Stsadm is not recognized as an internal or external command, operable program or batch file.

Add stsadm.exe to system path environment variable, in other words: Make Windows able to execute stsadm no matter what folder you are in.

This works in pretty much any Windows version (Windows 95, 98, ME, 2000, XP, Server 2003, Vista, Server 2008, Windows 7)

Enter the following in a command prompt:

path “C:\Program Files\Common Files\microsoft shared\Web Server Extensions\12\BIN”;%PATH%

You add the SharePoint BIN folder to the paths system variable, and the ;%PATH% makes sure that you only append this this new folder to the paths variable. You don’t replace it.
So remember the last ;%PATH%

I find this easier than doing it through the GUI in Windows, but you can do it there too.

“Start” > “Control panel” > “System” > “Advanced system setings”

Under system variables click Path (You will need to scroll down a bit). Click “Edit”. At the end of the line add:

;”C:\Program Files\Common Files\microsoft shared\Web Server Extensions\12\BIN”

This will result in the same.

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