UtiliCorp United, Duke Energy and Enron have a lot in common,and it has a lot to do with how they “embrace and exploit change”rather than resist it, according to Arthur Andersen’s Doug King.King, a partner in the London office, told attendees at the HoustonEnergy Symposium last week that the three companies have learnedthe same lessons, which have led to their present success.

CEOs from the three companies, including Utilicorp’s Richard C.Green Jr., Bruce A. Williamson, of Duke Energy International, andMichael S. McConnell, of Enron Global Markets, spoke about theirstrategies for success at the opening plenary session.

Green said his company has built its success by replicating itsbusiness model to other types of businesses and following the”value cycle philosophy” mantra of “invest, optimize, monetize.”Green said the modeling was first put in place in 1986 with its gasmarketing business, followed in 1990 with pipelines and then powermarketing in 1996. Two years ago, the company began gas marketingin Canada and last year set up a gas storage facility in Katy, TX.

Now, the company is replicating its model for the broadbandmarket, and last week, Utilicorp Communications Services, asubsidiary of UtiliCorp United, said it had formed a partnershipwith Prairie iNet as part of an effort to bridge the “digitaldivide” between cities and rural areas of the U.S. Mid-continentregion.

“We had an earnings growth of 4% in 1995. This year, it’s 20%growth, and we expect that rate to continue into the future,” saidGreen. “We replicated the Aquila model in Canada in 1996,” and hesaid that by replicating in new markets, such as Australia andEurope, the company has built on its success.

While he does not foresee UtiliCorp picking up any newacquisitions in the United States in the near future, he said a lotof growth will come from global markets, especially Europe andAustralia.

Both Duke and Enron have also relied on their core competencies— originally supplying gas and electric services — to grow,said King. International businesses have been built in wholesalemarketing and trading, and now the growth companies like UtiliCorpare looking toward the broadband market.

“All three have ceased to be traditional utilities,” said King,referring to the companies’ growth path, which has led to stunningsuccess in North America and global markets. By looking towardfuture markets, and revising their strategies as the marketchanged, King said that the three offered lessons to other energycompanies.

Another key to the three powerhouses’ success is that they referto themselves as “knowledge-based companies,” and have tuned in tothe technology age, employing and training their workforces to suitthe times. And, by not only buying assets but not being afraid tosell them, the three have kept their burgeoning businessesstreamlined and efficient.

Enron’s McConnell said that the global business is divided intotwo large business divisions, the traditional energy division andthe new communications division. Energy comprises the transmissionand distribution markets, wholesale energy trading and retailmarkets. Communications are Enron’s broadband services arena.

Carolyn Davis, Houston

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