthsWeaknessesMarket positionTrust from the investorsHuman capitalInnovative companyEntrepreneurshipFlexibility to market conditionsCompetitive environment

Culture of arrogance Lack of transparencyShort term focusUnethical top managementMarket to market approachPartnershipsMerit over hierarchyAccepting failure as price of innovationSink-or-swimLack of control in entrepreneurshipFormal communication- knowledge sharingCompensation structure

OpportunitiesThreatsSupply of high quality energyRenewable energyBusiness merger and acquisitionMarket development in Asia

RegulationCompetitionTerrorist threats

Porter Five forces modelThreat of new entrants LOW Barriers to entryEconomies of scale YESProduct differentiationNOCapital requirementsHIGHSwitching cost to buyersLOW?Access to distribution channelsLOWOther cost advantages NOGovernment policiesHIGH?Incumbants defense of market shareHIGHIndustry growth rate HIGH?

Determinants of Supplier PowerSupplier concentrationAvailability of substitutes inputsImportance of suppliers input to buyer HIGHSuppliers product differentiation Importance of industry to suppliersHIGHBuyers switching cost to other inputHIGHSuppliers threat of forward integration LOWBuyers threat of backward integration LOWDeterminants of Buyer Power LOW Number of buyers related to selersHIGHProduct differentiationLOWSwitching costs to use others product HIGHBuyers profit margin?Buyers use of multiple sourcesLOWBuyers threat of backward integrationLOWSellers threat of forward integrationLOWImportance of products to the buyerHIGHBuyers volumeHIGHThreats of substitute products Relative price of substituteHIGHRelative quality of substitute LOWSwitching costs to buyersHIGHRivalry among existing firmsNumber of competitors (concentration)Relative size of competitors(balance)Industry growth rateFixed costs vs. variable costsProduct differentiationCapacity augmented in large incrementsBuyers switching costsDiversity of competitorsExit barriersStrategic stakesStrategy