Building Business Solutions: Business Analysis with Business Rules (2nd Edition) … Just Out! http://www.brsolutions.com/b_building_business_solutions.php
Get it on Amazon: http://goo.gl/HXxN1fWhat It’s About: How to develop business solutions working directly with business leads, create blueprints of the solutions, and then use those blueprints for developing system requirements. Engineering business solutions, not just requirements.We have applied the techniques described in this book successfully in hundreds of companies worldwide.
Kind Words from a Practitioner: “We have based our whole business rules analysis practice on the methodology and techniques developed by the Business Rules Solution team. This book is an integral part of our practice. It’s an easy to read, useful guide with real life examples – we use it daily and couldn’t do without it!” – Michelle Murray, Inland Revenue Department NZ
New in this Edition: How Business Architecture corresponds with your projects and requirements work. Developing a Concept Model and how it will help you. How business rules align with the new terminology in the recently released IIBA® BABOK® Guide version 3.
Analyzing and modeling operational business decisions has become a new industry focal point in the past few years. Business-and-rule-friendly techniques have emerged, and just this year an OMG standard. These resources address such important questions about operational business decisions as:
How are they structured?
How can they be decomposed?
How can you capture related business rules?
Decision engineering also provides an opportunity for a fresh look at decision tables.
Just to be clear, decision tables themselves are not new. They’ve actually been around longer than software engineering, at least back to the 1960s. What’s emerging today is a fresh way of looking at decision tables from a business rather than a software perspective, and important new ideas about how they can help address complexity.
Your ability to respond in appropriate ways to pinpoint circumstances where business rules are breached – automatically and independently of processes – provides the mechanism you need to support very smart, very friendly business systems. Normally we think about breaches occurring for behavioral rules, where a breach means a violation has occurred. Can breaches occur for decision rules too? The answer is yes and no. Read on!
A breach occurs for a business rule when the business rule isn’t satisfied upon being applied to some set of circumstances (state of affairs). Normally we think about breaches occurring for behavioral rules, where a breach means a violation has occurred (e.g., you violated the posted speed limit).
The potential for violations of behavioral rules raises several important questions that business analysts should answer in advance of deployment for each behavioral rule:
1. What level of enforcement should be applied.
2. What special response to a violation is appropriate, if any.
3. What special message, if any, should be returned to some worker(s) upon a violation.
Unlike behavioral rules, no definitional rule can ever be violated. Literally, things must be correct under such rules by definition.
Let’s take an example. Suppose somebody asserts “2+2=5”. According to the rules of mathematics, we know the correct answer is 4. The answer “5” is deemed irrevocably wrong. But is the asserted answer ever allowed to stand?
If the rule is defined as a decision rule, the asserted answer is never allowed to stand. More precisely, the assertion would never be recognized to have happened in the first place. If someone asserts “2+2” the answer “4” is concluded immediately. Period. No breach, no opportunity for error.
If defined as a behavioral rule (one that is not strictly enforced), the asserted answer is allowed to stand, but a violation is recognized. How might that capability be useful? Suppose the error were made by a student in grade school. It might be quite useful for the student and/or a tutor to know about it immediately and automatically. Specifying an appropriate violation response can make such notification happen.
In business, of course, definitional rules can be far more complex. Nonetheless, your ability to respond in appropriate ways to the pinpoint circumstances where certain rule-related events occur – automatically and independently of processes – provides exactly the mechanism you need to support very smart, very friendly operational business decision systems.
Decision Rules and Breaches
Decision rules are a special kind of definitional rule involving implications (e.g., A implies B). They support inferences and determinations – identifying an appropriate outcome from among a set of alternatives.
Like all decision rules, definitional rules cannot be violated. They are simply deemed true by definition.
Purely from a business perspective, however, some assertions of fact(s) may make it appear that a breach-like event has occurred. I take pains to emphasize any such perception is purely from the business perspective, not from the perspective of logic. You perceive a breach of a decision rule simply because it’s useful to do so, not because any true violation has occurred.
In evaluating some particular case (situation, set of circumstances, or matter of concern), for example, things might not follow the ‘happy path’. Think of a breach of a decision rule as a bump in the road – a gap along the happy path.
