Preheat your oven to 400°F (200°C).
In a large mixing bowl, combine the halved baby potatoes and sliced smoked sausage.
Drizzle the olive oil over the potatoes and sausage, then sprinkle the ranch seasoning, garlic powder, onion powder, salt, and pepper. Toss until everything is evenly coated.
Spread the mixture in a single layer on a large baking sheet.
Bake for 25-30 minutes, or until the potatoes are tender and golden brown, stirring halfway through for even cooking.
Remove from the oven and sprinkle the shredded cheddar cheese on top. Return to the oven for an additional 5 minutes, or until the cheese is melted and bubbly.
Drizzle the sour cream over the top and garnish with chopped parsley if desired. Serve warm.