C O R P O R A T E

• Day In The Life: Enron Capital Trade Resources Is Entrepreneurial To The Core by Amy McAuliffe and David Zinn, MBA1s
• Day in the Life: Johnson & Johnson, by Glenn N. Balian
• Day In The Life With: ...O-S-C-A-R M-A-Y-E-R by Ruby Chang and Alisa Lask, MBA1s

Day In The Life

Enron Capital Trade Resources Is Entrepreneurial To The Core

The "E" in Enron stands for much more than energy. Try entrepreneurial, enthusiastic, empowering, and exciting. Our day at Enron Capital Trade Resources (ECT) provided us with the opportunity to learn about an extremely interesting and forward-looking company.

ECT is the brainchild of ex-McKinsey Global Energy Managing Director, Jeff Skilling. In 1989, Skilling recognized that deregulation in the gas industry offered significant trading and financing opportunities for Enron Corporation, a leading energy producer and gas transmission provider. Over the past 7 years through the creation of ECT, Skilling has created a multitude of energy related businesses involving sales and trading, project financing, risk management, portfolio management, and corporate development. Today, ECT is the largest buyer and seller of natural gas and power in North America.

Michigan alumnus, Geoffrey Allen, an associate in ECT's Retail Power & Gas group was our host during a tour through various ECT functional areas including risk management, retail services/marketing, corporate finance/treasury, and sales & trading.

Risk Management

Do you like to hedge your bets? Well, ECT manages the world's largest portfolio of natural gas and energy risk management contracts which do just that for Enron and other energy clients. ECT created the market for gas futures in 1991 when deregulation brought substantial price volatility to the market and created the need for hedging. With deregulation now taking place in power, ECT is creating a similar (and potentially much larger market) for electricity futures. ECT's substantial knowledge of the energy business combined with its ability to take physical delivery on futures contracts provides the company with a competitive advantage over the traditional investment banks.

Retail Services/Marketing

Interested in consulting or marketing? ECT's retail services/marketing group has elements of both. Our visit here included a live "case" discussion with an ECT manager who asked our input on an actual client's RFP (Request for Proposal) for an energy saving/cost reduction plan. The first area of concern was the identification of the client's main cost drivers. Next, we needed to fit ECT's core strengths into a plan of action that would provide value to the client. "Quick on your feet" skills were required in order to keep up with this energetic ECT manager.

Our "case interview" was followed by a presentation by two ECT associates who described a project they recently undertook to determine the drivers of forward pricing in the retail electricity market. The project was similar to studies performed by outside consulting firms and will be important as Enron formulates its strategy for entry into the retail electricity market.

Corporate Finance/Treasury

For those interested in Wall Street-like finance activities without the hassle of living in New York, one of ECT's corporate finance areas may be for you. In power and gas, Enron competes actively with the major investment banks and LBO (Leveraged Buyout) shops for project financings, private equity investments, private placements and mezzanine financings. For instance, last year ECT raised a billion dollar fund with the California Public Retirement Fund for investing in the energy industry. On the treasury side, ECT raises billions of dollars of financing from banks and institutions for both its parent, Enron Corporation, as well as for various other ECT-related entities.

Sales & Trading

ECT's sales and trading operations offer further opportunities for those looking for a Wall Street-like work experience outside of New York. We had a chance to speak with a number of traders on ECT's gas and power trading floors at the end of another frantic day of trading. We learned that ECT is a dominant player in buying, selling, transporting, and storing natural gas, power, crude oil, and natural gas commodities. The company is also the world's largest power marketer.

Overall, we were very impressed with the people and opportunities found at ECT. The company maintains an entrepreneurial environment filled with smart, energetic, and fun employees. The opportunities to learn and add value to the bottom line are endless. We also liked the collegial atmosphere that provides New York-style finance in a more relaxed environment, surrounded by interesting, well-rounded colleagues. With ECT's presence at the forefront of the deregulating retail gas and energy markets, the company also presents interesting opportunities for those interested in corporate development activities.

On February 12, ECT will be conducting on-campus interviews for summer positions.

