Notes

Program Name- MBA

Course Name-Management Fundamentals Sem-I

Unit Number- 1 Unit Name- Introduction and Basics of Management

Topic Name- Difference between Management and Administration

INTRODUCTION

Simply put, management can be understood as the skill of getting the work done from others. It is not
exactly same as administration, which alludes to a process of effectively administering the entire
organization. The most important point that differs management from the administration is that the
former is concerned with directing or guiding the operations of the organization, whereas the latter
stresses on laying down the policies and establishing the objectives of the organization.
Broadly speaking, management takes into account the directing and controlling functions of the
organization, whereas administration is related to planning and organizing function.
With the passage of time, the distinction between these two terms is getting blurred, as management
includes planning, policy formulation, and implementation as well, thus covering the functions of
administration. In this article, you will find all the substantial differences between management and
administration.
The use of two terms management and administration has been a controversial issue in the management
literature. Some writers do not see any difference between the two terms, while others maintain that
administration and management are two different functions. Those who held management and
administration distinct include Oliver Sheldon, Florence and Tead, Spriegel and Lansburg, etc.
According to them, management is a lower-level function and is concerned primarily with the execution
of policies laid down by administration. But some English authors like Brech are of the opinion that
management is a wider term including administration. This controversy is discussed as under in three
heads:

(i) Administration is concerned with the determination of policies and management with the
implementation of policies. Thus, administration is a higher level function.
(ii) Management is a generic term and includes administration.

(iii) There is no distinction between the terms management and administration and they are used
interchangeably.

(i) Administration is a Higher Level Function: Oliver Shelden subscribed to the first
viewpoint. According to him, "Administration is concerned with thedetermination of corporate policy,
the coordination of finance, production and distribution, the settlement of the compass of the
organization and the ultimate control of the executive. Management proper is concerned with the
execution of
policy within the limits set up by administration and the employment of theorganization in the particular
objects before it... Administration determines the organization; management uses it. Administration
defines the goals; management strives towards it".

Administration refers to policy-making whereas management refers to executionof policies laid down
by administration. This view is held by Tead, Spriegel and Walter. Administration is the phase of
business enterprise that concerns itself with the overall determination of institutional objectives and the
policies unnecessary tobe followed in achieving those objectives. Administration is a determinative
function; on the other hand, management is an executive function which is primarily concerned with
carrying out of the broad policies laid down by the administration. Thus, administration involves broad
policy-making andmanagement involves the execution of policies laid down by the administration as
shown in Table 1.

Table 1: Administration Vs. Management

Basis Administration Management
1. Administration is concerned Management means getting the
Meanin with
g
the formulation of objectives, work done through and with
plans others.
and policies of the organization
2. Nature Administration relates to the Management refers to
of decision- execution of
work making. It is a thinking decisions and is a doing
function. function
3. Administration determines Management decides who shall
Decisio what is to
n
Making be done and when it is to be implement the administrative
done
decisions.
4. Status Administration refers to higher Management is relevant at
levels lower levels
of management in the organization.

(ii) Management is a Generic Term: The second viewpoint regards management as a generic
term including administration. According to Brech, "Management is a social process entailing
 responsibility for the effective and economical planning and regulation of the operation of an enterprise
in fulfillment of a given purpose or task. Administration is that part of management which is

concerned with the installation and carrying out of the procedures by which the programme is laid down
and communicated and the progress of activities isregulated and checked against plans". Thus, Brech
conceives administration as a part of management. Kimball and Kimball also subscribe to this view.
According to them administration is a part of management. Administration is concerned with the actual
work of executing or carrying out the objectives.

(iii) Management and Administration are Synonymous: The third viewpoint is that there is
no distinction between the terms 'management' and 'administration'. Usage also provides no distinction
between these terms. The term management is used for higher executive functions like determination of
policies, planning, organizing, directing and controlling in the business circles, while the term
administration is used for the same set of functions in the Government circles. So there is no difference
between these two terms and they are often used interchangeably.

It seems from the above concepts of administration and management that administration is the process
of determination of objectives, laying down plans andpolicies, and ensuring that achievements are in
conformity with the objectives. Management is the process of executing the plans and policies for the
achievementof the objectives determined by an administration. This distinction seems to be toosimplistic
and superficial. If we regard chairmen, managing directors and general managers as performing
administrative functions, it cannot be said that they perform only planning functions of goal
determination, planning and policy formulation, and do not perform other functions such as staffing
functions of selection and promotion, or directing functions of leadership, communication and
motivation. On the other hand, we cannot say that managers who are responsible for the execution of
plans and formulation of plans and policies, etc. do notcontribute to the administrative functions
of goal determination, and formulation of plans and policies. In fact, all manages, whether the chief
executive or the first line supervisor, are in some way or the other involved in the performance of all the
managerial functions. It is, of course, true that those who occupy the higher echelons of organizational
hierarchy are involved to a greater extent in goal determination, plans and policy formulation and
organizing than those who are at the bottom of the ladder.

SUMMARY

• Theoretically, it can be said that both are different terms, but practically, you will find that the terms are
more or less same. You would have noticed that a manager performs both administrative and functional
activities.

• Although the managers who are working on the topmost level are said to be the part of administration
 whereas the managers working on the middle or lower level represents management. So, we can say that
administration is above management.

The major differences between management and administration are given below:

• Management is a systematic way of managing people and things within the organization. The
administration is defined as an act of administering the whole organization by a group of people.
• Management is an activity of business and functional level, whereas Administration is a high-level
activity.
• While management focuses on policy implementation, policy formulation is performed by the
administration.
• Functions of administration include legislation and determination. Conversely, functions of management
are executive and governing.
• Administration takes all the important decisions of the organization while management makes decisions
under the boundaries set by the administration.
• A group of persons, who are employees of the organization is collectively known as management. On
the other hand, administration represents the owners of the organization.
• Management can be seen in the profit-making organization like business enterprises. Conversely, the
Administration is found in government and military offices, clubs, hospitals, religious organizations and
all the non-profit making enterprises.
• Management is all about plans and actions, but the administration is concerned with framing policies
and setting objectives.
• Management plays an executive role in the organization. Unlike administration, whose role is decisive
in nature.
• The manager looks after the management of the organization, whereas administrator is responsible for
the administration of the organization.
• Management focuses on managing people and their work. On the other hand, administration focuses on
making the best possible utilization of the organization’s resources.

1.0 SELF-ASSESSMENT QUESTIONS

1. Define Management. How does it differ from Administration?

2. What are the Key Differences between Management and Administration?
3. What is more superior Management or Administration?
4. Quote TWO examples each for Management and Administration?
5. Distinguish between Management and Administration?