Children's Miracle Network OverviewResearch Paper

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Children's Miracle Network was founded in 1983, and is headquartered in Salt Lake City. The charity operates in the United States and Canada. The organization raises funds for children's hospitals -- its numbers say 170 of them across the United States (CMNH, 2015). The organization is a not-for-profit agency. The agency began with a small televised fundraiser, run by Marie Osmond and John Schneider. Osmond was a well-known singer and Schneider was an actor coming off a successful run with The Dukes of Hazzard. The initial team had 20 hospitals, 20 television stations and six sponsors (CMNH, 2015). The celebrity power of the founders helped that initial television fundraiser to become a success, and the Children's Miracle Network grew from there to its current size.

Mission and Vision

The Children's Miracle Network has maintained the same operating mandate for its entire existence, which is to raise funds for children's hospitals, which are often separate facilities from regular hospitals that focus on adult care. Children's hospitals have medical staff and facilities that cater to the unique needs of child patients and their families. The charity was founded to help these facilities to bridge funding gaps and to improve the quality of children's care. Evidence shows that on average, the unique mission of children's hospitals results in a higher cost of care (Merenstein, Egleston & West, 2005) for which payers -- be they government or insurance -- do not always accommodate.

The stated mission of the Children's Miracle Network is "to raise funds and awareness for local children's hospitals" and the vision is "Together we can save kids' lives." The organization has maintained this mission, without distraction, since it was first created. The organization's focus on local is important. It started with 20 hospitals and 20 television stations, and the strategy is to raise funds in a metro area by focusing on the nearby children's hospital. Most metro areas will have such a hospital. The CMN is aware that people are more likely to donate when the funds are going to be used in their area. While Children's hospitals have always sought charitable donations, the CMN created an organization arm and campaign to solicit for such donations. This also gives the people in an area an opportunity to help the children in their state or city, in a way that they can trust. In essence, the CMN makes it easy for people to donate, and to know exactly where their donation is going, because the donor can readily associate the donation with the local children's hospital.

Internal and External Assessments

The Children's Miracle Network has retained its status as a registered charity, even as it has grown. The organization raises revenue of around $250 million annually. This makes it a mid-sized charity. The largest charity in the U.S., the United Way, raised $4.266 billion in 2014 and St. Jude's Children's Research Hospital alone raised $1.287 billion.

The President and CEO is John Lauck, who has served in this position since January 2011. His experience prior was with Mrs. Fields, Arby's and Pizza Hut. The Chief People Officer is Janet Debartolo, who joined the network in 1998 and has built her career on the human resources side of the CMN. The head of the Canadian subsidiary is John Hartman -- this branch raises $50 million annually. Chief Administration Office Teri Nestel joined CMN in 1989 and has built her career since then. Steve Oshin is the Chief Programs and Events Officer and comes to CMN from the radio business. The Chief Hospital Relations Officer is Shirley Rogers, who joined the organization in 1994. The Chief Concepts Officer is Craig Sorensen, who has been with CMN since 1995. Clark Sweat is the Chief Corporate Partnership Officer, and has been with CMN for 19 years. As these bios illustrate, many members of the current executive have long tenures with CMN, while a few have joined the company from outside, including the current CEO.

Charity Navigator is an agency that examines the internal workings of charities, in particular to provide information about whether or not a charity is spending its money efficiently. Charity Navigator (2015) gives the Children's Miracle Network a four star score overall, with a score of 94.2 out of 100. The charity received a 91.91 on the financial component and 100 on the accountability and transparency. Overall, these are very good score, implying that the Children's Miracle Network is well-organized and that it spends its money efficiently.

Administrative expenses are 7.2% of total outflows, while program expenses are 90.6%. Fundraising expenses are 2.1%. These are average to good scores in general, and would not pose any major issues or concerns for potential donors. The main area of financial concern is that the program expense growth was 3.6%, while the primary revenue growth was just 0.7%. For the past year, the shortfall was $300,000, which is not severe given the size of the organization, but the CMN will need to either raise more money or curtail spending somewhat going forward in order to balance its budget (Charity Navigator, 2015).

What these assessments confirm is that the Children's Miracle Network is, in general, a well-run charity that meets its objectives of raising funds for children's hospitals, and then donates those funds. A donor can trust that the network is not squandering the money that they give the network, and that the funds are being used for children's hospitals.

Identification of Stakeholders

There are several stakeholders for the Children's Miracle Network. There are a number of internal stakeholders. There are a hundreds of employees and volunteers who work for CMN, both on the administrative side of the business, but also in terms of helping to put on fundraising events. These volunteers have a stake in the labor and emotional commitment that they have put into the charity. That applies to employees as well, but they also have their livelihoods invested in the charity.

The donors are another stakeholder group. Donors are both private and corporate. When a donor puts money into a charity, they have a reasonable expectation that the money will go to the cause for which they have donated. In this case, that is to children's hospitals, or even more specifically to the local one. The local nature of the charity is one of its primary selling points. Donors have the option to donate to any charity that they see fit, and because of that there is incentive for CMN to ensure that donors are satisfied with the way that the charity handles their money, and with the service that they give the donors.

Another external stakeholders is the hospitals. Children's hospitals, as noted, tend to run higher costs than other hospitals. Thus, they are often dependent on charitable donations and grants in order to make up this shortfall, so that they are able to effectively attend to the unique needs of children. Many of the hospitals with which CMN works -- and there are 170 of them -- have been with the organization for years, and depend on the funding that they get from CMN to balance their budgets.

The children and their families are naturally a major stakeholder. CMN exists to meet their needs, and they market themselves as such. These are sick children, who need the best care possible. The funding that children's hospitals receive from CMN is one part of that equation, but it can be an important part. For children and their families, this funding can be life or death, so this is arguable the most important stakeholder in the charity. There are other, more minor, stakeholders, such as the television stations on which the telethons are aired, but these stakeholders are less important that the ones named above.

Overview of Services Provided

The CMN does not provide services; rather, it provides money. The function of the organization is to raise funds, and the disperse them. That is the service that CMN provides, to act as an intermediary between people who want to donate to charity and a specific set of organizations that would like to receive charitable donations. The actual work of helping children is then done by the same hospitals to which CMN turns over the donations. Charity Navigator notes that the programs receive 90.6% of funds, which while not a great number is perfectly reasonable given the size and scope of the Children's Miracle Network. For comparison purposes, this is the same number as the global United Way has, so it is a fair and reasonable performance.

Competencies and Resources

That the Children's Miracle Network has done the same thing for its entire existence gives it a high level of competency. The organization has built strong relationships with hospitals and with corporate sponsors over the years, and this has allowed it to run an efficient operation and move substantial amounts of money to these hospitals. These contacts make up a considerable resource, especially considering the long tenures with CMN that some of the key people in… [END OF PREVIEW]

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