Meaning of ‘Administration’

Apparel Industry Management 3(3+0)

Lesson 1 : Management

Meaning of ‘Administration’

That phase of business activity which relates to the overall determination of the major policies and objectives is technically known as what we call ‘Administration.’ Before starting any business the promoter has to take certain basic decisions. These decision include such matters as the type of enterprise – whether manufacturing, finance, merchandising, mining, transportation, and so on; the particular phase within the type – what article is to be produced in manufacturing, for example, its price range, the method of distribution and the extent of the market in which to compete: geographic location, as well as specific location of the plant; and a multitude of other decisions of which the foregoing are illustrations. These basic decisions once taken are by no means final, because the requirements of a dynamic society must be met by constant adjustments. ‘A-D-M-I-N-I-S-T-R-A-T-I-O-N’ frames the policies and makes the necessary adjustments.

In business firms, administration refers to the higher and policy-determining levels. Administration is concerned with the determination of overall corporate objectives, policies and master strategies. Its origin is found in the bureaucratic structure of Government or from some laws. In government circles, ‘Administration’ is frequently used in the same sense as ‘Management’ is used in private business. In law also, ‘administrators’ are appointed to look after the estate of a deceased person. Government business administrators while administering and managing business affairs are to execute the plans and policies formulated by the Government. Similarly, the estate administrators keep intact the property and manage the estate according to some specific mandates of law.
Let us cite a few definitions of ‘Administration.’

  1. ‘Administration’ is fundamentally the direction of affairs. It is purposive action and, to an increasing degree, it is informed rational and deliberate action… is overwhelmingly concerned with the choice of ends, ways and means for the attainment of desired results. The three main elements of administration are the formulation of goals, the choice of ways and means and the direction of the people in the some group purpose.
  2. ‘Administration is the total of planning, organizing, coordinating, motivating, controlling and operating work.’

Although certain authors consider ‘administration’ as concerned mainly with decision-making and policy-formulation, Allen refers to it as comprising all the functions that a manager of an enterprise is expected to perform in realizing the chosen objectives. In short, ‘Administration’ concentrates on the co-ordination of finance, production and distribution. It determines the corporate organization climate and structure and acts as the central controlling authority in the organization.

Last modified: Tuesday, 15 May 2012, 5:30 AM