Subject: Mid-year 2000 Performance Review Process

As we move into the Spring/Summer of 2000, it is time to turn our attention= =20 to the performance review process.
Mid-year is always busy and we have a= =20 number of important tasks and projects in process.
While recognizing this,= =20 it remains extremely important to take time over the next few weeks to gath= er=20 necessary information to provide quality and meaningful feedback for our=20 employees, as well as utilize this information during the year end review= =20 process.
In the spirit of One Enron, the Performance Review Process (PRC) will be=20 global for Mid-year 2000.
Vice Presidents and above across all operating= =20 companies will be reviewed and discussed in a consistent manner with=20 identical criteria.
ENA will review all professional level and above=20 employees.
The timeline and training for the midyear process are outlined = at=20 the end of this memo.
Your HR Business Consultant is also available to=20 answer questions.
With regards to the Global Functions, review sessions will be led by the=20 Global and/or Corporate Functional heads, and will be designed to calibrate= =20 personnel within these areas of expertise.
The Global Functional Review=20 Areas include:  _ NetWorks/Technology _ Accounting _ RAC _ Finance _ Human Resources _ Public Relations & Reg Affairs=09G.
Whalley =09R.
Causey =09R.
Buy =09A.
Fastow =09C.
Olson =09S.
Kean       =20 ENA Mid-Year Process:  ENA has received favorable feedback on the review process used for Mid-year= =20 and Year-end 1999, and as such, will follow the same general guidelines and= =20 process for Mid-year 2000.
The following are key features of the Mid-year= =20 2000 process:  o The focus of the feedback will continue to be on the qualitative aspects,= =20 as opposed to quantitative.
Toward this end, communication of the employee= =01,s=20 explicit ranking will be left to the discretion of the business unit manage= r. o Initial discussions with employees regarding their accomplishments, are= =20 highly encouraged, prior to the Business Review Meetings.
o Mid-year performance results will be used as baseline performance=20 information for Year-end 2000. o Creation of 3 standard feedback forms for all peer groups.
=20 o Standardization of criteria for all peer groups.
o   Utilization of a consistent 6 gradation rating scale.
=20 o All exempt employees will be discussed at Business Review Meetings and=20 placed into one of six categories by peer group.
ENA VP's will be pre-rank= ed=20 by the ENA Office of the Chairman and Managing Directors prior to the Enron= =20 PRC.
Non-exempt (overtime eligible) employees will be evaluated by their= =20 supervisors and placed into one of the 6 categories.
The results of the=20 Business Review Meetings will be the final rankings for exempt employees=20 below VP, subject to ENA Office of the Chairman.
o A minimum of two representatives from other functional areas will be=20 required at the Business Review Meetings.
The meetings should otherwise be= =20 rescheduled to allow this very important representation to take place.
The= =20 nominated individuals are illustrated below.
o The top 5 HR priorities/challenges for 2000 should also be agreed to at t= he=20 Business Review Meetings.
o Analysts and Associates will be pre-reviewed in a Business Review Meeting= s=20 based on their current rotation, then cross-calibrated at the Enron Global= =20 Analyst and Associate Business Review Meeting.
Peer Groups:   Commercial  Commercial Support  Technical  Specialized Technical  Performance Criteria (for all peer groups):  Innovation/Entrepreneurship Communication/Setting Direction Teamwork/Interpersonal Leadership/Vision/Values=20 Business Instinct Analytical/Technical  Guidelines:  o Use of multiple sources of input is encouraged (employee, peers, direct= =20 reports, internal customers, external customers), as is a self-evaluation o Employees should recommend 5-10 reviewers to Supervisor and Supervisor=20 should select at least three of the employee=01,s recommendations o All feedback must be entered via the Performance Management System locate= d=20 on the intranet o Supervisor should consolidate the feedback, prepare a draft of the=20 Performance Review form and meet with the employee prior to the Business=20 Review meeting o Final feedback to exempt employee follows the July 28th meeting o For VP's & MD's, final feedback follows the Enron Executive Committee=20 Meeting  Business Review Meetings / VP Pre-Ranking Committee Meeting=20 Responsibilities / Actions:  The following list represents suggested groups and the individuals=20 responsible for each Business Review Meeting.
Attendees at the meetings ar= e=20 appropriate Supervisors within the Business Unit.
In addition, the Office = of=20 the Chairman requires the attendance of two to three other senior level=20 representatives from other Business Units to add external perspective.
Area/Function=09ENA Lead=09Global/Functional Lead*=09Required Non-functiona= l  Attendees =09=09=09 COMMERCIAL=09=09=09 =09=09=09 Trading=09Presto=09=09Dietrich =09Shankman=09=09Calger =09Lavorato=09=09Bowen =09McClellan=09=09Ajello =09Hickerson=09=09Delainey =09Belden=09=09 =09=09=09 Origination=09Redmond=09=09Shankman =09Dietrich=09=09McClellan =09Milnthorp=09=09Belden =09Calger=09=09Presto =09Donahue=09=09Delainey =09Bowen=09=09Lavorato =09Ajello=09=09 =09Duran=09=09 =09Ondarza=09=09 =09Malcolm=09=09 =09Overdyke=09=09 =09Thompson/Josey=09=09 =09Yzaguirre=09=09 =09=09=09 Finance(*)=09Jakubik=09Fastow=09 =09=09=09 COMMERCIAL SUPPORT=09=09=09 TECHNICAL  =09=09=09 SPECIALIZED TECHNICAL=09=09=09 =09=09=09 Legal=09Haedicke=09=09 Research=09Kaminski=09=09 RAC=09Buy=09=09 Technical=09Miller/Parquet=09=09 =09=09=09 Energy Operations (*)=09Beck=09Causey=09Colwell =09=09=09Oxley =09=09=09 Business Analysis & Reporting/Tax (*)=09Colwell=09Causey=09Beck =09Mintz=09=09 =09=09=09 Human Resources (*)=09Oxley=09Olson=09 =09=09=09 Public Relations (*)=09Palmer=09Kean=09 =09=09=09 NetWorks/Technology (*)=09Perlman=09Whalley/McConnell=09  (*) Note:  Global Functional Review meetings to be held for these areas.
ENA VP Pre-Ranking Committee:  Ray Bowen=09Mark Frevert=09Dan Leff (non ENA rep)=09David Oxley Dave Delainey=09Brian Redmond=09George McClellan=09Mark Haedicke Janet Dietrich=09Julia Murray=09Jeff Shankman=09Gary Hickerson Jeff Donahue=09Jere Overdyke=09Marty Sunde (non ENA rep)=09John Lavorato  Outcomes of Business Review Meetings/ VP Pre-Ranking Committee Meetings:  o Calibration of employees into six gradations=20 o Promotion nominations below VP o Assessment of  the =01&right people in the right jobs=018 o Assessment of gaps for what is needed in the Business Unit (skills,=20 capabilities, training,  experience) o Top five HR challenges o Feedback to employees on the results of the meetings, as applicable  Timeline PEP System Open for Feedback    May 17=20 PEP System Closes for Feedback    June 9=20 Feedback Collection/Initial Employee    May 17-June 12  Discussions  =20 Global Functional Review Meetings   June 12-June 16 ENA Business Review Meetings    June 12-July 25 ENA VP Pre-Ranking Committee Meeting  July 28 Enron Executive Committee meeting   July 31-Aug. 1