Analysis of American Red Cross

Subject: Business
Type: Analytical Essay
Pages: 13
Word count: 3420
Topics: Management, Globalization, Nursing, Organizational Behavior


The structure of leadership is a fundamental factor that determines the effectiveness of any company or organization across all sectors of an economy. Appropriately referred to as the organizational structure, this component of an organization plays a critical role in determining the extent to which an organization achieves its objectives effectively and efficiently. Notably, most of the rot in most organizations is traceable to fundamental deficits in the organizational structure, especially when it comes to established leadership. The same case applies to organizations that do extremely well in their markets; the organizational structure of these entities is grounded on good principles of corporate leadership. Unsurprisingly, ethical leadership is an integral part of good corporate governance. An organizational structure that is established upon a culture of ethical leadership plays a significant role in helping the organization achieve its objectives in the most effective and efficient manner. It is disappointing to note that most of the world-known organizations have failed miserably solely due to practices of unethical leadership at the very top. Undertaking fundamental changes to the organizational structure of such entities is critical to re-establishing their former glories.

This paper analyses the organizational structure of the American Red Cross and pinpoints what makes it effective or ineffective as far as helping the organization achieve its goals. Further, the paper looks at how the globalization phenomenon in modern society influences the organization in its obligations. In conclusion, the paper highlights some of the positive contributions of the organization to the American society as well as to the global community.

The American Red Cross: Industry, Services, and Current Status

The American Red Cross is one of the most visible charitable organizations in the United States of America and operates within the framework of the International Red Cross global society. Founded in 1881 by Clara Barton, the organization was chartered by the United States Congress in 1900 for the first time; a second charter was granted by Congress in 1905 and is still in force at the moment (Forsythe & Rieffer-Flanagan, 2016). Notably, under the second charter, Congress mandates the American Red Cross to act as a bridge between members of the US armed forces and their families (Jones, 2012). Additionally, Congress mandates the organization to establish and sustain a system of domestic and international relief in situations of catastrophic nature, such as floods, earthquakes, hurricanes, fires, and other devastating natural disasters.

The American Red Cross offers a broad range of services most of which are directed towards relieving pain and suffering of persons caught up in both human-made and natural disasters. These services are classified into several programs. For example, the organization offers services to members of the armed forces, particularly veterans, in coping with personal mental health problems (Jones, 2012). Under this program, the American Red Cross provides counseling services to the personnel of the armed forces and also facilitates rapid communication to the forces during emergencies. More importantly, the organization provides financial assistance to those severely affected by disasters. Another service category of the American Red Cross is the disaster services program, which helps in developing plans for disaster preparedness (Jones, 2012). Additionally, when a disaster strikes, the program helps in initiating emergency care for victims, besides providing rehabilitation assistance that helps in offering aid and other services to individuals and families caught up in a disaster zone.

Another service category provided by the American Red Cross is the blood services program, which happens to be the largest blood donor worldwide. Under this program, blood that is collected from donors is processed and made available to hospitals and doctors all across the United States and beyond (Jones, 2012). It is important to note that clinical research plays an integral part in the blood services program. Another service category is the tissues service program as well as the US’s first bone marrow registry that was founded in the 1980s (Jones, 2012). The nursing and health services program is another category of services provided by the American Red Cross. The program enrols registered nurses to help during disaster outbreaks and also assists in sponsoring classes in home nursing. Additionally, the program is critical to the blood services program as well as in the provision of other essential community health services. Another important service category of the American Red Cross is the safety services program that hosts a corps trained instructors (Jones, 2012). Most of these instructors are volunteers who offer and teach first aid, cardiopulmonary resuscitation, and water safety among other critical skills.

On the international front, the American Red Cross has the international services program where members of the organization work hand in hand with the International Red Cross. Among the services offered include funds, specialists, and supplies provision for relief during major catastrophic disasters in foreign lands (Jones, 2012). Today, the American Red Cross has approximately two million volunteers worldwide who take part in activities supported and funded by voluntary public and voluntary corporate contributions (Jones, 2012). Notably, the local chapters of the organization act as channels for receiving these monetary contributions.

