Strategic Business Unit Mary Carnahan HA 406: Business Policy and Strategy February 6, 2016 Introduction In this paper I will explain the differences in strategies formulated at the corporate and at the SBU levels. Take a look at the strategic responsibilities of the top executives of individual SBU’s. Are some of these more important than the others? What is SBU? SBU stands for Strategic Business Unit. What does this mean? Strategic Business Unit is a separately managed division or unit of an enterprise with strategic objectives that is both distinct from the parent unit and integral to the overall performance of the enterprise. An SBU is typically created to target a specific market or business concern which requires a production or management specialty not contained within the parent organization (WebFinance, 2016). Functional strategies include marketing strategies, new product development strategies, human resource strategies, financial strategies, legal strategies, supply-chain strategies, and information technology management strategies. The emphasis is on short-term and medium-term plans and is limited to the domain of each …show more content…
SBUs typically have a discrete marketing plan, analysis of competition, and marketing campaign, even though they may be part of a larger business entity. An SBU may be a business unit within a larger corporation or it may be a business unto itself. Corporations may be composed of multiple SBUs, each of which is responsible for its own profitability. General Electric is an example of a company with this sort of business organization. SBUs are able to affect most factors which influence their performance. Managed as separate businesses, they are responsible to a parent corporation. Companies today often use the word segmentation or division when referring to SBUs or an aggregation of SBUs that share such