The following steps make it easy to run common SharePoint administrative tools such as STSADM and PSCONFIG from a command line without having to navigate to folder that contains these tools.
1. Select Start > Control Panel > System
2. Under the Advanced tab select ‘Environment Variables’
3. Select the ‘Path’ variable, click ‘Edit’ and enter the following text (note the semi-colon):
;C:\Program Files\Common Files\Microsoft Shared\Web Server Extensions\12\BIN
4. Close any open command windows to allow the change to take effect