Running Head SETTING A BUDGET1SETTING A BUDGET 6.docx
- 1. Running Head: SETTING A BUDGET 1 SETTING A BUDGET 6 SETTING A BUDGET Ashley Cook HMSV8304 The American Red Cross is an organization with immeasurable commitment to provision of compassionate care to people who are in need in America. As such, this is their mission and their budget epitomizes this. The largest chunk of the income that is mainly received from grants from governments and organizations as well as donations from organizations is spent on humanitarian activities. For the year 2018, 91.85% of the $0.5 billion that was raised from the aforementioned sources was used in humanitarian activities. These included helping people who needed care in in disasters in the shortest notice, ensuring and maintaining community health especially by being in the frontline to deliver blood to
- 2. patients who needed it in our health facilities. The organization recognizes the importance of mitigating disasters before they happen and therefore set aside $1,659,000 that was used to keep teams ready to stop a disaster before it happened or minimize injury or loss of life as much as possible. This is in line with the organizations principle of being proactive rather than react to disasters when they happen. The American Red Cross has a total 12,534 permanent employees spread all over the nation to offer humanitarian help whenever and wherever it is needed (Hutchinson, 2018). These are selfless individuals who are always risking their lives to save others’. The organization therefore aims at giving the employees the best working conditions given the circumstances and making sure that they stay safe as much as possible while delivering help. As such, American Red Cross buys the best equipment and vehicles to help the employees as well as volunteers in humanitarian work to get to sites of disasters in the shortest time possible and safely. This is why the company has invested in top notch ambulances that have lifesaving equipment that may be used by the employees to save lives in an occurrence of a disaster. As indicated above, funds that are used by the organization to finance its operations as well as management are received from state and federal government, and international organizations as grants or from the public as donations. Often times, the funders wish to know how the funds that they give out the cause of saving human lives through humanitarian assistance is used (Schnupp & Möller 2018). The organization therefore posts its official budget on its official website where it can be accessed by all people. In the last 5 years, the donations have been on the rise and this is a good indicator that the people who fund the organizations are happy about how the money they give to it is being used. One of the key strengths in the company is the manner in which the employees relate with each other and the organization at
- 3. large. The organization appreciates the selflessness of the people working there. As such, employee retreats are held twice a year to give the employees a chance to feel appreciated for the work that they do (Peterson, 2018). This has gone a long way in instilling a very good organizational culture and this is especially seen in the manner at which employees are motivated to do their work (Slater et al, 2019). The organization intends to become even more proactive going forward and with an employee base that is motivated to work selflessly and an inclusion of disaster preparedness fund in the budget, this is very achievable (Barr& McClellan, 2018). Budgets are very important when it comes to the effectiveness of an organization. For instance, budgets allow an organizational to keep its eyes on the target. Budgets serves as reminders of objectives and offers direction towards which money should be spent. In that way, it makes the organizational follow its stipulated strategy to achieve its goals. Budgets also come in handy in transparency within the organization (Sorenson & Goldsmith 2017). Every organizations budget contains minute details of what activities should be done in line with its objectives. After this, every department has its own allocated amounts and the activities that are taken are checked against their budget allocations to ensure transparency (Miller, 2018). In such organizations as the American Red Cross that receive funds from donors, the budget provides information regarding the expenditure of that money and indicates where money is going (Akai & Sato, 2019). Lastly, budgets are important in that they ensure that an organization is operating within the realms of the available funds and efficiently at that. It would be difficult for any organization to operate without going back to a budget for a direction regarding expenditure. Often times, it would commonplace to find expenditure exceeding the available funds (Yuliansyah & Khan, 2017). Thankfully, budgets restrain activities within available funds. On top of that, when there is a budget, funds are used more efficiently (Brown et al, 2016).
