Whether you have already decided to study a Business degree abroad or are still considering your study options, it’s important to understand the differences between a Business Administration degree and a Business Management degree to make sure you apply to the right type of Master’s studies based on your career goals.
Throughout this article, we try to compare and clarify what Business Administration and Business Management mean, which type of degree might be right for you, and which are the best universities and potential career paths.
What’s the difference between Business Administration and Business Management?
Short answer: It’s complicated. The difference between the subjects of Business Administration and Business Management is not always a simple one, especially when it comes to Business studies. That’s why the distinctions can vary depending on the context. Here are a few ways to look at the differences between the two disciplines:
1. Manage operations vs manage processes
The most common distinction between Business Management and Business Administration has to do with what you are managing in each position. While a business manager is focused on the daily operations within the company, a professional with business administration responsibilities makes sure company processes are running smoothly and the whole company sticks to its goals and priorities. Just like the names of the disciplines suggest: managers manage people, while administrators have administration responsibilities.
An example would be the difference between a manager who runs the business (the business manager) and the managers who run the HR department, or the company’s financial processes. These latter managers are charged with business administration responsibilities.
2. Broad planning vs specializing
Some of the most common responsibilities of business managers are planning initiatives and organizing their teams. They are also focused on making sales, attracting new business and catching and answering market trends.
The flip side is that while business managers have a broad overview of the marketplace, they are not as laser-focused as specialised business professionals. These are the employees charged with business administration duties, who are the undisputed experts in their chosen field.
3. Client facing vs inside the company
Based on the differences we've discussed up until now we could say that business managers are more focused on the interaction between the company and the business world, while business professionals focused on administration are more involved in the inner workings of the company.
In these roles, general business managers are in more contact with actual clients to which they sell the company’s products or services. Business administration specialists ensure that the company is healthy enough to be able to meet its commitments to the clients and that it actually delivers what sales teams promise. These experts usually manage departments such as Marketing, Human Resources, Accounting, Finance, Product Innovation, IT, Supply Chains and more.
4. Managing large or compact teams
Because attracting clients is the number one priority for most companies and because of the broad scope of responsibilities business managers have, they end up leading larger teams. Business professionals who are more specialized usually work in more compact teams with a high level of expertise.
Most top-level business executives have graduated Business Administration degrees such as MBAs so they may also work with fewer people at the top of the company.
5. Where Business Management and Business Administration intermix
The distinction between the two types of disciplines is not always so clear. Even Wikipedia uses the two terms interchangeably. Probably no one in business actually makes a clear distinction between the 2 disciplines. Employers are more focused on the skills each employee has and how to best make use of them.
In academic terms, Business Management may refer to a broad set of disciplines related to Business studies, which also includes Business Administration.
In the case of small companies or start-ups, Business Management graduates and Business Administration graduates take up similar roles with the same responsibilities, as there aren’t so many people to manage and the company does not have a lot of interconnected processes that need organising.
Business Management vs Administration - Which one is for me?
A way to answer this question is to consider if you would rather study an MBA degree or an M.Sc. in Management. Masters in Management require less work experience compared to MBA degrees as part of their application requirements. This means you will be able to start studying the first option easier. However, there is no denying that MBAs have much more weight on the job market, and employers tend to be more impressed by applicants who have graduated a good MBA.
Both types of Business degrees give students a broad understanding of business. So, you will not be automatically disqualified if you target a job role in Business Management and you have an MBA. A good employer will try to figure out if you have the right skills for the job.
If you studied one degree, and maybe you specialized in a certain branch that doesn’t mean you can’t develop in other areas as well. After all, modern business is versatile and requires professionals who can juggle a variety of tasks and responsibilities.
One important thing to keep in mind is that MBA degrees are still some of the most popular academic degrees in the world and for good reason: they give a versatile set of tools and skills which students can use to reach their top career potential.
So, even if a degree has Business Administration in its name - suggesting more specialized roles – they still give you better chances of reaching executive and top management roles in companies. Read more about the differences between MBAs and Masters in Management.
A Master’s in Business Management might be for you if:
- You like leading large teams and are comfortable with a leadership role.
- You like developing a vision and making plans while communicating effectively.
- You like having direct contact with clients.
- Have a feel for business opportunities and like discovering new opportunities.
- You want to develop a broad set of skills you can apply in different settings.
- You are not yet sure which branch of management you want to specialize in.
An MBA degree might be for you if:
- You want a highly specialised business education.
- You have an analytical, data-driven mind.
- You aim at reaching the highest professional levels.
- You love optimizing and building processes that last.
- You will also need to develop your communication and management skills, but maybe not for large teams.
