Enabling Operational Excellence
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Enabling Operational Excellence
Enabling Operational Excellence

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Posts Tagged ‘knowledge retention’

Reverse-Engineering Business Rules: The Harsh Reality

Welcome-to-Reality-810x608[1]Mining business rules from legacy code raises big challenges. They’re often implemented in arcane, highly procedural languages. The person or team who wrote the code is often long gone (or perhaps in India). Bringing them back into a form that business people and business analysts can understand is hard.

To illustrate, here is an as-coded example from a major bank:

For Primary Borrower or any Guarantor, IF [Processing Date – Credit Bureau File Since Date] is < 12 months AND the total # of Type Code of ‘R’ and ‘O’ trade lines is 3 or less AND the total # of ‘I’ and ‘M’ trade lines is zero AND the Industry Code = OC, ON, OZ, DC, DV, DM, DZ, Then result is Refer.

Obviously most business workers are not going to understand that specification or be able to validate what it says. Actually, this example is well above average in readability – most coding languages are even farther removed from daily business parlance. If you want to have real conversations with business partners, core business knowledge needs to be expressed in structured natural language (e.g., in RuleSpeak®), making careful use of common business vocabulary.

The example above is interesting for another reason. Note the outcome of the specification, the portion after the then, is “Refer”, meaning that the matter in question cannot be resolved. This specification actually does nothing but kick work back out to a human!

A specification that simply escalates a case to a human is not a true business rule at all. Rather, it’s an acknowledgement the actual business rule(s) still haven’t been captured and encoded. That knowledge lingers in somebody’s head (hopefully!).

Our broad experience in reverse-engineering business rules has exposed us to harsh reality: No silver bullets. Once business rules have been encoded procedurally, semantics are lost that cannot be resurrected automatically. You’ve made a bargain with the devil.

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Read more: http://www.brcommunity.com/articles.php?id=b904

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The Story of Al’s Spreadsheet and Absent Brains

I want to share with you the most intelligent thing I’ve ever heard a manager say on the fly. I’ll give some background first. In one way or another, the situation that evoked what she said may seem quite familiar to you. A few years ago Gladys and I were invited to conduct a one-week facilitated session for a national taxation authority. The objective was to reverse-engineer business rules from a very complex spreadsheet. The manager told us everyone was deathly afraid to touch it because no one understood how it worked. You could never tell what impact making a change would have. Used by many of their systems and embedded in various websites, the spreadsheet was mission-critical. She was finally biting the bullet and assembling some of her best staff to re-engineer it. Everyone knew the spreadsheet by its nickname, Al’s Spreadsheet. It dated to the 1970s when it was implemented under the first generation of automated spreadsheets. Notorious in the organization for more than a generation, it was devilishly convoluted. One of these days I might hold a contest for the world’s most complex spreadsheet. I’ve actually told this story many times around the world, and the audiences’ reaction is inevitably the same – perhaps the same as yours reading this. “No, Al’s Spreadsheet couldn’t possibly be the world’s most complex spreadsheet because my company has the world’s worst!” Around the globe there is extensive core operational business knowledge running businesses day-to-day that is highly inaccessible. Just putting your fingers on it, much less revising it, consumes vast amounts of vital resources. We live in a service provider’s dreamscape. It makes you wonder how brittle (read not agile) many companies’ operations really are today. To return to the story, by mid-week we’d achieved only limited success in deciphering the spreadsheet. Progress was painfully slow. Lapsing momentarily into frustration, an idea popped into my head.  I blurted out, “Hey, why don’t we just go ask Al what this thing really does?!” I assure you my intention was not to provide comic relief. To my chagrin that’s exactly what happened. The whole room erupted into laughter. When the hysteria finally subsided, someone patiently explained to me (barely keeping a straight face) that nobody actually knew who Al was – or indeed, whether Al had actually ever even existed. If so he had long since parted ways with the organization, fading away as all workers sooner or later do into the mists of time. That’s when the manager said the thing that I found so memorable. Looking at no one in particular and staring vaguely into the far distance she said, “No organization should ever depend on absent brains.”. Exactly! To ensure the continuity of operational business knowledge, no organization should ever depend on absent brains – or even on brains that could (and eventually always will) become absent in the future. To say it differently, your operational business knowledge should be encoded explicitly in a form that workers you have never even met yet can understand. Operational business knowledge can be either tacit or explicit (read ‘accessible’). The classic test for when knowledge is tacit is ‘lose the person, lose the knowledge’. You make operational business knowledge explicit by expressing it as business rules. So make sure when you lose your Al, he doesn’t walk out the door with the day-to-day knowledge you need to run your business. Encode it as business rules!