Let’s return to the three questions listed earlier. Although the first question about enforcement level obviously doesn’t apply to decision rules, adjusted versions of questions 2 and 3 remain in play.
Consider the following simple business example. Suppose a bank has this decision rule:
A credit application must be considered discrepancy-free with respect to a credit report for the applicant if all the following are the same:
date of birth
Social Security Number
Let’s suppose that an applicant uses just the initial for her middle name on her credit application. If the credit report shows her full middle name, then the names are not the same and the credit application will not be considered discrepancy-free.
Note carefully the rule hasn’t been violated; it did its ‘work’ correctly and it did reach the proper conclusion (not discrepancy-free). But a gap – a breach – for her case has been identified from a business perspective because the rule failed on one of the conditions. We should be able to take advantage of that breach to take appropriate action – selectively, automatically and in real time.
For example, the desired response to the breach might be to insert the following to-do item in the work queue of the responsible staff member: “Review discrepancy and manually ok if appropriate”. (The to-do item should naturally also provide ready access to the related documents.) The breach of the rule causes this action to occur automatically.
Think about how many decision rules might exist for determining credit-worthiness, and how many selective conditions they might have. Could you build a responsive system by incorporating the selective responses needed into the related process model(s)? Not a chance – that approach won’t scale. Instead, the selective responses need to be specified based on the business-rule side of things.
Kinds of Breach Specifications for Decision Rules
Breach specifications for a decision rule can be of the following two kinds.Breach Response. A breach response can be an action of virtually any kind. For example, a breach action might be to:
Add some task(s) to a (non-redundant) to-do list in some appropriate work queue.
Add some documentation items to a (non-redundant) not-yet-received list.
By these means very selective follow-up processing/handling (“what to do next”) can be organized pertaining to any specific issue (breach) for a given case. Such selectivity is made possible by the granularity of the rules.
Breach Message. A specially-worded breach message can be forwarded to any involved party either inside or outside the company. A breach message generally explains one or both of the following at any level of detail desired:
Why the rule or condition failed. (The rule or condition statement already indicates very precisely what the issue is, but the breach message can explain in a more friendly manner.)
What should be done to address the issue.
More Complex Example
Breach specifications apply selectively and specifically to a decision rule and/or any of its conditions. A breach specification applies if and only if that decision rule and/or condition fails (is not true) in evaluating some specific case (e.g., a specific credit application). An example of a decision rule with condition-specific breach specifications is illustrated in Table 1.
Table 1. Example of More Complex Decision Rule with Condition-Specific Breach Specifications
A fluctuating income must be considered eligible if all the following are true:
Conditions of the
the applicant has a 3-year proven track record of consistent income
the applicant is likely to have comparable income in the future
Add to-do item for that credit application: “Contact employer to verify applicant has reasonable opportunity for future income.”
the income is validated
Add required documentation items not yet received to a pending list for the credit application.
To applicant: “[date] Here’s a list of documentation items related to your income we have not yet received. [pending list].”
Using Breach Specifications
Breach specifications can be:
General for an entire decision rule including all its conditions. (The example in Table 1 doesn’t include any whole-rule specifications. If the rule did they would appear in the first row.)
Specific to a given condition.
Specific to collections of conditions (none shown for the example).
A breach is detected only if the conclusion of the rule as a whole, or some particular condition within it, evaluates to not true. Things being true should be viewed as moving the case along the desired path (i.e., no breach has occurred). Decision rules (and breach specifications) should be expressed carefully so as to preserve this positive orientation.
Generally, breach actions should be specified only if something can be done to overcome a failure (of a rule or condition). The goal is to move things forward in the case. In the example above, for instance, if nothing whatsoever can be done to correct an issue, the credit application should simply be declined. A behavioral rule to that effect should be specified.
In hierarchies of decisions (e.g., as in Q-Charts) and decision rules (e.g., as based on series of logical dependencies), breach specifications should generally be made only at the lowest level of rule reduction/decomposition. A rule at a higher level in a logical hierarchy only evaluates to not true if some rule(s) below it evaluate to not true. Define breach specifications at the lowest level of granularity.
