Strategic business unit (SBU)

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strategic (adjective, stra-te-gic, \ strəˈtiːdʒɪk \) business (noun, busi-ness, \ ˈbɪznəs \) unit (noun, u-nit, \ ˈjuːnɪt \)

Definition: is a part (branch or product line) of a bigger organization that is small enough to have a separate mission and goals, and which can be developed and marketed independently from other units. Due to its more flexible nature, a strategic business unit can be easily changed to align with the trends occurring in the economic and market environments, while still remaining an integrated part of a larger company. An SBU ordinarily possesses its own infrastructure including staff and HR department.

In a Sentence:

  1. The creation of a separate strategic business unit is an essential step in the development of a company that intends to diversify its product line.
  2. The world’s leading IT firm has created a new strategic business unit in Copenhagen to streamline the process of conquering the Danish market.

Synonyms and related words: profit center, segmentation, division, marketing team, cost center