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Governance, Compliance and Business Rules (Through Young Eyes)

When my older son graduated from college, he worked as an intern for a professional sports team.  At the end of his very first day of work he called me, puzzled.  “I asked them what my responsibilities were,” he related, “and they said, ‘We need you to know what we are supposed to be doing’.”  After a long pause he went on, “I wanted to ask them why they didn’t already know what they were supposed to be doing, but I didn’t think that would be such a great idea my very first day there.” Let’s see whether at some level that situation sounds familiar to you.  It turns out his area of responsibility had to do with ensuring operational compliance with corporate sponsorship agreements.  The sponsorships are quite expensive.  You might think these agreements would be relatively simple, but of course, there’s no such thing as a truly simple business.  A sponsorship contract:
  • Outlines a complex configuration of promotional and other benefits, some automatable and some not, all usually tailored specifically for the individual sponsor.
  • Is loaded with obligations, decision criteria, and computation formula (read ‘business rules’) to govern the sponsorship relationship.
  • Is amended frequently, both formally and informally (via hand-shake), owing to the dynamic nature of the sponsors’ marketing needs.
To continue the story of my son’s first day, they gave him a stack of contracts and amendments, operational schedules, and invoices and told him to see if they all matched.  Of course they didn’t.  Not by a mile. By the end of the first week, my son had become fairly fluent in the organization’s governance problems.  (Ah, young minds!)  The contracts and schedules were all produced by different people at different times.  Some of the schedules were hand-done and some automated.  But even the ones that were automated often didn’t match the contracts.  The invoices were automated, but in many cases they too bore little resemblance to the contracts.  The IT people were not much help either.  “They seem to speak a different language,” my son reported naively.  Bottom line:  A number of the sponsors were becoming quite annoyed — not a good thing for a mediocre team in a mid-sized market. But there was still more.  The sales reps were, shall we say, quite creative in what they offered the sponsors.  Their terminology, which often found its way into the contracts, was highly idiosyncratic.  Yet they were talking about the same shared resources (e.g., banner boards in the stadium) that had to be coordinated real-time across many sponsors.  They seemed oblivious to some of the company’s rules — even though some, quite literally, were dictated by physics (e.g., a banner board can only say one thing at a time; there is only so much time during a game, etc.). By the way, my son went to one of the team’s games his first week at work.  The team lost.  Attendance was poor.  Sponsors were unhappy.  “I think it’s going to be a season,” he said. After a moment of reflection he added, “You know what really worries me is that I am going to figure all this out, then walk right out the door with all that knowledge.  They’ll be right back where they started.  Doesn’t seem to me like a very good way to run a business.” Welcome, my son, to the reality of business rule mismanagement in the 21st century!

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Six Succinct Reasons for Business Rules

What business problems do business rules address?  My take: 1. Ad hoc rules: Most businesses have no organized approach for specifying their business rules. As a result, business workers often make up the rules as they go along. This leads to confusion, contradiction, and operational inefficiency. After-the-fact resolution of these problems wastes time and resources and causes frustration for customers and staff alike.

Business rule solution: Business rules ensure consistency in customer experience and provably on-target results for demonstrating compliance.

2. Miscommunication: Misunderstanding of key business concepts inevitably results in miscommunication. Does preferred customer discount mean the same across all departments? If not, what are the differences? What rules apply? Do these rules differ for different areas of the business? Are the rules consistent?

Business rule solution: A structured business vocabulary provides a foundation on which rules can be directly based.

3. Inaccessible rules: Finding out what rules apply to a given business situation often involves an open-ended search through multiple sources. It is not uncommon in the end to resort to the application source code. Pursuing rules in this fashion is time-consuming, inefficient, and inaccurate.

Business rule solution: An organized approach for managing business rules yields order-of-magnitude improvements in productivity and business agility.

4. Massive differentiation: Many businesses seek to support highly individualized relationships with growing numbers of customers and other partners across multiple jurisdictions for ever more complex products or services. How can businesses massively differentiate and, at the very same time, conduct each business transaction faster, more accurately, and at ever lower costs?

Business rule solution: Business rules support highly scalable customization and personalization and provide a structural solution for managing complexity.

5. The need to keep up to speed: Rapid change, at an ever faster pace, is a fact of life. In the digital age, people expect almost instantaneous implementation of changes. How can line workers consumed with day-to-day activities ever hope to keep up?

