Message-ID: <23941568.1075840639522.JavaMail.evans@thyme> Date: Wed, 1 Nov 2000 01:48:00 -0800 (PST) From: tim.belden@enron.com To: kathy.axford@enron.com, tim.heizenrader@enron.com, cooper.richey@enron.com, julie.sarnowski@enron.com, geir.solberg@enron.com, murray.o'neil@enron.com, heather.dunton@enron.com, caroline.emmert@enron.com, donna.johnson@enron.com, chris.stokley@enron.com, chris.foster@enron.com, paul.choi@enron.com, holli.krebs@enron.com, john.malowney@enron.com, stewart.rosman@enron.com, kim.ward@enron.com, greg.wolfe@enron.com, mike.swerzbin@enron.com, sean.crandall@enron.com, diana.scholtes@enron.com, cara.semperger@enron.com, jeff.richter@enron.com, smith.day@enron.com, chris.mallory@enron.com, phillip.platter@enron.com, robert.badeer@enron.com, d.hunsucker@enron.com, john.forney@enron.com, michael.driscoll@enron.com, holden.salisbury@enron.com, jeremy.morris@enron.com, lester.rawson@enron.com, donald.robinson@enron.com, bill.iii@enron.com, carla.hoffman@enron.com, matt.motley@enron.com, mark.guzman@enron.com, stanley.cocke@enron.com, jesse.bryson@enron.com, lisa.gang@enron.com, mike.purcell@enron.com, maria.houten@enron.com, tim.belden@enron.com, tom.alonso@enron.com, mark.fischer@enron.com, john.shackelford@enron.com, debra.davidson@enron.com, robert.anderson@enron.com, david.poston@enron.com, leaf.harasin@enron.com, monika.causholli@enron.com, kourtney.nelson@enron.com, mark.rathbun@enron.com, ryan.slinger@enron.com, stacy.runswick@enron.com, lani.pennington@enron.com, wendella.rhoads@enron.com, walter.seaton@enron.com, wendy.aiello@enron.com, lisa.mattingly@enron.com, winston.goodbody@enron.com, lei.chen@enron.com Subject: Communicating with Risk Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: Tim Belden X-To: Kathy Axford, Tim Heizenrader, Cooper Richey, Julie Sarnowski, Geir Solberg, Murray P O'Neil, Heather Dunton, Caroline Emmert, Donna Johnson, Chris Stokley, Chris H Foster, Paul Choi, Holli Krebs, John Malowney, Stewart Rosman, Kim Ward, Greg Wolfe, Mike Swerzbin, Sean Crandall, Diana Scholtes, Cara Semperger, Jeff Richter, Smith L Day, Chris Mallory, Phillip Platter, Robert Badeer, D Brett Hunsucker, John M Forney, Michael M Driscoll, Holden Salisbury, Jeremy Morris, Lester Rawson, Donald Robinson, Bill Williams III, Carla Hoffman, Matt Motley, Mark Guzman, Stanley Cocke, Jesse Bryson, Lisa Gang, Mike Purcell, Maria Van Houten, Tim Belden, Tom Alonso, Mark Fischer, John Shackelford, Debra Davidson, Robert Anderson, David Poston, Leaf Harasin, Monika Causholli, Kourtney Nelson, Mark Rathbun, Ryan Slinger, Stacy Runswick, Lani Pennington, Wendella Rhoads, Walter Seaton, Wendy Aiello, Lisa Mattingly, Winston Goodbody, Lei Chen X-cc: X-bcc: X-Folder: \mark guzman 6-28-02\Notes Folders\Discussion threads X-Origin: GUZMAN-M X-FileName: mark guzman 6-28-02.nsf This may not pertain to everyone. However, in the interest of over-communicating rather than under-communicating, please read the following. ---------------------- Forwarded by Tim Belden/HOU/ECT on 11/01/2000 08:48 AM --------------------------- From: Tim Belden on 11/01/2000 09:41 AM To: Mike Swerzbin/HOU/ECT@ECT, Robert Badeer/HOU/ECT@ECT, Sean Crandall/PDX/ECT@ECT, Tim Belden/HOU/ECT@ECT, Jeff Richter/HOU/ECT@ECT, Diana Scholtes/HOU/ECT@ECT, Tom Alonso/PDX/ECT@ECT, Mark Fischer/PDX/ECT@ECT, John M Forney/HOU/ECT@ECT, Paul Choi/SF/ECT@ECT, John Malowney/HOU/ECT@ECT, Holli Krebs/HOU/ECT@ECT, Greg Wolfe/HOU/ECT@ECT, Chris H Foster/HOU/ECT@ECT, Stewart Rosman/HOU/ECT@ECT, Kim Ward/HOU/ECT@ECT, Debra Davidson/PDX/ECT@ECT, Tim Belden/HOU/ECT@ECT, Lester Rawson/PDX/ECT@ECT cc: Monica Lande/PDX/ECT@ECT, Valarie Sabo/PDX/ECT@ECT, Fran Chang/PDX/ECT@ECT Subject: Communicating with Risk A couple of things happened yesterday where communicating with our risk team could have saved them a lot of time. I have asked the risk group to put together a list of things they need to know from us each day; until we distribute the definitive list, this e-mail should serve as a reminder that more communication is much better than less. First, you need to hear about how a simple little thing can cause our risk systems to blow up. My goal is not to point a finger, but rather to highlight the fact that we need to be thinking about the risk group any time we change something in Enpower. Yesterday, somebody on the short term california desk entered a 1 MW deal for 1 hour with the wrong delivery point. The delivery point was somewhere in the eastern US. The deal was promptly changed, but not before the east desk had "calced" their books. When the west risk group attempted to "calc" our books, the system found a deal (the same 1 MW deal) that had already been "calced" by the east. The result was that the portcalc blew up and there was no way to know why. The technology group in Houston worked through the night to figure it out. Our risk group was here until about 11 PM trying to figure it out. Finally, the problem was discovered this morning. The result was that we didn't publish a preliminary P&L last night and we didn't have correct positions this morning. On top of that, people who are already overworked had to put in long hours. IN THE FUTURE, IT IS YOUR JOB TO COMMUNICATE INFORMATION -- LARGE OR SMALL -- TO THE RISK GROUP. It is impossible to know what types of things may cause problems. Therefore, I can't prescribe exactly what has to be communicated. Obviously, you don't need to tell them about every deal that you have entered, but you need to tell them about any changes to deals. Try to communicate too much. Let them tell you when it is too much information. Another area of communication that must be improved concerns long term deals. The interest rate group needs to know about material changes in cash flows in the future. Our risk group currently communicates this information to the interest rate group. If we don't tell them, they can't tell the interest rate group, and the interest rate group yells at our risk group. Nobody likes to get yelled at. Yesterday, we did a couple of long term deals with BPA in the 2002 to 2006 timeframe. Nobody on the desk communicated this to the risk group. In the future, please communicate any deal that is longer than a year to the risk group. Again, my goal is not to chastise the people who caused the problems yesterday. We had no idea that changing a small deal could blow up our system. But going forward, I am going to be really mad if our lack of internal communication leads to uneccessary work and/or headaches for others on the floor. All of our lives will be much better if we communicate more. Thanks for your attention to this matter, Tim