- 4. In conclusion, budgets play an invaluable role towards successful realization of organization objectives. References Akai, N., & Sato, M. (2019). The role of matching grants as a commitment device in the federation model with a repeated soft budget setting. Economics of Governance, 20(1), 23-39. Barr, M. J., & McClellan, G. S. (2018). Budgets and financial management in higher education. John Wiley & Sons. Brown, J. L., Fisher, J. G., Peffer, S. A., & Sprinkle, G. B. (2016). The effect of budget framing and budget-setting process on managerial reporting. Journal of Management Accounting Research, 29(1), 31-44. Hutchinson, J. (2018). Champions of charity: war and the rise of the Red Cross. Routledge. Miller, G. (2018). Performance based budgeting. Routledge. Peterson, A. K. (2018). The Role of Organizational Culture in Donor Recruitment at the American Red Cross. Metamorphosis. Schnupp, C., & Möller, K. (2018). Capital budgeting optimization through process design. Controlling, 30(6), 13-21. Slater, S., Bogard, B., Clark, A., & Reed, K. (2019). American Red Cross Home Fire Safety Campaign. Sorenson, R. D., & Goldsmith, L. M. (2017). The principal's guide to school budgeting. Corwin Press. Yuliansyah, Y., & Khan, A. A. (2017). A revisit of the participative bu ActivityAmount Grants300000 Donations200000 Total500000 Humanatarian Activities459255 Disaster Preparedness16590 Personnel Salaries 10000 Consultancy Fees5000
- 5. Epenses on goods Vehicle100 Software50 Insurance2000 Rent2000 Telephone5 Epenses on services Personnel Transport1000 Personnel Meals1000 Employee Retreats1000 Hotel fees1000 Miscellaneous support.1000 Total500000 Income Expenses Budget For The American Red Cross for the year 2018 (Amounts are in thousand USD) Sheet1Budget For The American Red Cross for the year 2018 (Amounts are in thousand USD)IncomeActivityAmountGrants300000Donations200000Tot al500000ExpensesHumanatarian Activities459255Disaster Preparedness16590Personnel Salaries 10000Consultancy Fees5000Epenses on goodsVehicle100Software50Insurance2000Rent2000Telephone5 Epenses on servicesPersonnel Transport1000Personnel Meals1000Employee Retreats1000Hotel fees1000Miscellaneous support.1000Total500000 SWOT Analysis and PEST Analysis
- 6. Ashley Cook HMSV8304 May 12, 2019 Roger Morton Introduction The American Red Cross is also known as the American National Red Cross which is a charitable firm which is purposely offering the emergency helps, the catastrophe assistance, and the disaster vigilance education within the United States. This agency was established in May 1881 by the person knows as Clara Barton. The main reasons for the formation of the American Red Cross were to assists the Americans who were in distress. The founder who is Clara allowed for the volunteerism to occur thus ensuring that the suffering within the American society is significantly reduced. This organization is under the management of the volunteers of the public for the sake of offering the services to the members of the public. This organization is of great importance because
- 7. it helps people especially during the occurrences of the natural or the man dame calamities which are likely to prevent people from living their normal way of lives (Cross, 2011). The American Red Cross is known as a non-profit organization which is mostly known for the emergencies occurrence on the basis of controlling, planning and the management process. Since the organization does not usually sell any services or products for profit, then it always has to manage the budgeting process very economically so as to ensure that all the crisis and the emergencies are handled well. The American Red Cross is able to do this by planning effectively using both a SWOT and PEST Analysis. SWOT Analysis The SWOT analysis was invented in order to help organizations in defining their strategies in the backdrop of the dynamic and increasingly competitive business environment. The name was derived from the fact that it is used to examine the strengths as well as weaknesses of a given organization. The matrix below provides a clear overview over the organization. The matrix identifies that the American Red Cross has a strong brand equity, long history and the organization is thoroughly fulfilling their mission by serving those in great disasters. The organization can also be developed in areas that relate to labor relations, as the organization is known for poor and unfair treatment to employees. The organization also has a limited amount of funds which prevent them from being able to support all of their employees the way they should. The SWOT identifies several strengths and weakness of the organization but the matrix also highlights many growth opportunities and areas that can or may be threats. It has been projected that the American Red Cross organization can join forces and collaborate with other elite organization to gain even more exposure, but to consider the logical threats that include growing competition. PEST Analysis The PEST analysis is a strategic management tool used to
- 8. analyze internal and external factors that impact the situations in the American Red Cross blood services for the Northeast Region. PEST is short for PESTEL, which stands for: Political, Social, Economic, Technological, Environmental and Legal Factors. Each category allows the organization to see identified macro environment of the organization that it operates in. The Matrix below identifies how the present governed system is keeping a close eye on the American Red Cross. The matrix also highlights on certain economic factors affect the organization. One major aspect as it relates to economics for the American Red Cross is the fact that if the government intervenes in the finance and accounting sector for this organization and similar competitors it could impact their organization in a major way. Each of the categories identify major elements that could have a major impact on the organization. Conclusion Both SWOT and PEST analysis are conducted to help organizations in planning their business strategy as well as execute them. The SWOT helps to plan the strengths, weakness, opportunities, threats for a business and the PEST helps to come up with the political economic, social and technological factors that should be looked at in a business. Both of these analysis have added benefits for any organizations using them. They both help implement programs effectively, adopt internal and external factors, helps simplify strategic planning and most of all help guarantee the overall success of an organization.
