American Red Cross (ARC)
The impact of this event on ARC's "benefits of business ethics"
Hurricane Katrina and the September 11 disasters had an adverse effect on the benefits of business ethics of ARC. The absence of commitment and unsuitable conduct by the workers and volunteers damaged the company's reputation. The workers and volunteers were alleged of unethical tendencies such as taking funds, lying and stealing other contributions intended for relief initiatives. For instance, Catalina Escoto escaped with over one million U.S. dollars that belonged to Red Cross funds. She spent this money in gambling shopping for gifts and she awarded herself $75,000 as bonus. There was missing the dedication on the part of workers and volunteers to the regulations and policies institutionalized to regulate the running of the company. This was because of American Red Cross inability to integrate any ethical laws for its workers and volunteers in its Ethics Policies and rules (Veenema, 2007). These policies and rules not only ignored employees' moral training but also failed to demand conformity to the specified doctrines. In the lack of the above, it is obvious that workers will require dedication to the organization's activities.
Besides employee commitment, customer satisfaction was severely damaged. During the events, the victims and their families were the customers of ARC, who either required donations or bought the basic needs of life. Even with the expanded system in the involved area, ARC noticed that it lacked skilled and qualified volunteers to deal with logistic matters. The routine catastrophe management was pressured when it experienced the scale of Hurricane Katrina. Due to the recruitment of inexperienced volunteers who were having first-time experience, few customer care reviews recommended that volunteers complain about being assigned with tasks they had not done previously. In addition, many volunteers patiently...
The mismanagement of contributions hurt the commitment of investors towards the company. After the 9/11 2001 terror attack, ARC collected thousand units of blood that were rarely used. Just after 48 hours of the catastrophe, ARC collected 400,000 units of blood but because of the frequent death of victims, the excess amount was destroyed (Veenema, 2007). Despite talking about situation to the then President Bush's government and the U.S. Food and Drug Administration, ARC failed to inform its blood contributors. The donors needed a guarantee from one of the earliest national non-profit company, for their participation in terms of blood and money. This situation caused a loss of investors' commitment towards ARC, and they required a fair distribution of funds they contributed for the victims of 9/11 catastrophes. The part of the stakeholders' attention in any company is to form the organizations' goals and objectives in such a way that their passions are met. However, ARC tried to protect the use of cash for other needs but public pressure forced them to channel all money to the victims and their families.
The role that ARC's stakeholder orientation played in this scenario
Stakeholder orientation refers to the level at which a company understands and fulfills stakeholder demands. Stakeholders comprise of shareholders, customers, employees, investors, suppliers communities and government agencies. In the scenario of ARC, there are many concerns. The organization's mission is to bring aid to disaster victims. Hurricane Katrina and the World Trade Center attack were significant events that affected the U.S. The ARC was seriously criticized because of how they handled these occasions.
In the Hurricane Katrina case, the reputation of ARC was likewise…
