Thursday, January 31, 2013

Why is identification of SBU important?


It is important to remember that competitive strategy in an organization is created in the separate business units of the organization. Most organizations have a number of business units, which are competing in different markets, where customers or clients have different needs and require different products or services. So to understand business-level strategy it is important to be able to identify the SBUs in an organization.

Definition : A strategic business unit is a part of an organization for which there is a distinct external market for goods or services that is different from another SBU.

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