LLCs owners have great flexibility in deciding how their entity is managed. Most LLCs are member-managed. With this approach all the members (owners) of the LLC share responsibility for the day-to-day running of the business. This approach is more common in part because most LLCs are small businesses with limited resources and they don’t need a separate management level to operate.
LLCs may also elect to be manager-managed. This means that only designated members, or certain nonmembers/outsiders, or a combination of members and nonmembers, are given the responsibility to run the business. The other members in a manager-managed LLC are passive investors who are not involved in business operations. This form of management may be desirable for large LLCs with many members, or where some members only want to be passive investors in the business.
For more details, see "Member-Managed LLCs Versus Manager-Managed LLCs."