Although rules can be specified in violation specifications for behavioral rules (e.g., to express some sanction or penalty), they should never be specified within breach specifications for a decision rule. Such ‘nesting’ of rules, especially on the basis of ‘not true’, is inappropriate.
Otherwise the advantages of overall declarative specification can be forfeited.
By default, breach specifications for a decision rule apply only the first time it is evaluated for each case. The assumption is that all business rules, including decision rules, are evaluated on a continuous basis. Re-application of any breach specification for a case therefore requires additional timing and iteration criteria. Whether a case is evaluated iteratively on the same set of decision rules based on timing criteria applied by or for some external process or platform is outside the scope of this discussion. No matter what the scheme of evaluation, the expression of the decision rules – as for all business rules – should be completely unaware of it.
There are two fundamental kinds of business rules: behavioral rules and decision rules. Behavioral rules are rules people can violate; decision rules are rules that shape knowledge or information. Decision rules cannot be violated – knowledge or information just is what it is defined to be. Common to all business rules, no matter which category, is that you want them directly traceable for compliance and other purposes.
How do behavioral rules and decision rules apply differentially to service workers vs. white-collar workers vs. gold-collar workers?
Service workers are primarily subject to obeying behavioral rules, or are charged with applying them. Examples:
A counter attendant must not accept a credit card for a purchase under $10.
A flight attendant must ensure passengers have buckled their seat belts for each take-off and landing.
Service workers are subject to operational business decisions made by white-collar workers, but do not play a significant role in making such decisions themselves.White-collar workers are typically involved in business processes where operational business decisions are made. Examples:
Should this loan applicant be given a mortgage?
What flight crew should be assigned to this flight?
White-collar workers generally do not define decision rules themselves – that’s typically work for gold-collar workers. Where such rules are incomplete, unspecified or contradictory, however, white-collar workers generally rely on personal heuristics and experience to make decisions. This approach puts the main goals for white-collar work – consistency and traceability – at jeopardy.White-collar workers, like all workers, are subject to behavioral rules. Examples:
A loan officer must not handle a loan application placed by a family member
The website description for a new product must be approved by two senior managers.
Gold-collar workers (for explanation see http://www.brsolutions.com/2014/08/11/is-%e2%80%9cknowledge-worker%e2%80%9d-the-best-term-for-decision-engineering/) are responsible for non-routine, knowledge-intensive work. The primary goals for such work is that it be insightful (e.g., as in the case of medical diagnosis that fits the available data better) or creative (e.g., as in the case of a new marketing strategy). This type of work is generally beyond the scope of decision rules.
Although gold-collar workers often conduct their work in relatively independent fashion, the work is generally subject to “very close normative control from organizations they work for” [Wikipedia]. Think medical malpractice or following generally accepted principles of accounting. These normative controls, since they can be violated, are sets of behavioral rules.www.BRSolutions.com
Based on the OMG standard SBVR (Semantics of Business Vocabulary and Business Rules). For more on SBVR see the SBVR Insider section on www.BRCommunity.com.
Pink-collar worker is a term sometimes used (in the U.S. at least) to refer to a job in the service industry. Many people find the term off-putting because it traditionally referred to jobs relegated to women. I avoid the term for several other reasons. The category includes:
Such roles as buyers, loan interviewers, dieticians, administrative assistants, etc., whose work at the high-end should be considered white-collar.
Many workers providing personal services on an individual basis, rather than business services in the usual sense. Examples include midwives; hairdressers and barbers; baby sitters and nannies; personal shoppers and fashion stylists; etc.
