1)    When the Organization having multiple products grows very large, it is broken down into separate units, which operates as a profit centre by itself


2)    To be called an SBU, it should meet the following criteria:

  1. Have its own mission
  2. Have definable groups of competitors
  3. Prepare its own integrative plans
  4. Manage its own resources
  5. Have proper size, neither too large, nor too small

3)    Each SBU is headed by a Head

Has its own advantages & disadvantages

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