'DBMS' stands for Database Management System, and its primary function is to effectively manage data within a database. It provides tools for creating, retrieving, updating, and deleting data while ensuring data integrity and security. A DBMS allows multiple users to access data concurrently and supports data modeling, which helps in structuring data efficiently according to the application needs. By utilizing a DBMS, businesses can ensure data consistency and reduce redundancy, which enhances the management of large amounts of information across different platforms and applications.