The present day concept in nursing service administration is to demonstrate administrative functions that will provide therapeutic and satisfying situations for patients and personnel. Administration is the management or guidance of an organization for the most effective accomplishment of its stated goal.The goal of a nursing service organization is more specifically to give continuous care to the patients; to recognize the physical, emotional and social needs of the patients; to meet these needs insofar as possible; to assist in restoring the patients to their optimum health status. In working toward this goal, nursing must maintain itself internally by recognizing the needs of the individuals who make up a nursing service; it must adapt itself to its environment, and working harmoniously with other services of the parent organization(9).Only through democratic administration can therapeutic and satisfying situations be created for both patients and personnel. Such administration recognizes the worth of each individual. When employees have a part in planning and when they feel respected and accepted, they derive more satisfaction from their work and are better able to respect and accept their patients and co-workers.Skillful delegation of administrative duties at all levels in nursing service is important if the professional nurse is to be utilized effectively in improving the quality of nursing care in our psychiatric hospital.This paper has attempted to emphasize the concept of good management principles, in administering nursing services. If we are to accomplish our patient-centered goals, our administration must be people-centered.