Clearly many businesses do have extensive staff that is neither white-collar nor gold-collar working to deliver services. Examples include retail workers, sales staff, flight attendants, hotel housekeepers, counter attendants, receptionists, etc. I just call them service workers since they don’t have any traditional uniform color – white, blue or otherwise.Are service workers subject to business rules? Absolutely. Generally these rules are behavioral rules rather than decision rules, however, since their jobs do not focus on operational business decisions. More about that in my next post.www.BRSolutions.com
Some people argue that a knowledge worker is someone who gets paid to improvise or innovate, a factor distinct from the amount of training the worker receives. By this criterion even blue-collar workers can be considered knowledge workers if they constantly improvise or innovate. I don’t find the notion helpful. In my mind, a blue-collar worker who is constantly improvising or innovating, for example, has become an engineer – which is gold-collar, not blue-collar. (For explanation of gold-collar work, see http://www.brsolutions.com/2014/08/11/is-%e2%80%9cknowledge-worker%e2%80%9d-the-best-term-for-decision-engineering/)With respect to white-collar work, what I see in many organizations is white-collar entropy, all resulting from continuous and counterproductive ‘improvising’. A vacuum of coordination filled with too much information simply does not translate into a more productive organization. The more likely result is inconsistency, the enemy of good customer experience.The improvise-and-innovate argument also holds that knowledge workers don’t just apply rules – they invent rules. Hang on a minute. To take a real-life example, do we really want police officers (officers on the beat) inventing rules?! I think not. Their job is to apply rules (laws), not invent them. Otherwise we’d be living in a police state. In a well-run organization, just as in society, above all you want consistency at the operational level. If I call my bank ten different times, I should get the same answer ten different times. If I apply for a mortgage from the same bank at ten different branches, I should get the same result ten different times.
In my experience, that’s hardly the norm. Why? If staff works in an environment where many of the rules are tacit, contradictory, ambiguous, poorly implemented, inaccessible, and/or unintelligible, of course the staff will improvise.
Contrary to what some believe, well-defined rules do not lessen creativity (space to improvise and innovate about how to get desired results). That’s not the way it works. Absence of rules is literally anarchy – and only the bad guys look clever in that context.www.BRSolutions.com
In my most recent post, I distinguished between white-collar and gold-collar workers. See http://www.brsolutions.com/2014/08/11/is-%e2%80%9cknowledge-worker%e2%80%9d-the-best-term-for-decision-engineering/Can you differentiate between white-collar work and gold-collar work by whether it can be automated? In a day and age when IBM Watson can win at Jeopardy, I think it’s probably foolish to try.But I don’t think that’s the right question. Instead, I would ask whether the problem spaces are sufficiently distinct that they require different approaches. The answer to that question is definitely yes. That’s one reason I think it’s important not to say simply “knowledge worker” in process models. Companies pay gold-collar workers for their professional insight, creativity, and ability to digest huge amounts of knowledge on a continuous basis. Novel, unexpected results that fit the data better are at a premium. That’s not what companies pay white-collar workers for – or at least it shouldn’t be. Instead, they should pay white-collar workers to produce consistent results on decisions reached through directly traceable logic – that is, business rules. Unexpected results represent a failure – of an individual worker, a training regimen, or the rules themselves.More often than not, I think the problem actually lies with the rules. In many companies, we ask humans to make operational business decisions in a fog of byzantine rules – rules often far more complex than reasonable (or profitable). In addition, the ‘real’ rules are frequently more tacit or inaccessible than anyone cares to admit. In my view we simply have never been serious about defining, organizing and managing the rules in white-collar decision-making in a reasonable, scalable manner. And we certainly haven’t yet harnessed the power of computers to help with the business-side problem of rule management.www.BRSolutions.com
In a day and age where the automation of operational business decisions is increasingly the goal, I maintain that knowledge worker is the wrong term for business process modeling. The term is simply too broad. Instead I use the terms white-collar worker and gold-collar worker. What’s the key differentiation?
Gold-collar workers. The work of gold-collar workers involves non-routine problem solving, which requires a “a combination of convergent, divergent, and creative thinking” [Wikipedia].
White-collar workers. The work of white-collar workers involves fairly repetitious sets of tasks, which at least in theory should produce relatively consistent results. Also, white-collar workers generally receive much less training than gold-collar workers.
Although the boundary between the two categories is somewhat fuzzy, I believe they generally can be distinguished. Relevant questions include:
How routine is the work?
How consistent should results of the work be?
How much training is required?
As an example, consider loan officers in a bank handling applications for mortgages. White-collar or gold collar?
Routineness. I’d call their work relatively routine.Even though each loan application is different and might involve special cases or exceptions, the work is always about mortgages.