The Organizational Structure of the American Red Cross

As far as organizational structure is concerned, the American Red Cross is directed by a board of governors that consists of 50 persons (Jones, 2012). Thirty of the board members are elected by the local chapters of the organization, 12 are appointed by the board, while eight are appointed directly by the President of the United States (Jones, 2012). The US President also appoints, from his appointees, the person who acts as the chairperson of the board. The organization has its headquarters in Washington, D.C., besides having a total of eight regional offices and approximately 2300 local chapters across the nation (Jones, 2012). Consequently, to help in its critical role of relief during disasters, the organization has approximately 45 regional blood centers and about 27 tissues services centers (Jones, 2012). Indeed, this organizational structure plays a fundamental role in determining the effectiveness or ineffectiveness of the organization in achieving its federal mandate. However, it is important to note that several factors play a part in determining this structure of leadership and operation. Firstly, the American Red Cross is the largest charitable organizations in the United States with a federal mandate (Jones, 2012). This element explains the role that Congress plays in determining the objectives of the organization and the role that the US President plays in appointing board members, including the chairperson.

Regarding operations, communication needs play a significant role in determining the regional representation of the local chapters as well as the service programs. It is important to note that the American Red Cross has several options of communication available. Some of these avenues are appropriate for day-to-day operations, others to act as backup for mutual aid arrangements, and still others for national headquarters. However, under normal conditions, the organization uses these communications options just like any other ordinary entity; that is, pagers, telephones, fax, and the Internet for electronic mail among others. Notably, the organization also has a dedicated licensed radio frequency as well as equipment used in most Emergency Response Vehicles (Jones, 2012). The organization also uses amateur radio for backup communication when necessary. Consequently, the local chapters of the American Red Cross are at liberty to establish agreements with General Mobile Radio Service groups within their localities (Jones, 2012). Irrefutably, this is necessary during disasters where local communication infrastructure is rendered ineffective or non-functional.

In essence, the communication needs of the American Red Cross emanate from the destructions occasioned by devastating natural and human-made disasters. Indeed, for effective disaster response, the organization requires a communication infrastructure for mass care, administration, liaison with government agencies, assessing damage, and disaster mental health and general health services provision (Jones, 2012). In case telephones do not work, the organization utilizes the radio option during the critical phase of disaster response to communicating and processing of requests within the organization’s leadership command. Mass care communication takes a high priority during the initial stages of disaster response (Jones, 2012). However, it is important to note that some communication might be of a confidential nature and, therefore, not appropriate for transference through an open radio. In such cases, hand delivering such communication is encouraged.

In assessing the extent of damage, the damage assessment communication platform needs to be immediate concerning response, particularly in providing the equipment necessary for survey and reporting. During a disaster outbreak, there is a need to conduct the initial assessment within the first 24 hours or less (Yates & Paquette, 2011). This is critical in determining the extent of the resources that might be required in responding to the disaster. Within the first 72 hours, it is important for responders to have a detailed assessment of damage and the extent of communication equipment needed for effective coordination of teams as well as information transmission across the command system (Yates & Paquette, 2011). Regarding the established health services, including the disaster mental health services, there is a need for a communication system that is characterized by a multi-level structure. Authentically, this means that shelters, emergency aid stations, health service centers, and outreach centers must be operational in a 24-hour format (Yates & Paquette, 2011). Consequently, the established Disaster Welfare Inquiry Center would need radio assistance for coordination when it comes to receiving and responding to inquiries, both on the ground and with the national headquarters.

Globalization and the Role of the American Red Cross

Even though the American Red Cross has its operations majored in the United States, in recent times the organization has expanded its outreach internationally. The globalization phenomenon that has become an essential characteristic of the modern society has played a great role in this move. Today, the world is besieged by a wide range of natural disasters, including seasonal floods, drought and famine, seasonal fires, and life-threatening disease epidemics. These emerging global threats have made the American Red Cross establish a partnership with other Red Cross organizations, such as the Red Cross Crescent, to provide relief and care in regions of the world stricken by these disasters. Services provided to victims include financial assistance, relief food, and other essential supplies, as well as disaster response and recovery personnel. In recent times, the American Red Cross, in partnership with Red Cross organizations in regions devastated by disasters, has participated in providing relief to disaster victims across the world. For example, the organization has offered assistance to victims of tropical storms and floods in Kenya, Uganda, Argentina, Haiti, Canada, Jamaica, Bangladesh, and the Philippines among other countries (Jones, 2012). Additionally, the organization has participated in providing relief to victims of internal civil conflicts and population dislocation in Burundi, the Democratic Republic of Congo, Jordan-Israel, Syria, Lebanon, and Turkey among other regions (Jones, 2012). The organization has also taken part in solving food insecurity threat in Zimbabwe and Malawi, and in responding to life-threatening epidemics, such as the Ebola crisis in Sierra Leone (Jones, 2012). Haiti and China, both of which have been hit hard by earthquakes have also witnessed the work of the American Red Cross on the relief front.

