Risk Management Performance Simulation

1. Risk Management Performance Simulation Subject Matter Expert Kick-Off Confidential Information to Accenture

2. Meeting Objectives • Demonstrate Performance Simulation and its benefits • Review Roles and Responsibilities • Confirm Target Audience • Define Desired Performance Outcomes “Tell me, I will forget.Show me, I may remember.Involve me, I will understand.” - Chinese Saying Confidential Information to Accenture 1

3. Accenture • Over 1,000 hours of performance simulation solutions including: • $500M annually from increased productivity due to 50% reduction in time-to-proficiency • 20 to 30% increase in learning retention for participants • $11.25M annually by 16% increase in upselling revenue and decrease in time to proficiency • Performance Simulation Capabilities: • 12 years of simulation experience • 2,000 worldwide resources with simulation experience • Patented Simulation technology (36 patents filed, 25 patents approved, 11 pending) • Scalable architecture delivered in a net-sourced environment • Artificial intelligence expert engine (up to 30,000 variables) Confidential Information to Accenture 2

4. 100 Hours What are the benefits of Performance Simulation to Enron? • 75% retention level vs. classroom based training (10%)* (*National Training Laboratory) • Marginal cost of additional participants beyond 1st year is only Admin Cost • Current Yearly Class Attendance: 1,710 @ cost of $1,843,398 (includes Diverted Labor Cost) • Break Even is @ 1830 participant @ cost of $1,973,409 (includes Diverted Labor Cost) • Estimated Savings over next 3 years: • Keeping # of participants constant: $2,362,125 $618/Person vs Current $1,078/Person • Increasing # of Participants by 50%: $4,874,608 $445/Person vs Current $1,078/Person • Reduction in time to proficiency 93% 65% 700 Hours 40% **GE results 250 Hours AverageComparativeTest Scores 2-Year MBA Grads Classroom Learning(Control Group) Performance Simulation(Test Group) Confidential Information to Accenture 3

5. The simulation is expected to provide an alternative to the basic derivative courses you already have AND to lay the foundation for future modules increasing in market complexity. • Simulation • 4-6 hours of learner experience Identify Risk Select Hedging Instruments (Futures, Forwards, Swaps, Options, EFPs) Manage Positions TO BE DEFINED WITH SMEs • Knowledge System Possible Topics/Practices • 4- 6 hours of learner experience • Long and Short • Derivative Basics • Commodity Fundamentals • Hedging Basics • Stages of Commoditization • Forward Curves • Marking to Market • Position Reporting • Delivery and Other Risks • Risk Analysis Model • Risk Mitigation Steps • Value at Risk • Profit and Loss • Market Overviews Confidential Information to Accenture 4

6. Introductions Executive Enron Sponsors Steve Keane Cindy Olson David Oxley Enron Sponsors Tim O’Rourke Brad Coleman Yevgeny Frolov Support IT Marketing Brandon Bangerter TBD Project Leader Kirk McDaniel Project Leader Don Barnhart Project Advisor Jon Stahl Technical Team Functional Team SMEs Tech Arch Lead Jim Gilchrist Executive SMEs Phillip Allen John Arnold Modeling Lead Ann Chen Simulation Lead Mery Brown Media/Topics Lead Sheri Righi SimPack Lead Kurt Desserich Content SMEs Dutch Quigley Andy Lewis Bernie Aucion Mark Reese Ed McMichael David Port* Peripheral SMEs Vince Kaminski Connie Estrem Model Advisor Michael Willow Sim Developer Laura de la Torre Topics Developer Monica Brown Technical Developer Shane Cisco Confidential Information to Accenture 5

7. Performance Simulation Development Process Needs Analysis Content Development Build Test Delivery Technical Development Aug. 27 – Sept. 21 Sept. 24 – Nov. 9 Nov. 5 – Dec. 7 Dec. 10 - Jan. 11 Jan. 14- 18 Deliver Final Product • Develop Simulation: • Storyline • Resources • Feedback outline • Systems Model • Data Model • Tune Causal Model • Develop Topics: • Content • Practices • Glossary • Develop Media: • Graphics • Video/Audio scripts • Technical architecture customization • Develop: • Feedback • Video/Audio • Test Scripts • Integrate content into simulation • Conduct high- fidelity test • Conduct: • System Test • Pilot Test • Identify: • Target audience • Industry best practices • Develop performance objectives/Causal Model • Finalize: • Simulation design • Topic List and Outlines • Technical Architecture Approach Confidential Information to Accenture 6

8. Performance Simulation Development Process: SME Responsibility Needs Analysis Content Development Build Test Delivery Technical Development Aug. 27 – Sept. 21 Sept. 24 – Nov. 9 Nov. 5 – Dec. 7 Dec. 10 - Jan. 11 Jan. 14-18 • August 27- August 31: • 2 hr kick-off meeting 8/28 • 2-3 hr Hexagon Session 8/29 or 9/4 • September 4-7: • Two 2 hr meetings: 9/4, TBD • 2-3 hr Hexagon Session TBD • September 10-14: • Two 2 hr. meetings • 3 hrs to review deliverables • September 17-21: • 2 hr meeting • 5 hrs to review deliverables • 8 hrs/week for the first four weeks (until 10/19) to: • Write Topics • Provide simulation content • Review deliverables • 4 hrs/week for the last three weeks (until 11/9): • Complete topics • Review deliverables 2 hrs/week 6 hrs/week to test the simulation and topics Confidential Information to Accenture 7

