Strategic business unit

A SBU is generally defined by what it has in common, as well as the traditional aspects defined by McKinsey: separate competitors; and a profitability bottom line. Four commonalities include: • Revenue SBU • Like Marketing Cost SBU • Like Operations/HR Profit SBU • Like sales judged on net sales not gross ==Success factors==

There are three factors that are generally seen as determining the success of an SBU: • the degree of autonomy given to each SBU manager. • the degree to which an SBU shares functional programs and facilities with other SBUs. • the way in which the corporation handles new changes in the market. ==BCG matrix==

The BCG Matrix, a chart designed by Bruce Henderson for the Boston Consulting Group in 1968, may help corporations to analyze their business units or product lines. This helps the company allocate resources; brand marketing, product management, strategic management, and portfolio analysis can use it as an analytical tool. When using this matrix, SBUs can appear within any of the four quadrants (Star, Question Mark, Cash Cow, Dog) as a circle whose area represents their size. With different colors, competitors may also be shown. The precise location is determined by the two axes, market Growth as the Y axis, Market Share as the X axis. Alternatively, changes over or two years can be shown by shading or other differences in design.xx. Star products currently have high growth and high market-share. The Question Mark identifies products with low share but high growth. A Cash Cow has high share but low growth. Finally, Dog labels a product which has low growth and low share. ==See also==