Business Innovation And Risk Control

Enterprises in our country are facing a very precious development opportunity. Innovations of techniques, finance, organization, management, operating style and enterprises' culture are changing in endlessly. How to grasp this opportunity, bring in the experiences of innovation for development from enterprises of developed countries, and how to carry out the development on a large scale have become the necessary historical theme of our mass enterprise owners to think about and to make a decision.Enron has been the giant of the world energy industry, and the excellent representative of American enterprises' innovation culture and important spirit. Although it has applied for bankruptcy protection due to its financial crisis and accounting problem in late 2001, but actually, Enron is still the model of enterprises' research object attracting enterprise owners. This thesis tries to analyze the innovation process of Enron from different point of view and to explore the code of the innovations of western enterprises. I hope, through the critical analysis of Enron's financial innovation activities as well as the cause and reason of its financial crisis, the result could bring enterprises of our country a new hint in innovation strategy.There are three chapters in this thesis.Chapter One gives a brief description of the concepts of innovation and financial innovation, introducing the forms and means of the main financial innovation.Chapter two analyses the subsidiaries of Enron in their development, including the new motive of the innovation, the market environment, the thought, the application of the innovation means, the evaluation and the defect of innovation. It focuses on the financial innovation in Enron. The last part of this chapter analyses the relevant trade between Enron and its several main special purpose entities (SPEs),which has caused financial crisis in Enron.Chapter Three first discusses the reason of financial crises in Enron; as a result, it reveals the importance of the enterprise risk control. The later part introduces some enlightenment which the author has got from analyzing the innovation process in Enron. The author has also given its own advice on how China can make good use of innovation work in the economic globalization and the enterprise internalization.The main viewpoint and contribution are as follows,It cannot be denied that Enron made a great contribution to the development of the enterprise and the market even if Enron went bankrupt. The success of Enron lays in its innovation. The failure of Enron lays in the imbalance of innovation and control. We should understand Enron in an objective and fair way. The scandal is not the core of innovative culture in Enron. The enterprises of our country should learn from Enron's motive of innovation, the flexible idea of innovation and method as well as the sensitivity to the market.Through the success and fail of Enron, we can conclude:The development of enterprises should be a gradual process which is attractive and protective, expansive and controllable, innovative and regulatory. Innovation should be proper and appropriate. That is to say, we should lively implement enterprises' innovation related to the development, and we also should pay great attention to the innovation of enterprises' risk-control method and the construction of enterprises' inner risk-control systems. Trying to keep the current balance of enterprises' innovation and regulation ability is the basic guarantee for them to healthily develop.