- You like bridging gaps between different groups and different visions towards common goals – communication between departments.
- You are technically inclined and are comfortable operating with a variety of tech tools.
Best universities to study Business Administration or Business Management
Best Global MBAs - Financial Times Rankings 2020
- Harvard University, US
- University of Pennsylvania: Wharton, US
- Stanford University, US
- INSEAD, France / Singapore
- CEIBS, China
- MIT: Sloan, US
- London Business School, UK
- Columbia Business School, US
- HEC Paris, France
- University of Chicago: Booth, US
See the full list here.
Best Masters in Management - Financial Times Rankings 2019
- University of St. Gallen (HSG), Switzerland
- HEC Paris, France
- London Business School, UK
- ESSEC Business School, France/Singapore/Morocco
- ESCP Business School, France/UK/Germany/Spain/Italy
- Rotterdam School of Management, Erasmus University, the Netherlands
- University College Dublin: Smurfit, Ireland
- CEMS Global Alliance, France
- WU (Vienna University of Economics and Business), Austria
- Università Bocconi/SDA Bocconi, Italy
See the full list here.
Check out more business school rankings in these articles:
- Best Business Schools in the World
- Best Business Schools in Europe
- Best Business Schools in the US
- Best Business Schools in Australia
- Best Online MBA Degrees
Classes and specializations
No matter if you choose to study an MBA or a M.Sc. in Management, you’ll attend classes covering general management topics like: Marketing, Accounting, Finance, Business Ethics and General Management. These aim at giving you a basic understanding of how businesses work, and how to manage money, company products and processes.
In short, you will learn how products and services are developed and planned and the different stages they go through in a company until they are delivered to clients. Later on, you should expect more specialized courses, especially for Business Administration classes.
MBA or BBA students generally choose a specialization from these main topics:
- Human Resource Management
- Supply Chain Management
- International Business
- Healthcare Management
Here are some classes you could expect to study during a Business Management degree:
- Organizational Behaviour
- Business Communication
- Business Strategies
- International Business
- HR Management
- Business Ethics
And here are some classes offered by Business Administration degrees:
- Operations Management
- Data Analysis for Decision Making
- Applied Business Statistics
- Business Finance
- Business Leadership
- Communication Strategy
- Marketing Management
- Product Branding and Development
- Investment Management
Careers and average salaries
So, what careers should graduates in Business Management and Business Administration expect, and what are the differences?
First of all, if you graduate a Business Management degree that doesn’t mean that Business Administration responsibilities are off the table, and vice versa. Both types of degrees are versatile enough and offer diverse development tracks giving you the tools to work in a variety of professional roles and balance diverse responsibilities.
If you graduated a Business Administration degree that doesn’t mean you can’t get into a management position. In fact, in small companies Business Management and Business Administration roles are interchangeable.
For large organisations, the differences become more significant, with business administrator positions ensuring a specific branch or process in the company runs smoothly. On the other hand, business managers take up high-level responsibilities, like the company’s strategy, new business, distribution channels, mergers and more. Business managers are also the ones setting the company goals, while Business Administrators would handle the specifics of implementing the overall vision.
Here are the main careers for the two types of disciplines and their average yearly salaries in the USA:
Business Administration careers
- Business analyst - 60,444 USD/year
- Financial officer - 61,331 USD/year
- Human Resources manager - 67,252 USD/year
- Auditor - 56,722 USD/year
It’s good to mention that because of the popularity of MBA degrees, these are usually linked to higher job positions and executive roles within companies. Executive business administration roles include:
- Chief financial officers - 133,951 USD/year
- Chief information officers - 161,274 USD/year
- Chief operating officers - 142,735 USD/year
- General managers - 97,460 USD/year
Business Management careers
- Sales manager - 61,100 USD/year
- Operations manager - 65,185 USD/year
- Marketing manager - 65,267 USD/year
- Financial manager - 91,433 USD/year
- Account manager - 54,275 USD/year
- Business development manager - 72,777 USD/year
- Project manager - 74,100 USD/year
You should also keep in mind that the careers for the 2 types of degrees look very similar for fresh graduates in entry-level positions. As you progress on your career ladder and start specializing, the differences will become more apparent.
Business Administration or Business Management - Which one is better?
At the end of the day, the answer is all up to you. If you already know what direction you are going for, just pick one of the two that fits your plans. If you haven’t yet decided, both offer tools to help you develop and succeed in your career. An MBA is likely more expensive, but if you can afford it, it will probably offer you a leg up to higher management positions.
But that doesn’t mean a Master’s in Management won’t be just as useful, especially if you are dedicated to learn and be the best you can be. Regardless of your choice, today’s business world needs dedicated business professionals with a diversified skill set.