Spending The Day With J&J

In 1996, Forbes ranked Johnson & Johnson (J&J) fourth on its "America's Most Admired Companies" listing. As you may be aware, J&J is the world's largest and most comprehensive manufacturer of health care products with dominant positions in the consumer, professional, and pharmaceutical markets. As a participant in the "Day in the Life" program, I had the opportunity to visit the Personal Care Company, producer of external sanitary protection and oral care products. I gained insight into the J&J brand management team orientation via the Serenity and Stayfree teams.

Because of its flat structure, J&J affords the assistant product manager, an enormous amount of responsibility and exposure to upper-level executives. However, the responsibility does not come without significant support from fellow employees, as teamwork is obviously an essential part of J&J's corporate culture and success. Assistant product directors work closely with the various departments of the brand support team that include finance, consumer promotion, trade promotion, category management, research and development, planning and strategy, sales, regulatory, legal, purchasing, forecasting, and manufacturing. All departments work in concert with one another to produce results.

During my visit to Skillman, N.J., I had the opportunity to gain insight from personal product's group product manager, and work with product and assistant product managers, financial advisors, category managers, and national planners. Each J & J employee was eager to provide their perspective on the various efforts behind introducing and sustaining consumer goods in a highly competitive marketplace. Some of the many activities/topics I witnessed or discussed included:

* New product development and line extension processes.

* Determining the widespread long-term and short-term effects of marketing decisions.

* Researching, executing, and evaluating potential, current, and past consumer and trade promotional efforts.

* Evaluating current and potentially new product packaging.

* Budgeting and managing brand marketing expenditures.

* Facilitating focus groups.

* Current marketing and consumer trends.

* Scheduling and organization.

* Maintaining communication with related U.S. and non-U.S. J&J companies.

Needless to say, my visit to J&J was enlightening. J&J is a world-class company, and my first-class experience and treatment was most appreciated.

A Day In The Life With...

My bologna has a first name, it's O-S-C-A-R. My bologna has a second name, it's M-A-Y-E-R. We all remember the famous Oscar Mayer jingle. Through the "Day in the Life" program we got our chance to go back in time. One week before finals, we visited Oscar Mayer, a division of Kraft Foods in Madison, Wis. No, we didn't spend our day in the Wienermobile. Instead, we spent an exciting day with brand managers of products such as Lunchables, Claussen pickles, and Louis Rich deli meats.

Our adventure began with a dinner and a night on the town with U-M alumni, Carlos Abrams-Rivera, Laurie Hirsch and Scott Stuckman. In our short time in Madison, it was easy to see why the city was rated the number one place to live in America. Our hotel rooms overlooked the capital building and were just a short distance from the University of Wisconsin campus.

We started bright and early the next day. Our schedule was packed with twelve meetings that allowed us to see first-hand what brand managers do everyday. Each representative at Oscar Mayer was eager and enthusiastic about sharing their experiences with us.

The agenda we received the night before said we would be attending a "wiener correlation," but that did not prepare us for what we experienced. As we walked to our meeting, we discovered that correlation tests are used to determine the consistency of product samples. Translated: we ate wieners at 11a.m.! We taste-tested eleven samples of regular, smoky and cheese little links and gave our opinions on each. Who needed lunch after a meeting like that? Off we went to an evaluation by Nielsen of Talent Search, a promotion to find the new Oscar Mayer kid. Lunch was served featuring...what else?...bologna sandwiches.

Our next stop was a meeting to evaluate the development of a new website for Claussen pickles. The launch was slated for January 6. Be sure to visit it at http://www.pickles.com, <Online editor's note: this link is active but requires a password to access.> but don't ask us about the chattering teeth. You'll have to visit the website yourself.

For those of you who were hoping that statistics is dead and buried, guess again! As brand managers know, statistics lives on. During our visit, the brand manager for bacon met with production to resolve problems that had surfaced relating to product packaging. Imagine our shock at seeing quality control charts with out-of-control points, upper and lower control limits carefully labeled.

At the end of the day, we were exhausted but had an incredible experience. We received a comprehensive look into brand management including meetings covering new product development, marketing research, sales and consumer promotions. Oscar Mayer has a way with b-o-l-o-g-n-a and we would add brand management. Thanks to everyone at Oscar Mayer and Global Blue for a phenomenal experience!