The Essential Strategic Business Units

Mandatory Business Units for any Startup or MSME (India)

LRC – Legal Regulatory and Compliance Requirements.

R&D – Research and Development

HR – Human Resources

These are indeed the essential strategic business units (SBUs) for any MSME. Each SBU plays a crucial role in the success and sustainability of the organization.

Here’s a breakdown of each SBU’s function:


  • Responsible for developing and implementing marketing strategies to identify, attract, and retain customers.
  • Defines the target audience and develops messaging that resonates with them.
  • Manages branding, advertising, public relations, and other marketing activities.


  • Focused on selling the MSME’s products or services and generating revenue.
  • Builds relationships with customers, identifies their needs, and proposes solutions.
  • Negotiates deals and closes sales.


  • Oversees the production and delivery of goods or services.
  • Manages resources efficiently, optimizes processes, and ensures quality control.
  • Drives continuous improvement and innovation in operations.

Human Resources:

  • Responsible for attracting, developing, and retaining talented employees.
  • Handles recruitment, onboarding, training, performance management, compensation, and benefits.
  • Creates a positive and productive work environment.


  • Manages the MSME’s financial records.
  • Tracks income and expenses, prepares financial statements, and ensures compliance with accounting standards.
  • Provides financial insights and supports decision-making.


  • Focused on managing the financial resources of the MSME.
  • Secures funding manages cash flow, and invests capital.
  • Develops financial forecasts and budgets.

Research & Development:

  • Responsible for developing new products, services, and processes.
  • Conducts market research, identifies emerging trends, and innovates solutions.
  • Drives technological advancements and maintains a competitive edge.

Information Technology:

  • Manages the MSME’s IT infrastructure and systems.
  • Provides technical support, ensures data security, and implements new technologies.
  • Drives digital transformation and improves operational efficiency.

Information Security:

  • Protects the MSME’s data and systems from cyber threats.
  • Implements security policies and procedures, conducts risk assessments, and responds to incidents.
  • Ensures compliance with data privacy regulations.

Legal, Regulatory & Compliance:

  • Ensures the MSME complies with all relevant laws and regulations.
  • Handles legal issues, contracts, and intellectual property matters.
  • Mitigates legal risks and protects the MSME’s interests.

Importance of SBUs:

Each SBU plays a specific role in the overall success of the MSME. The SBUs can create a strong foundation for growth and sustainability by working together effectively. These units must be well-coordinated and aligned with the MSME’s strategic goals.

Additional points:

  • The specific functions and structure of each SBU may vary depending on the size and industry of the MSME.
  • Some MSMEs may outsource some of the SBU functions to specialized service providers.
  • It’s essential for MSMEs to regularly assess the effectiveness of their SBUs and make adjustments as needed.

By investing in these essential SBUs, MSMEs can position themselves for success in a competitive market.

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