A major effect of globalization that has influenced the work of the American Red Cross, especially outside the United States is technological innovations. In 2008, in partnership with the Kenya and Uganda Red Cross organizations, the American Red Cross used the mobile money platforms to offer financial assistance to flood victims in Kenya and Uganda, respectively (Briones, Kuch, Liu, & Jin, 2011). This essential relief work borrowed heavily from the success that the organization recorded in transmitting financial aid to victims of a major earthquake in Haiti previously (Briones, Kuch, Liu, & Jin, 2011). As noted by the organizations, offering financial assistance to individuals and families devastated by disasters is most effective in meeting the core needs of these populations.

Evaluating the Effectiveness of the Organizational Structure

There is no doubt that the organizational structure of the American Red Cross plays an important role in enhancing the organization’s capacity to meet its federal and relief obligations. However, the first decade of the 21st century witnessed the worst performance in the organization’s boardroom. This negative performance has been impacted by a high rate of turnover at the highest levels of leadership. For example, ever since Elizabeth Dole resigned as chair of the board in 1999, the American Red Cross has had seven different persons assuming the office of the President and Chief Executive Officer. Firstly, Bernadine Healy, who served from 1999 to 2001, was forced to resign on account of mismanagement of disaster response to the 9/11 attacks on the Twin Towers of the World Trade Center in New York. Secondly, Marsha J. Evans, who served from 2002 to 2005, was forced to step down for mishandling disaster response towards Hurricane Katrina (Saunders, 2007). Thirdly, Mark W. Everson, who served briefly from May 29 to November 27, 2007, was forced to step down for inappropriate sexual relations with a subordinate staff member. Indeed, these frequent turnovers at the top-most executive level have significantly weakened the effectiveness of the American Red Cross in achieving its relief and federal mandates. According to observers, even though the constant changes in leadership at the organization are hurting the effectiveness of the US largest charity organization, years of underinvestment in technology and telecommunications, as well as in other infrastructures, is the biggest problem (CBS Interactive Inc., 2016).

Besides constant leadership changes, the American Red Cross has also suffered from notable awards of huge severance packages to ousted executives irrespective of the term of service. The tragedy of this reputation is that the organization is the largest non-profit organization in the nation. Misconduct in international relief efforts and at the local chapters has also tainted negatively the image and reputation of the organization (Sullivan, 2016). For example, the fundraiser stationed in Louisiana was caught fattening her bank account with donations meant for helping victims of disasters, and the manager in charge of the Pennsylvania chapter was accused of embezzling funds to satisfy her cocaine addiction. In Maryland, the executive in charge was accused of forging signatures on purchase orders that were meant to benefit disaster victims. Sadly, the biggest charity frauds in US history recorded at the American Red Cross Hudson County Chapter in New Jersey, where the Chief Executive Joseph Lecowitch and the bookkeeper Catalina Escoto embezzled over one million dollars in gambling. Even though Congress called for changes at the organization to solve problems in the organization’s leadership, an executive at the organization in Orange County pleaded guilty in 2007 to federal charges of embezzlement. Indeed, this tradition of executive misconduct is a clear indication of the problem in the organizational structure of the American Red Cross and its effects on the overall effectiveness of the entity.

