The former CEO of Sam's Club, a division with its own profit-and-loss responsibility, Rosalind Brewer, reported to Walmart's CEO, C. Douglas McMillon, who as corporate executive oversees Walmart's entire operations. Sam's Club, therefore, is a strategic business unit of Walmart.
Explanation:
A strategic business unit is a revenue generator that operates on the commodity and customer divisions. SBUs generally have a confidential marketing strategy, industry research and advertising campaign, although they can be part of a huge organization.
SBU's best illustration was businesses such as Proctor & Gamble, LG etc. Such organizations have various categories of goods under one structure.
As a product, for example, LG keeps customers competitive.
It manufactures refrigerators, air conditioning and TVs. Such smaller units form distinct SBUs to allow for an autonomous control of sales, costs and profits. Once an institution has an SBU designation, they will take their own decisions, finances, budgets and so on. This will respond quickly when the brand price rises or changes begin before the change occurs.
