Enron is a fascinating study for people who are serious about living their faith in the workplace. You remember Enron? It’s the company that was in the news in late 2001 for filing bankruptcy as the result of a spectacular accounting fraud. Thousands of people lost their jobs and their retirement savings, as a result.
I have just finished reading a couple of books about Enron: Loren Fox’s Enron: The Rise and Fall, and the acclaimed The Smartest Guys In The Room: The Amazing Rise and Scandalous Fall of Enron by Bethany McLean and Peter Elkind. There is a lot to be learned about behavior in a corporate environment from these books. With this post, let me cite just one example.
Here’s how McLean and Elkind describe Kenneth L. Lay, Enron’s leader from its founding in July 1985, right through its Chapter 11 filing in December 2001.
Just as [Lay] wanted outsiders to see him as a good and thoughtful man, he wanted Enron employees to see him the same way. He was the keeper of Enron’s “vision and values,” which Lay later defined as “respect, just treating other people the way we want to be treated ourselves; integrity, making sure that we do have absolute integrity, we’re honest, we’re sincere, we mean what we say, we say what we do…” In one memo sent to staff, he wrote, “As a partner in the communities in which we operate, Enron believes it has a responsibility to conduct itself according to certain basic tenets of human behavior that transcend industries, cultures, economics, and local, regional and national boundaries.” He added that “Ruthless, callousness and arrogance don’t belong here… We work with customers and prospects, openly, honestly and sincerely…”
But at the very top of the company, the handful of insiders who dealt with him regularly had a hard time taking all this seriously – in no small part because Lay’s own actions at times belied his stated creed. He rarely said something difficult to an underling, because he hated unpleasantness. The result was that his key executives found that he could be deceitful, willing to say things that just weren’t true in order to keep people from getting mad at him…” [chapter 7]
Lots of companies have a vision and values statement. How many of the companies live up to those stated values? Probably only a small percentage of them, but I bet the ones that do have a great example in their leader. If you work at a company with such a statement, it is part of your job to uphold the statement. That is a hard-enough job even with a stellar example from the management ranks above you, but if you don’t have that example, it is very difficult to take a company vision and values statement seriously.
It is interesting that in this case, Lay’s failure to live up to his own values statement is the result of his desire to avoid conflict. He didn’t like unpleasantness. Well, no body likes it, but a real leader isn’t worried about doing what’s pleasant; a real leader is concerned about doing what is right.
So the bottom line lessons here are:
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If you are going to publish a statement of values in your company, take it seriously. Be prepared to live by what you say.
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Understand that you have to set the example for that statement to the employees around you. No matter what rank you hold in the company, someone is watching you and they will adjust their own effort for living those values according to the extent they see you living them.
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Sometimes you have to do things that are unpleasant, like deliver bad news, tell someone something they don’t want to hear, accept an unexpected expenditure, etc. If you do what’s right, you have a better chance of being respected. If you focus on being liked, you will be more easily swayed away from doing what’s right, and ultimately far fewer people will respect you.
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