Management & Administration - Introduction to Management, Contemporary Management | Contemporary Management - B Com PDF Download

Definition of Management

Management is defined as an act of managing people and their work, for achieving a common goal by using the organization’s resources. It creates an environment under which the manager and his subordinates can work together for the attainment of group objective. It is a group of people who use their skills and talent in running the complete system of the organization. It is an activity, a function, a process, a discipline and much more.

Planning, organizing, leading, motivating, controlling, coordination and decision making are the major activities performed by the management. Management brings together 5M’s of the organization, i.e. Men, Material, Machines, Methods, and Money. It is a result oriented activity, which focuses on achieving the desired output.

Fig : Difference Between Management and Administration

Definition of Administration

The administration is a systematic process of administering the management of a business organization, an educational institution like school or college, government office or any nonprofit organization. The main function of administration is the formation of plans, policies, and procedures, setting up of goals and objectives, enforcing rules and regulations, etc.

Administration lays down the fundamental framework of an organization, within which the management of the organization functions.

The nature of administration is bureaucratic. It is a broader term as it involves forecasting, planning, organizing and decision-making functions at the highest level of the enterprise. Administration represents the top layer of the management hierarchy of the organization. These top level authorities are the either owners or business partners who invest their capital in starting the business. They get their returns in the form of profits or as a dividend.

Key Differences Between Management and Administration

The major differences between management and administration are given below:

1. 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.
2. Management is an activity of business and functional level, whereas Administration is a high-level activity.
3. While management focuses on policy implementation, policy formulation is performed by the administration.
4. Functions of administration include legislation and determination. Conversely, functions of management are executive and governing.
5. Administration takes all the important decisions of the organization while management makes decisions under the boundaries set by the administration.
6. 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.
7. 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.
8. Management is all about plans and actions, but the administration is concerned with framing policies and setting objectives.
9. Management plays an executive role in the organization. Unlike administration, whose role is decisive in nature.
10. The manager looks after the management of the organization, whereas administrator is responsible for the administration of the organization.
11. 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.

Comparison Chart

Conclusion

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.