Strategic Business Unit (SBU) is necessary when corporation starts to provide different products and hence, need to follow different strategies.

SBUs are also known as strategy centers, Independent Business Unit or even Strategic Planning Centers.

Strategic Business Unit (SBUs) is necessary when corporation starts to provide different products and hence, need to follow different strategies. To ease its operation, corporate set different groups of product/product line regarding the strategy to follow (in terms of competition, prices, substitutability, style/ quality, and impact of product withdrawal). These strategic groups are called Strategic Business Units (SBUs).

SBUs are also known as strategy centers, Independent Business Unit or even Strategic Planning Centers.

Each Business Unit must meet the following criteria:

1. Have a unique business mission, independent from other SBUs.
2. Have clearly definable set of competitors.
3. Is able to carry out integrative planning relatively independently of other SBUs.
4. Should have a Manager authorized and responsible for its operation.