- 9. SWOT PEST Strengths Political Factors · American Red Cross is very famous brand and it’s well known in whole world. It has very strong brand value in the market and whenever there is any situation the first name in mind come up is Red Cross. Red Cross’s famous line ‘Together, we can save a life’ represent the trust amongst people and its popularity amongst them. · Government resource allocation and time scale – Based on the data in the American Red Cross Blood Services: Northeast Region it is difficult to infer that there will be change in resource allocations. · Red Cross have long standing history to serve the people in many great disasters and established the name in NGO industries as one of the finest service providers. They have better serve the people and won millions hearts. · Changing policies with new government – We can make an inference after reading the American Red Cross Blood Services: Northeast Region that there can be a transition of government in near future in most prominent market. Blood Ner has to prepare for this eventuality as it can lead to change of priorities for the sector. · Red Cross is also famous for its volunteer support and number
- 10. of support base they have created which no one can achieve that much easily. · Other stakeholders such as non-government organizations, protest & pressure groups, activist movements play critical role in policy making in Finance & Accounting. Blood Ner should closely collaborate with these organizations so that it can contribute better to the community goals as well as with corporate goals. Weakness · Taxation policies – Over the last two decades Blood Ner has benefitted from lower taxation policies throughout the western hemisphere. It has resulted in high profits and increasing spending in the research and development. In the second half Robert L. Simons, Hilary A. Weston believe that it can change · Red Cross has been in limelight for the same last year that they have handled their workers very poorly and been criticized for that reason. They have laid off staff member because of budget deficit. Economic Factors · They were also in news because they have allegation of misusing the fund so much poorly. Mismanagement of fund issues has spoiled their reputation amongst public. · Increasing liberalization of trade policy can help Blood Ner to invest further into the regions which are so far off-limits to the firm. · American Red Cross does not have online existence and no one cannot enroll for their course and it does not have any kind of innovation in their service or program. · Economic Cycles – The performance of Blood Ner in Finance & Accounting is closely correlated to the economic performance of the country it is present in. Opportunities
- 11. · Downward pressure on consumer spending – Even though the consumer disposable income has remain stable, the growing inequality in the society will negatively impact consumer sentiment and thus impact consumer spending behavior. · Red Cross can have exposure by joining any elite organization which is not involved in politics and can expand its operation to serve the American and other continents effectively. · As like The American Red Cross no organization provide the blood donation so that they can enjoy this fact and can have advantages in this program and reach to millions through this campaigns. · Economic Performance of Blood Ner – I believe the economic performance of the markets that the firm is present in - grow above 9-10% because of increasing government expenditure, increasing disposable income, and increasing investment into the sector. · They can innovate their organization and make sure to enjoy their competitive advantages in NGO industry. · Availability of core infrastructure – Based on data provided in American Red Cross Blood Services: Northeast Region case study, the government has increased the investment in developing core infrastructure to facilitate and improve business environment. Blood Ner can use it to penetrate tier 2 and tier 3 markets. Threats Social Factors · The American Red Cross is facing stiff competition from different NGO organization which have better facilities and vast reach, they also have ultra-modern facilities. · Education level – The education level is high in the Blood Ner existing markets. Based on evidences in American Red Cross Blood Services: Northeast Region case study, you can suggest
