CEO of a Small Business: Everything You Need to Know
Discover the role of the CEO of a Small Business: learn what they do, when to hire one, and why they're crucial for growth and decision-making.
JackTurner
Who is the CEO of your small business? Is it you or someone else? If you started the business, are you the CEO or just one of the leaders? How is being a founder different from being a CEO? How do these roles let you guide your business?
These are important questions. Finding answers can teach you a lot about leading and managing. Leading a small business is harder than leading a big company. A CEO has limited resources and needs quick growth. Taking on too many projects can be tough, so delivering quality work is crucial. Being innovative, organized, and focused on customers is essential for a CEO. Let’s explore what it means to be a small business CEO.
What does "small business" mean?
A small business is like a big business in how it's owned. It can be a private corporation, partnership, or run by one person. But, it has fewer workers and makes less money each year. The U.S. Small Business Administration (SBA) has rules for what counts as a small business. For example, a company in manufacturing and mining can't have more than 500 workers. A wholesale trading company can't have more than 100 workers to be called a small business.
Why does a small business require a CEO?
After starting a business and hiring staff to handle daily tasks, many owners hope to relax and let things run smoothly. However, this is when the CEO’s role becomes crucial. Unlike employees who focus narrowly on their tasks, a CEO sees the bigger picture. They ensure that the company’s products and services meet market needs, choose the right markets, make wise business decisions, and delegate tasks effectively. That's why every small business needs a CEO to provide this broad perspective.
When should a small business appoint a CEO?
Many small business owners act as CEOs. However, sometimes it's necessary to hire a CEO, especially when the business faces critical decisions that require strategic thinking. Owners should consider hiring a CEO when they need help with:
- Using past business experience effectively.
- Growing specific parts of the business.
- Scaling the business while also focusing on innovation.
What are the responsibilities of a CEO in a small business?
In a small business, the CEO does many jobs because there aren't many other executives. Here are some things a CEO in a small business does:
- Plan how the business will work
- Get money from different places
- Manage money and hire an accountant when needed
- Hire other companies for marketing and tell them what to do
- Buy things to sell and make sure there are enough things
- Meet new people to find new ideas and ways to grow
- Help customers when they need it
Few interesting CEO facts and statistics
The CEO title is commonly used in business. It stands for 'chief executive officer' and was first used in a Harvard Business Review article in 1960 by Max Danish and William Gorvine. As of 2023, CEOs earn about $189,520 per year on average, according to the U.S. Bureau of Labor Statistics (BLS). At Ohio University, you can study online for an MBA in as little as two years while working or growing your business.
Conclusion
In conclusion, knowing the CEO's role in a small business is very important. Whether you're the founder or thinking about hiring someone for the job, being a CEO means doing many things to make sure the business succeeds. This includes planning, managing money, finding new customers, and making smart decisions. A CEO in a small business has to balance all these tasks with limited resources and a need for fast growth. They guide the business by being smart, organized, and focused on what customers need.
FAQs
Who is the CEO of a small business?
The CEO can be the founder or someone hired to lead the company.
What's the difference between a founder and a CEO?
The founder starts the business; the CEO manages and grows it.
Why does a small business need a CEO?
A CEO oversees the big picture, makes decisions, and manages resources for growth.
When should a small business hire a CEO?
When it needs strategic leadership to grow, use past experience, or innovate.
What does a CEO do in a small business?
Plans, manages money, hires for marketing, ensures enough inventory, explores new ideas, and helps customers.
What are some facts about CEOs?
CEO stands for 'chief executive officer.' They earn about $189,520 per year on average, and you can study for an MBA in as little as two years while working or growing your business at Ohio University.