Consequently, the American Red Cross faces a multitude of other challenges that negatively impact on its effectiveness as a relief organization. These include constant miscommunication during natural disasters. Case in point is Hurricanes Katrina and Rita, where both the organization and the Federal Emergency Management Authority (FEMA) mishandled communication between themselves (Saunders, 2007). Further, certain quarters have accused the American Red Cross of mismanaging donations and volunteers, two of the most critical resources for the organization (Jones, 2012). During Hurricane Katrina response, several volunteers reported the disappearance of cars and generators that they had rented as well as air mattresses (Saunders, 2007). Another significant challenge for the organization is insufficient capacity, particularly concerning the handling electronic donations. During Hurricane Katrina, for example, the organization’s website was overwhelmed due to the large electronic contributions that were recorded (Saunders, 2007). The same applies to blood donations, where the organization’s blood donation program has over 38 regions with five testing laboratories (Zou et al., 2008). Undeniably, this makes it hard for internal communication between these resources to run smoothly (Zou et al., 2008). Another area of challenge is marketing communication, where the organization struggles with positioning itself as an ethical and transparent non-profit entity in light of recent executive misconducts (Jones, 2012). Further, there are concerns about the types of organizations that the American Red Cross chooses to partner with during disaster outbreaks. Some of these agencies seem to further their marketing and public relations goals instead of extending a helping hand.

In light of these negatives at America’s largest charity organization, there is a need for fundamental changes to restore public faith in the entity to secure donations, which are the primary sources of funding. For starters, the American Red Cross must reduce the perceived risk associated with how it utilizes donations. Vividly, this would require re-establishing public faith in the entity by undertaking fundamental reforms in the organizational structure (Phoocharoon, 2015). Towards this, the organization must recommit its entire workforce, including executives, to work ethics. Additionally, the organization must choose carefully the organizations it forms a partnership with during disaster outbreaks. Maintaining effective and efficient operations when responding to disasters, as well as transparently reporting its accomplishments, opportunities, and failures, is critical to restoring the image of the American Red Cross. Admittedly, as a move to solve communication breakdown with federal and state agencies, it is important for the American Red Cross to develop clear strategies that address noted missteps in interagency communications.

In summary, it is important for the American Red Cross to understand that it has a stakeholder obligation to meet it mandates effectively and efficiently. Considering that donation make up the largest percentage of the organization’s funding sources and the fact that volunteers occupy the most significant proportion of the workforce, the need for effective management is critical (Ariely, Bracha, & Meier, 2009). Reforming the organizational structure at the American Red Cross would bear immediate fruits by reforming leadership at the executive level as well as downwards to every level of leadership (Schaubroeck et al., 2012). More importantly, the organization must continuously review and modify its interaction with agencies at the federal, state, and local levels. Congressional oversight should also be encouraged to ensure that the organization continues to operate within and deliver its federal mandate. To expand its capacity, the American Red Cross should provide disaster relief by partnering with transparent private corporations to offer effective and efficient responses to disaster victims. Further, the organization should undertake joint marketing efforts with private enterprises as long as these associations are founded on ethical principles. However, to ensure that the American Red Cross stays on its established relief and federal mandates, it is critical for staff, donors, volunteers, and the wider society to continuously monitor the activities of the organization to ensure long-term sustainability.

The Positive Impacts of the American Red Cross

Just like any other relief charitable organization anywhere in the world, the American Red Cross plays an important role in responding to natural and human-made catastrophic disasters. As noted in this paper, the organization, since going global, has participated in major relief programs in different parts of the world. Besides providing disaster relief in terms of specialists and supplies, the organization also provides financial assistance to individuals and families devastated by disasters. These disasters range from tropical folds and storms, disease epidemics, civil conflicts and internal displacements, earthquakes, food insecurity, and hurricanes among others.


Disaster relief programs ply an important role in society, especially considering that natural disasters are in most parts unpredictable and uncontrollable. The American Red Cross is one of the most notable charity organizations that provide critical disaster services in the United States and worldwide. However, to be effective, the organization, just like other organizations, must have a stable organizational structure. In essence, the organizational structure dictates the culture of leadership and operation within an organization and, therefore, determines the extent to which an organization attains its goals and objectives (Sergiu, 2015). As far as the American Red Cross is concerned, the board of governors is the top most leadership entity, with a chairperson appointed directly by the President of the United States.

Currently, the organization, besides providing relief to disaster victims, has a federal mandate granted by the US Congress. Even though the organization has faced insurmountable challenges in the past ranging from executive misconduct, mishandling of disaster responses, to miscommunication with federal agencies- there is still a chance for the organization to regain former glory. Reforming the organizational structure would involve re-establishing ethical workmanship at the organization and managing donations and volunteers in the most effective and efficient manner. Undertaking these reforms is critical in enhancing organization performance and effectiveness at America’s largest charity organization.

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