At Enron, we,re good at a lot of things:  making markets, commoditizing 
products, managing risk, offering innovative energy solutions to customers ) 
the list goes on and on.  However, one of the things we could do a lot better 
is watching our expenses.  We,re all shareholders in this company, and we 
need to spend our company,s dollars as wisely as we spend our own.

There are some simple, yet significant measures each of us can take to make 
sure we,re careful with Enron,s money.  The Policy Committee has approved and 
recommended the following:

? Professional Services ) This is our largest area of discretionary spending, 
at more than $600 million last year. &Professional Services8 includes our 
contracts with outside law and accounting firms, contractors and other 
consulting groups.  To make sure that we are negotiating the best rates and 
terms of service for the company across business units, we are requiring all 
future professional service contracts and those up for renewal to be 
negotiated through or in consultation with Global Strategic Sourcing (GSS), 
effective July 1.  In addition, contracts for more than $5,000 must be 
pre-approved by the business unit senior executive or their designee and 
GSS.  For more information, see http://ibuyit.enron.com.

? On-line expense reporting tool XMS ) XMS, our online expense reporting 
tool, enables us to expedite, monitor and report expenses.  Effective July 1, 
all employees on domestic U.S. payroll will be required to use XMS for 
reimbursement of business-related expenses. To access XMS, go to 
http://xms.enron.com/.  

? Enterprise wide portal ) We currently have 122 internal web sites across 
the company.  The amount of technology work, marketing collateral, and other 
related costs required to develop and support so many portals is sizeable.  
It makes sense to have one Enron portal so you can efficiently access content 
and services through a single, personalized channel that will make it easier 
for you to find information and perform basic tasks online.  This new 
company-wide portal, under the leadership of Tony Mends, will be launched in 
several phases beginning this fall.  

Another significant area where we can be more diligent in our spending is 
travel and entertainment.  Enron has long had travel policies in place.  As 
we have grown, we have not done as well as we should have in communicating 
those policies to new employees and reminding all employees to take advantage 
of the discounts we have negotiated.  The availability of discounts and 
booking services online should make it easy to save money for the company 
without sacrificing the comfort of employees who travel.  The following are 
common sense recommendations that we should all adhere to when traveling for 
business.  Any regular deviations from these travel policy recommendations 
will be reviewed by each business unit leader.

? Air travel ) Employees are requested to use either Travel Agency in the 
Park (TAP) or the GSS-approved preferred travel agency for your location - 
all of which have access to the significant airfare discounts negotiated by 
GSS - or http://clicktrip.enron.com/enron, the new online travel booking 
service that allows employees to book their own travel with the same 
negotiated discounts.  Employees who fly in the United States should book 
non-refundable coach tickets, which are typically 65 percent less than 
refundable tickets and can usually be changed by simply paying a $100 fee.  
For this reason, we strongly encourage all employees to purchase 
non-refundable domestic coach tickets when possible.

? Lodging ) GSS has also negotiated preferred rates at a number of hotel 
chains in many cities worldwide to accommodate each business unit,s 
individual hotel policy.  We recommend that you use Enron,s list of preferred 
hotels to select accommodations that are in line with your business unit,s 
policies.  You can view the list at http://travel.enron.com.

? Car rental services ) When renting a car for business travel, employees 
should use our preferred car rental agencies ) National (U.S. and Canada) and 
Alamo (U.S.)- since the agreements we have negotiated are intended to protect 
you and Enron through the insurance coverage in our contract.  Visit 
http://travel.enron.com for details and updates to services available outside 
the U.S.

? Off-site meetings ) All domestic-U.S. off-site meetings and events with 
more than 10 people should be coordinated through GSS, which will negotiate 
preferred rates for Enron.  They can be reached at (713) 646-8311.

Because there are differences between business units and offices, each 
business unit leader will follow up this memo with a communication further 
elaborating on these policies as they apply to their business unit.

Each of us has a responsibility to make sure we do our part to ensure Enron 
retains its competitive edge.  These recommendations are some basic, sensible 
actions we can take company-wide, but it is up to every employee to look for 
cost saving measures and do what makes sense in your daily activities.  If 
you have an idea or a suggestion you would like to share with us, please 
e-mail us at recommendationsforcostsavings@enron.com.   A list of questions 
and answers about these policies is posted on 
http://ibuyit.enron.com/gss/ibuyit/csfaq.doc.  If you have additional 
questions, Policy Committee member Kevin Hannon will host an eSpeak on 
Tuesday, June 19 at 10 a.m. Houston time to discuss these cost saving 
recommendations.
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