“I’m the chief sheepherder.”
That’s how Jeff Skilling described his role as Enron’s CEO to me back in 2001. This was several months before the Enron empire began to crumble. I was working on a piece about the role of teaching in leadership, and I called Skilling after hearing that he spent a good bit of time teaching on the job. The interview didn’t make the cut – it was heavy on platitudes and self-promotion – but the transcript reads better now than it did then, especially in light of today’s convictions. A Houston jury found Skilling guilty on 19 counts of fraud, conspiracy to commit fraud, and insider trading, and Kenneth Lay guilty on six counts of fraud and conspiracy to commit fraud.
During the trial, Skilling said he didn’t know anything about CFO Andrew Fastow’s financial shenanigans. Before the scandal, however, Skilling painted himself as a hands-on and plugged-in CEO:
“I tend to be open. I tend to encourage debate on subjects. I’ll give you an example. We had a meeting this morning looking at a capital investment we’re contemplating. We did the typical pro forma economics — do these numbers look reasonable? Then we started asking the real questions: Why will this capital investment give us more than compensatory return? What about the market return? Who are our competitors and what are they good at? What are customers looking for, and are we good at offering those services? You want to have a deeper discussion.”
Real questions. A deeper discussion. Here was an analytical thinker who enjoyed digging for details and dissecting a deal. Well, until his multimillion-dollar defense team recast him.
More pre-meltdown Skilling: “I’m teaching problem-solving. I’m helping people identify ways to be where the competitors aren’t. Some people look at the marketplace and say what’s GE doing? Let’s do that. Here we ask what’s GE not doing that we can do?”
As far as Skilling and Lay are concerned, we now know the answer: Doing serious time at Club Fed.