Mary Beth Raven in her blog here shows how to enable "File > Application > Install..." in Lotus Notes. Just you go to "<Lotus Notes folder>\framework\rcp", find a file "plugin_customization.ini" and add a line com.ibm.notes.branding/enable.update.ui=true in the file.
But based the screenshot provided on her blog I guess she didn't ran into a specific problem, which I did, because she was using Windows XP. Basically if you edit the file plugin_customization.ini and try to save it you will get an error saying "Cannot create the C:\Program Files\IBM\Lotus\Notes\framework\rcp\plugin_customization.ini. Make sure that the path name are correct."
Why this message? Here's why. In Windows Vista/7 (don't know about 8) you cannot edit files inside Program Files directory directly. Remember User Account Control! So you have go to "Start > All Programs > Accessories", right-click Notepad, and click "Run as administrator". Now open the file plugin_customization.ini, edit it and save it.