Vanderbilt Law Review

First Page



The small firm, particularly the newly formed one, is confronted with problems ranging from the shortage of capital to the legal intricacies of organizational form. The technical obstacle of raising capital, obtaining sales outlets, and purchasing equipment must be surmounted. In the final analysis, however, the success of a small business depends upon the managerial ability of its owner.' The purpose of this article is to identify a few of the major management problems of the small enterprise and suggest appropriate solutions. One continuous difficulty is the structuring of the organization. At what point should staff specialization occur? What are the most common managerial problems encountered with growth? An other major problem is the development of good leadership patterns and the appropriate use of the power of delegation. How can the chief executive of a small business delegate decision-making powers to his subordinates? What are the common faults in delegation and leadership patterns in small firms?