As a CPA, I’ve always been fascinated by the Enron disaster, so I had to pick it up.
In school, I’d always learned that the scandal was bad, but this book really got into the details.
Here are some business lessons from what Enron did wrong (outside of the clear fraudulent behavior):
Enron’s expenses were out of hand - they had private jets, huge bonuses, and expensive consultants.
Compare this to Amazon (which was rising during Enron’s fall). Amazon has a famous culture of frugality - they didn’t let their executives fly business class for years.
Frugality is key to business building.
Enron thought that its initial success meant that it could dominate any business.
While it’s ok to cautiously experiment in new businesses once you have a solid footing, Enron was spending billions on uncertain business lines (i.e. trading broadband).
Focus on your core business.
I’m as optimistic about the future of technology as any.
But, that doesn’t mean everything with your business will pan out exactly how you expect.
Enron would plan the future as if nothing would ever go wrong.
In summary, don’t be Enron.