Enron is back in the news because Jeff Skilling’s appeal is currently in front of the Supreme Court (his sentence may be reduced or overturned on a technicality).

Arthur I. Cyr, Clausen Distinguished Professor at Carthage College, offers an interesting commentary on Skilling, the Enron debacle and Arthur Andersen.

Leadership personality is telling in any organization. Skilling from early days as a McKinsey consultant was notorious for an exceptionally aggressive, grasping style. Business author and former colleague Tom Peters described him as apparently able to “out-argue God.”

The damage that attitude causes knows no bounds and holds true wherever it is found.

Enron, stock option backdating and finally the derivatives of the financial meltdown are all from the same seeds.

In hindsight, Enron’s death was symptomatic of growing global problems. In an age of great prosperity and exceptionally cheap credit, people fairly easily could put greed before good judgment.

Greed before good judgment says a lot, but not quite all.

Even when greed isn’t the driving force there is ideology—an inflexible force that proponents claim eliminates the need for any judgment at all.

Good management, however, requires flexible, insightful human strengths. Regulation and law enforcement only provide context.

Cyr’s final comment sums up the true solution as well as the why rules and even laws don’t work.

Image credit: Svadilfari on flickr

I have 5 stories for you today about CEOs, two who don’t and four that do.

Pundits (consultants, academics, bloggers) are fond of lauding CEOs for their vision and skill at imparting it to their followers—Richard Fuld, Bob Nardelli, Jeff Skilling, Bernard Ebbers, Dennis Kowalski, the list is long—but after their meltdown you hear only from the Monday morning quarterback crowd.

But if you want to sort the true stars from the others, you need to take a long-term look—not Wall Street’s typical quarter or even a decade—at more than the stock price.

Moreover, you need to look at the down times; the times when the economy sucks, yet the CEO still finds ways to foster a great culture and stoke innovation—not just cut staff and threaten execs with termination if they don’t make their numbers.

For better or worse, it’s not in the vision or the leading, it’s the doing.

Our first story is should be a familiar name to all of you. Remember Sandy Weill? The man who drove the repeal of Glass-Steagall in 1999 and whose deal making built CITI, the colossus that never really jelled. He was named “C.E.O. of the Year” in 2002 by Chief Executive Magazine, but that was then and this is now.

The travails of newspapers aren’t news anymore, but Frank Blethen, CEO the Seattle Times Co. has made matters much worse in the name of family.

Far on the other side are General Electric CEO Jeff Immelt and Procter & Gamble’s A.G. Lafley. The two are good friends and Fortune senior editor Geoff Colvin shares a rare joint interview with them.

In today’s cutthroat business world how many CEOs would lift a finger to save their competition? Ted Baseler, CEO of Chateau Ste. Michelle did exactly that when freezing temperatures wiped out the grape harvest in 2004. He didn’t just save his competition; he’s credited with saving the entire Washington state wine industry. Baseler is the quintessential big picture guy.

“We want Washington known. All of it. We’re not about to fight over whose bottle of wine gets sold. We’re competing with Napa, with France. We’re not competing with Washington wineries.”

My last offering is an interview with Pete Peterson, co-founder of Blackstone Group, looks back on s storied career and offers his insights as to what’s needed to “rebuild the American dream.” There’s a video (that refuses to embed) and a PDF of the interview (requires free registration). I think you’ll find it interesting.

Image credit:  pedroCarvalho on flickr

The scandal at Satyam in India brings forth an interesting thought. In an article by him, Jitendra Singh, a Wharton management professor who is currently dean of the Nanyang Business School in Singapore says, “…companies with “the bluest of blue-chip reputations [such as] Infosys and TCS” could actually gain in the current environment, because of a potential “flight to quality” among client companies.” The third-tier and weaker companies will probably undergo a lot more scrutiny.”

Why does it make sense to do in-depth due diligence on third-or-lower tier companies, while taking top tier companies on faith and accepting their reputations with only cursory review.

Until their dirty linen came to light. Bernard Madoff’s hedge fund, Jeff Skilling’s Enron, WorldCom and Tyco were all considered top-tier.

This attitude of blindly accepting what is said by the top and increasing due diligence on lower levels is found everywhere, but it really permeates the hiring process.

I’ve lost count of the executives and managers I’ve known who went with cursory or no reference checks because the candidate

• was a C-level executive;
• graduated from a top-tier school;
• earned over $100K;
• had a PhD;
• was referred by an executive or board member;
• etc.

but ran exhaustive reference checks on every candidate below VP or director, including credit and criminal checks.

Does that make any sense to you?

Image credit: flickr