Enron A Model Of The Innovative Company - 1684 Words

Enron Enron began in July 1985, and its headquarters were in Houston. It started from a small regional energy supplier. However, Enron was dissatisfied with the traditional way of doing business, so it began to look toward energy security. Enron s management believed that the creation of derivative securities market for any commodity was possible, so Enron developed energy commodity futures, options, and other financial derivatives. Energy deregulation brought this company great commercial opportunities. Enron was considered to be a model of the innovative company. Because of the deregulation, it became a trader of everything from oil and gas futures to weather derivatives. They took a new strategy by setting up a â€Å"gas bank†. Later, the generation of electricity forced Enron to explore new industrial customers for its gas. From 1990 to 2000, Enron largely expanded their oversea business. In 1994, Enron began buying and selling electricity. After Skilling became the COO and Fast ow became the CFO of the company, Enron continued to implement dual strategies of expanding its trading activities and synchronously investing a lot of money in physical assets. Enron’s shares, in the late 1990s, had significantly outperformed the market even when the market fell. Maintaining the EPS brought Enron huge pressure to find new projects to invest. The chosen solution was to get some of the assets and related debt off the balance sheet. After Enron took series of actions, problems emergedShow MoreRelatedEnron : An Interstate Pipeline Company825 Words   |  4 PagesSECTION ONE : INTRODUCTION ENRON was established back in 1985 as an interstate pipeline company following the federal deregulation of natural gas pipelines. It was born from the merger of Houston Natural Gas and Omaha based InterNorth, a Nebraska pipeline company. Enron incurred massive debt as a result of the merger which led to it losing exclusive rights to its pipelines. Enron at this point had to come up with a new innovative business strategy in order to survive. CEO, Kenneth Lay hired servicesRead MoreFall of Enron1160 Words   |  5 PagesThe Fall of Enron 1. Why was Enron such an admired company prior to 2000? What innovation do they bring to the table? Be specific and support your statement with concrete information. Prior to the year 2000, Enron Company, established in the mid-80s, caused the admiration worldwide because of its fast rise of revenue both in the local and international stock market in a short period of time. Enron’s operating income in the year 2000 was stated in $100.7 billion and its after-tax net income wasRead MoreAccounting Scandals And Enron Accounting Scandal1596 Words   |  7 Pagesspecifically the Enron Accounting Scandal. First, I will be exploring the history of Enron. Then I will be going into further depth on what accounting issues Enron faced and then I will be explaining what a derivative is. 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Ethics and Integrity are two things all companies should practice and promote. When Enron was first developed that is what they set out to do, but things quickly took a turn for the worst. The name Enron is now synonymous with fraud, in one of the biggest Wall Street scandals in history. In 1985 Enron was conceived by two gas companies merging together in Houston, TX. The company began to boom in theRead MoreExecutive Office Of Houston Natural Gas1689 Words   |  7 Pages Enron was created in 1985 when Houston Natural Gas and InterNorth merged together. Houston Natural Gas was a utility company based in Houston, Texas before being taken over by InterNorth. InterNorth was a very large energy company based out of Omaha, Nebraska. They specialized in natural gas pipelines, but also were successful in the plastic industry, coal and petroleum exploration and production. In the beginning Kenneth Lay, who was the Chief Executive Office of Houston Natural Gas, becameRead MoreEnron And The Gas Pipeline Industry772 Words   |  4 Pagesits energy-trading model, Enron’s top executives fooled major financial institutions and accounting firms by hiding its losses from these new ventures within its financial statements. In the beginning, Enron was revolutionary in t he gas pipeline industry, because it took advantage of the deregulated environment. As a result, Enron could ensure their customers, gas suppliers, consistent gas prices through hedging (Healy and Palepu 2). Enron’s success with this energy-trading model built its trustworthinessRead MoreENRON and Faudulent Record Keeping Practices1369 Words   |  6 PagesIntroduction Enron went from modestly outperforming the Standard Poor’s 500 in the early 1990’s to drastically outperforming it in 1999 and 2000. In 1999 and 2000, Enron stock increased 56 percent and 87 percent, respectively; compared with to only a 20 percent increase and 10 percent decline for the index during the same years (Healy and Palepu, 3 2003). While these increases were originally attributed to innovation (being rated the most innovative company in America by Fortune), it was laterRead MoreEnron Corporation : The Largest Energy Trading Essay1131 Words   |  5 PagesEnron Corporation is the largest energy-trading located in Houston, Texas. It was founded by Kenneth L. Lay in 1985. Enron has been form through the merger between Houston Natural Gas and InterNorth Incorporation and initially named it as HNG/Inter-North Incorporation, before renames it as Enteron. In 1986, the company name has been shortened to Enron Corporation. At the beginning of the operation, Enron o nly involved in the transmission and distribution of electricity and gas throughout the UnitedRead MoreOrganizational Culture : The Smartest Guys Of The Room1649 Words   |  7 Pagesculture is one whose organization’s core values are both intensely held and widely shared. After viewing Enron: The Smartest Guys in the Room, it is obvious that Enron had not only an organizational culture that was strong, but one that was extreme and aggressive. This aggressive and strong organizational culture discouraged both teamwork and ethical behavior and in the end it only plagued Enron until it eventually collapsed under its downfall. The aggressive organizational culture started with Enron’s