A business plan is a written document that describes a business, how it operates, and how it makes a profit. It defines the organization, its use of capital resources, and serves as a blueprint for operation and managerial success. It is typically written when the business is started and is updated each year. The business plan usually covers one year of operation. In the business plan is the mission statement, which is the organization’s message to customers about why the business exists. It describes the business, identifies the customers, and shows how the business adds value. Microsoft’s corporate mission statement is “to empower every person and every organization on the planet to achieve more.” Management also reviews the vision statement in the business plan. A vision statement is what the business aspires to accomplish. The vision statement is like looking into a crystal ball and seeing the future of the company. Google’s vision statement is “to provide access to the world’s information in one click.” A good vision statement should inspire employees and help drive the business to success. Reviewing the mission and vision statements enable management to prioritize strategies to keep the organization focused on its purpose. This step reminds management why they are planning and where they want to go in the future. Establish Organizational Goals During the strategic planning process, managers set high-level goals for the whole organization to reach. Some examples include company acquisitions, facilities, and other plans to grow or otherwise position the business. Each year, senior management sets goals generally for one to five years to accomplish what the owners expect from operations. Owners expect challenging but reasonable goals that can be met. wavebreakmedia/Shutterstock.com A strategic plan is designed to achieve the long-term goals of an organization. Why is it necessary for a business to look into the future and set long-term goals? You Do the Math Geometric Reasoning: Area The area of a two-dimensional shape considers measurements of its perimeter. The area of a rectangle, for example, is calculated by multiplying the length of two sides that meet at a right angle. The area of a circle is calculated by multiplying the constant pi (3.14) by the radius of the circle squared. Solve the following problems. 1. A facilities manager must calculate the area of a parking lot in order to estimate the cost of repaving it. The parking lot measures 75 feet by 125 feet. What is the area of the parking lot? 2. A manager must calculate the area of a conference room in order to estimate the cost of installing new carpeting. The room measures 17 feet by 23 feet. What is the area of the conference room? 3. Plywood must be purchased to cover a space that is 12 feet by 25 feet. One sheet of plywood is 4 feet by 8 feet. How many sheets of plywood must be purchased? Round up to the nearest whole sheet. Principles of Management 46 Copyright Goodheart-Willcox Co., Inc.