9. Confirm Target Audience • Group Size • Analysts and Associates Program - 700 • Trading Track – 50 • Energy Ops, Structuring, Logistics, etc. • Age: 22-30 years • Level of Trading and Risk Management Knowledge • Economics and Finance – some knowledge • Energy Commodities and Derivatives – little knowledge • Career Goals and Motivation • Analysts and Associates want to: • Become managers • Develop new markets for Enron • Differentiate themselves from the group • Trading track want to: • Become star traders • Expand risk limits • Get promoted Confidential Information to Accenture 8

10. Performance Objectives: Capabilities the learner should be able to exhibit as a result of completing the simulation. What is the most important performance objective for the RM Simulation? What do you want people to be able to do after taking the RM Simulation? Confidential Information to Accenture 9

11. Appendix Confidential Information to Accenture 10

12. Meeting Objectives – Needs Analysis Phase • Week 1: August 27-31 • Brainstorm/review Learning Objectives • Discuss content scope • Discuss Target Audience • Hexagon Session for Model • Week 3: September 10-14 • Confirm Learner Tasks • Confirm Storyline • Confirm Common Mistakes • Discuss Interaction Design • Iterate Causal Loops for Mode • Confirm Topic Frameworks • Week 2: September 3-7 • Brainstorm/review Common Mistakes • Discuss Storyline • Discuss Learner Tasks • Confirm Learning Objectives • Hexagon Session for Model • Develop Causal Loops for Model • Confirm High Level Topic List • Week 4: September 17-21 • Discuss Resources • Discuss Expert Model (if necessary) • Confirm Topic Frameworks • Develop Initial Conditions for Model (Storyline) Confidential Information to Accenture 11

13. Meeting Objectives – Content Development Phase* • Week 1: September 24-28 • Review Resources Inventory • Review/Revise Expert Model (if necessary) • Confirm Initial Conditions for Model (Storyline) • Enter Content for Topics • Week 3: October 8-12 • Review first draft of Expert Model (if necessary) • Provide Input Documents • Quantify Model Factors • Enter Content for Topicsand graphics • Develop Expert Stories scripts • Week 2: October 1-5 • Review/Revise Expert Model (if necessary) • Provide Input Examples • Quantify Model Factors • Enter Content for Topics • Develop Expert Stories scripts • Week 4: October 15-19 • Revise Expert Model (if necessary) • Review first drafts of Resources • Tune Model • Enter Content for Topicsand graphics • Confirm Expert Stories scripts * To be revised as necessary after Needs Analysis Phase Confidential Information to Accenture 12

14. Meeting Objectives – Content Development Phase* (cont.) • Week 5: October 22-26 • Review second draft of Expert Model (if necessary) • Revise Resources • Provide input regarding Video Characters Profiles • Tune Mode • Enter Content for Topics and graphics • Develop Practices for Topics • Develop Glossary • Sign off on Expert Stories • Week 6: October 29-November 2 • Revise Expert Model (if necessary) • Review second draft of Resources • Discuss Video Script Content • Review final Model • Sign off on Topic Content (first half) • Sign off on Practices for Topics • Develop Glossary • Week 7: November 5-9 • Sign off on Expert Model (if necessary) • Sign off on Resources • Sign off on Model • Sign off on Storyline Script outlines for simulation • Sign off on Topic Content (second half) • Sign off on Glossary * To be revised as necessary after Needs Analysis Phase Confidential Information to Accenture 13

15. Model Building • Hexagon session • A hexagon session is a brainstorming technique widely used in systems thinking. It is designed to extract experts’ mental model and intuition on how a system works. It also fits well with the idea of building system dynamics models as the hexagon session naturally follows the event-behavior-structure sequence. • Causal loop modeling • Systems modeler further defined the influence, causal loop, and component diagrams with SMEs. Iterative process. • Detail design sign off • SME team designated by a steering committee signs off on the detail design. • Quantification interviews • Systems modeler meets with SMEs deep in subject matter expertise in particular areas. • Tuning sessions • Systems Modeler meets with SMEs to tune model. • Model Validation • SME team designated by a steering committee validates and verifies results are reasonable and in line with learning objectives. Some tuning will be required. SMEs should be at a high enough level that their buy in and validation is golden. Confidential Information to Accenture 14

16. Sign Off Process - Simulation The sign off process will occur at the end of each phase. Deliverables will not be passed to the next review until the previous reviewers have approved it. SME Review Dutch Quigley Andy Lewis Mark Reese Connie Estrem Project Management Review Kirk McDaniel Don Barnhart Enron Signoff Phillip Allen John Arnold Content Development Laura de la Torre Mery Brown Review • Check for: • Consistency within Simulation • Performance Objectives • Common Mistakes • Usability • Review for: • Content Accuracy • Realism • Best Practices • Review for: • Consistency across components • Appropriate scope • Review for: • Appropriate strategic direction • Incorporation of key messages Goals Confidential Information to Accenture 16

17. Sign Off Process - Topics The sign off process will occur at the end of each phase. Deliverables will not be passed to the next review until the previous reviewers have approved it. Topic Development Dutch Quigley Andy Lewis Mark Reese Connie Estrem Project Management Review Kirk McDaniel Don Barnhart Topics Team Edits Monica Brown Sheri Righi Enron Signoff Phillip Allen John Arnold Review • Edit for: • Consistency of tone and style • Consistency of content across topics • Performance Objectives • Common Mistakes • Review for: • Consistency across components • Appropriate scope • Review for: • Appropriate strategic direction • Incorporation of key messages Goals Confidential Information to Accenture 17