Consistency. You’d like to think different loan officers could produce consistent results on similar kinds of loan applications. Although certainly true in theory, it’s often not the case in practice. More about that momentarily.
Training. Although loan officers do receive significant training and mentoring, it’s not on the order of years as for gold-collar workers.
Based on this analysis I believe loan officers fall into the white-collar category. What about consistency of results? I’ve seen studies comparing results across peers with roughly the same training and experience. The numbers are significantly lower than you might expect. That’s not at all a good thing for either customer experience or the well-being of their organizations. So why not automate the white-collar decision-making work?! Automating white-collar decision-making work well is exactly the focus of business rules and decision engineering. From experience, I’m certain that at least 50% to 80% (maybe more) of the decision work for mortgage applications can be automated, especially if a company is willing to standardize and simplify the adjudication rules some. Huge benefits can be achieved in terms of consistent customer experience, higher productivity, and directly provable compliance. P.S. Mortgage applications are not automated well if rules simply refer applications to humans when the rules cannot handle them.www.BRSolutions.com
In BRS Question Charts (Q-ChartsTM) we refer to an operational business decision by the question it answers (a very nifty idea we pioneered). Does that mean a decision is a question? Shouldn’t decision refer either to the answering of a question or to the answer itself?
To be clear, we definitely do not think or say that the question is the same as the decision.
However, if decision is understood properly in a business rules sense (the trick), there is only one question a decision answers. So as a (very) convenient shorthand, you can use the question as the name of the decision.
With that issue aside, so which should decision refer to, the answering of a question or the answer itself? The dictionary will support you either way you go. From MWUD:
1a: the act of deciding
1b: a determination arrived at after consideration : SETTLEMENT, CONCLUSION
If you’re a process person, you’d probably pick the first definition. But if you’re a true business rules person, you have to pick the second. From a business rules perspective, a decision is the answer (conclusion) you produce, not the act of producing it. The “act of” is something else altogether.
So a decision is an answer. But is answer alone enough? No. Digging a little deeper into MWUD we find these definitions:
determination : the resolving of a question by argument or reasoning
decide [c] to infer or conclude from available indications and evidence
Here’s the point. For business rules it’s crucial to capture the logic path (reasoning, inferences) that gets you to the answer.
To say that differently, for business rules just knowing the conclusion isn’t very useful; the determination must be directly traceable (from conditions or cases to conclusions or outcomes, and vice versa). So focusing on answer in isolation for decision doesn’t quite get you where you want to be. The bigger picture is that the answers are traceable.
P.S. That’s me in the picture, standing at the Cape of Good Hope, pointing toward Antarctica.
 I mean the meaning of the question, not the way it happens to be expressed. There are many ways, even in the same language, to express the same meaning.
My Answer: Look at it this way. If you have no explicit business rules enabling people to do something correctly and consistently, you’ll have no rules for a machine to do it right. Except for speed and memory, machines are no smarter than people. The test of high-quality business rules is whether people could do it right.It’s shocking to me how many people think they can just use a BRMS or decision management platform to address a problem without having to express the rules clearly to other people first. I guess that silver bullet syndrome will always be with us. In any case, making tacit know-how explicit as business rules is first a business and communication problem, then and only then a platform problem.
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Jeanine Bradley – Railinc
“Instructors were very knowledgeable and could clearly explain concepts and convey importance of strategy and architecture.
It was a more comprehensive, holistic approach to the subject than other training. Emphasis on understanding the business prior to technology considerations was reassuring to business stakeholders.”
Bernard – Government of Canada
“I found the course interesting and will be helpful.
I like the pragmatic reality you discuss, while a rule tool would be great, recognizing many people will use Word/Excel to capture them helps. We can’t jump from crazy to perfect in one leap!
Use of the polls is also great. Helps see how everyone else is doing (we are not alone), and helps us think about our current state.”
Trevor – Investors Group
“Sessions flow together well and build upon the concepts for the series which makes the learning easy and better retention.
The instructor is knowledgeable and very attentive to the audience given the range of attendees skill and knowledge of the subject at hand. I enjoy her training sessions.”
Deborah – American Family Insurance
“A great class that explains the importance of business rules in today’s work place.”
Christopher – McKesson
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