- 12. building a R&D center in the local market · The American Red cross have been affected by the government policies and tax policies and as they have to manage their fund. · Leisure interests – the customers that Blood Ner targets give a very high preference to experiential products and services. The firm needs to spend more energy to meet the preferences and expectations. · Societal norms and hierarchy – the society as portrayed in the American Red Cross Blood Services: Northeast Region case study is different from the home market of Blood Ner. It should strive to build a local team that understands the societal norms and attitudes better to serve the customers · Media outlets play a critical role in influencing the public opinion. Both traditional media and social media are rapidly growing, Blood Ner can leverage this trend to build efficient marketing network. · Attitude towards health and safety – With increasing liberalization the attitude towards health and safety are getting lax. Blood Ner needs to stay away from these attitudes as the cost of failure is too high. · Access to essential services – According to American Red Cross Blood Services: Northeast Region case study - In the last decade and half the wider population in getting access to essential services. This has been a result of increasing investment in public services. Technological Factors · Research and development investment at both macro level and micro level in Finance & Accounting is increasing. It can lead to industrywide disruption through innovation of new products
- 13. & services. · Intellectual property rights and patents protection – If Blood Ner and the sector as whole will have higher safeguards for IPR and other intellectual property rights then more players are likely to invest into research and development. · Lowering cost of production – The latest technology is fast lowering production and servicing cost in the Finance & Accounting sector. Blood Ner has to restructure its supply chain to bring in more flexibility to meet both customer needs and cost structures. · Empowerment of supply chain partners – Technology has shortened the product life cycle and it has enabled suppliers to quickly develop new products. This has put pressure on Blood Ner marketing department to keep the suppliers happy by promoting diverse range of products. It has added to the cost of operations of the Blood Ner · 5G and its potential – Blood Ner has to keep a close eye on the development and enhancement of user experience with increasing speed and access. This can completely transform the customer user experience in the Finance & Accounting industry. · Technological innovation is fast disrupting the supply chain model of Blood Ner as it is providing greater access to information to channel partners, leading to higher profit sharing. Environmental Factors · Waste management especially for units close to the urban cities has taken increasing importance for players such as Blood Ner. Government are fast coming up with strict norms for waste management in the urban areas.
- 14. · Paris Climate Agreement has put real targets for the national governments. This can result in greater scrutiny of environmental standards for Blood Ner in both developed and emerging markets. · Renewable technology is also another interesting area for Blood Ner. It can leverage the trends in this sector. Many governments are providing subsidies to invest in the renewable sector. · Regular scrutiny by environmental agencies is also adding to the cost of operations of the Blood Ner. · Customer activism – Greater awareness among customers have also put environmental factors at the center of Blood Ner strategy. Customers expects Blood Ner to adhere to not only legal standards but also to exceed them to become responsible stakeholder in the community. · Extreme weather is also adding to the cost of operations of the Blood Ner as it has to invest in making its supply chain more flexible. Legal Factors · Business Laws – The business laws procedure that government follows. Are these norms consistent with international institutions such as World Trading Organization, European Union etc. · Environment Laws and guides – The level of environmental laws in the country and what Blood Ner needs to do to meet those laws and regulations. · Health and safety norms in the country and what Blood Ner
- 15. needs to do to meet those norms and what will be the cost of meeting those norms · Employment law in the country and how they are impacting the business model of the Finance & Accounting sector. Can these conditions be replicated or bettered in international market? · Legal protection of intellectual property, patents, copyrights, and other IPR rights in various countries. How Blood Ner will be impacted if there is not enough protection. References Schindler, C. E. (2018). Early Public-Private Partnerships for Public Diplomacy. In The Origins of Public Diplomacy in US Statecraft (pp. 111-144). Palgrave Macmillan, Cham. Cross, R. (2011). American Red Cross. Washington, DC 50. Bryson, J.M. (2018). Strategic Planning for Public and Nonprofit Organizations: A guide to strengthening and
- 16. sustaining organizational achievement (5th ed.). Hoboken, NJ: Wiley. American Red Cross American Red Cross Ashley Cook HMSV8304 April 24, 2019 Introduction The American Red Cross is also known as the American National Red Cross which is a charitable firm which is purposely offering the emergency helps, the catastrophe assistance, and the disaster vigilance education within the United States. This agency was established in May 1881 by the person knows as Clara Barton. The main reasons for the formation of the American Red Cross were to assists the Americans who were in distress. The founder who is Clara allowed for the volunteerism to occur thus ensuring that the suffering within the American society is significantly reduced.
