Lou Pai and Corporate Politics

Lou Pai, former head of Enron Energy Services and former instrument of Jeff Skilling's will, was a smart businessman with an eye for trading talent (and no small amount of trading talent himself). His real genius, though, was a certain brutish political skill.

In a company marked by fiefdoms and infighting, Pai was Enron's fiercest corporate warlord. He made short work over the executives who had been placed over him. He took credit for the achievements of others, ridiculed adversaries behind their backs, undermined them in front of colleagues, and ignored orders he didn't' like.

"Lou was extremely good at eliminating everyone in his way," says one longtime ECT executive. An early trader who worked for Pai adds, "It became apparent that you don't mess with Lou." A third chimes in, "If you got in the way of Lou's agenda, he'd get rid of you."

Once Ken Lay convened an off-site employee conference where the featured speaker was Stephen Covey, author of the management bestseller The Seven Habits of Highly Effective People. Pai told a colleague he saw with the book, "throw that away. Buy Sun Tzu's "The Art of War."

Pai served as the human template for the trading culture at Enron. He saw things in black and white. "Lou was the purest character I ever met because it was always about one thing: money," says a longtime Enron trader. Colleagues were struck by Pai's unerring instinct for picketing the most personally from every financial opportunity. Years later, when Enron spun off a shaky new business that Pai chaired, one senior colleague made a point of buying shares merely because he figured that Pai, who owned a hefty stake, would figure out a way to reap a windfall.


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