- 17. This organization is under the management of the volunteers of the public for the sake of offering the services to the members of the public. This organization is of great importance because it helps people especially during the occurrences of the natural or the man dame calamities which are likely to prevent people from living their normal way of lives (Cross, 2011). The American Red Cross is known as a non-profit organization which is mostly known for the emergencies occurrence on the basis of controlling, planning and the management process. Since the organization does not usually sell any services or products for profit, then it always has to manage the budgeting process very economically so as to ensure that all the crisis and the emergencies are handled well. Mission Statement and Vision The universality of the American Red Cross is facilitated by the ability to have equal responsibilities and status with all the societies in the entire country. On the other hand, the organization’s vision statement is that “Through the connections it has with different donors, partners and volunteers it has been available to help the members of the society in case of occurrence of disasters”. As a result of its dedication to serve the members of the public, the organization has made different efforts which have ensured that the people affected by the disasters in the United States as well as the other countries in the entire world receive quality care, hope through guidance and counseling and shelter which enable them to live high standard lives as they lived before. The communities of the American Red Cross are always prepared to handle any form. This plays an important role as it makes it easy for the people access lifesaving blood, blood products and safe services especially when their experience healthy issues in the country. (Tabors, 2018) Strategic Plan This organization is well known for the relief they give to the people after they experience the disasters. It was founded in May 1881 by Clara Barton for the sake of helping the American
- 18. who is in distress. The founder therefore paved way for the volunteerism to happen hence ensuring that the suffering amongst the members of the public is reduced significantly. The organization’s effectiveness if facilitated by professionals such as the doctors, nurses, surgeons and the fire fighters who provide servant leadership in their practices to ensure that the people receive quality services. However, the manner in which the organization is operated is controlled by its mission statement which is as follows, “The organization ensures that human suffering is prevented and alleviated in times of occurrence of emergencies by encouraging different people to volunteer themselves with the help of generosity as their controlling virtue”. The stringent principals used by the organization do not encourage dislikes, discrimination, negativity and prejudice as that would hinder the effectiveness of the delivery of the services to the members of the public. Moreover, the American Red Cross’ servant leadership by the members ensures that humanity is encouraged therefore ensuring that the people’s lives are protected through the respect to the people being provided with the services. It provides effective priority in the cases which are the most urgent by not condoning discrimination of the people. Again, neutrality, impartiality, voluntary services and independence are encouraged amongst the member so as to ensure that the people in the society receive the best from the organization. The independence of the organization ensures that it maintains the needed autonomy by abiding by the laws of the country. This enables it to receive enough support from the government therefore making it easy for it to deliver services to the people in the entire country. The relief movement by the organization encourages the servant leadership by the members thus ensuring that the voluntary work is carried out effectively. The universality of the American Red Cross is facilitated by the ability to have equal responsibilities and status with all the societies in the entire country. On the other hand, the
- 19. organization’s vision statement is that “Through the connections it has with different donors, partners and volunteers it has been available to help the members of the society in case of occurrence of disasters”. As a result of its dedication to serve the members of the public, the organization has made different efforts which have ensured that the people affected by the disasters in the United States as well as the other countries in the entire world receive quality care, hope through guidance and counseling and shelter which enable them to live high standard lives as they lived before. The communities of the American Red Cross are always prepared to handle any form. This plays an important role as it makes it easy for the people access lifesaving blood, blood products and safe services especially when their experience healthy issues in the country. (Tabors, 2018) The values of the leaders in the organization play significant roles in ensuring that the manner in which the delivery of services is carried out conforms to the policies of the organization. The American Red Cross should therefore develop strategies in which the beneficiaries of the services provided by the organization are involved in the delivery of the services to the other suffering individuals in the society. The values of leadership theory ensure that the leaders work without having to be supervised by the superiors in the organization. (Schindler, 2018)
- 20. References Schindler, C. E. (2018). Early Public-Private Partnerships for Public Diplomacy. In The Origins of Public Diplomacy in US Statecraft (pp. 111-144). Palgrave Macmillan, Cham. Tabors, C. (2018). A Voice for the" Least of These:" Eleanor Roosevelt's Servant Leadership. Servant Leadership: Theory & Practice, 5(1), 2. Cross, R. (2011). American Red Cross. Washington, DC 50.