Business rule solution: Real-time delivery of business rules to knowledge workers creates a seamless, never-ending, self-training environment.

6. Knowledge walking out the door: By and large, baby boomers created much of the basic operational business capacity and operational systems we see in place in larger organizations today. Much of the related knowledge still sits in their heads – and nowhere else. Now they are retiring. On a smaller scale, people with vital operational knowledge walk out the door almost every day.

Business rule solution: A systematic way of capturing, documenting and managing business rules enables pragmatic knowledge retention.

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Benefits: What Problems Does the Business Rule Approach Address?

Read to the end for an interesting note about this post. 1. Ad hoc rules: Most businesses have no logical approach for defining their business rules. As a result, business workers often make up the rules as they go along. This leads to confusion, contradiction, and operational inefficiency. After-the-fact resolution of these problems wastes time and resources and causes frustration for customers and staff alike. The larger the organization, the bigger the problem. Also, since many business rules involve monetary transactions (for example, whether a customer should be given a discount, and if so, how much), this problem can also directly affect the bottom line.

Business rule solution: A structured approach helps you think through rules before the fact.

2. Miscommunication: Misunderstanding of key business concepts inevitably results in miscommunication. Does preferred customer discount mean the same across all departments? If not, what are the differences? What rules apply? Do these rules differ for different areas of the business? Are the rules consistent?

Business rule solution: A clear set of concepts provides a foundation on which rules can be directly based.

3. Inaccessible rules: Finding out what rules apply to a given business situation often involves an open-ended search through multiple sources. It is not uncommon in the end to resort to the application source code. Pursuing rules in this fashion is time-consuming, inefficient, and inaccurate.

Business rule solution: A way to manage business rules provides direct accessibility.

4. Massive differentiation: Many businesses seek to support highly individualized relationships with growing numbers of customers and other partners for ever more complex products or services. How can businesses massively differentiate between business parties and, at the very same time, conduct each business transaction faster, more accurately, and at ever lower costs?

Business rule solution: A rule-based approach featuring rapid development and deployment of rules supports differentiation.

5. The need to keep up to speed: Rapid change, at an ever faster pace, is a fact of life. In the Internet age, people expect almost instantaneous implementation of changes. How can line workers consumed with day-to-day activities ever hope to keep up?

Business rule solution: Real-time delivery of business logic to knowledge workers as errors actually occur creates a seamless, never-ending, self-training environment.

6. Knowledge walking out the door: By and large, baby boomers created much of the operational business capacity and operational systems we see in place in larger organizations today. Much of the related knowledge still sits in their heads—and nowhere else. What will happen when they retire? On a smaller scale, people with vital operational knowledge walk out the door almost every day.

Business rule solution: A systematic way of capturing, documenting, and retaining the business rules prevents the loss of knowledge when people leave.

~~~~~~~~~~ Excerpted from Principles of the Business Rule Approach, by Ronald G. Ross, AddisonWesley, 2003, pp. xx-xxii. Note: This list of benefits was written a dozen years ago. It seems the more things change, the more they stay the same for business rules. About the only thing I would alter today is to add the following buzzwords for the respective benefits.

1. Consistency & Complexity 

3. Business Agility & Compliance

4. Customization & Personalization

6. Knowledge Retention

 www.BRSolutions.com

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Managing Know-How in the Knowledge Economy: What Role Do Business Rules Play?

I’ve been writing a lot recently about the knowledge economy and what makes a business smart. Let me dig a little deeper. The kind of knowledge I’m talking about might be better described as know-how.

know-how:  accumulated practical skill or expertness …  especially:  technical knowledge, ability, skill, or expertness of this sort[1]

Know-how that you can encode and retain is represented by business rules and the structured business vocabularies (concept models) on which the business rules are based.  Know-how is a subset, a small one probably, of knowledge.  Briefly, knowledge can range from practical to theoretical, from certain to probabilistic, and from frequently applicable to infrequently applicable.  At the risk of saying the obvious, you can’t run the day-to-day operations of a business on knowledge that is theoretical, probabilistic, or infrequently applicable.  In short, business rules are about know-how management, a strictly limited subset of knowledge management. Like knowledge, know-how can be either tacit (in people’s heads) or explicit.  The classic test for when knowledge is tacit is ‘lose the person, lose the knowledge’.  Obviously you want to retain know-how. As a senior manager recently put it, “No organization should depend on absent brains.”

know-how retention:  expressing know-how explicitly in a form understandable by business people and business analysts, and managing the know-how, such that it is always available for future reference or use (by those capable and authorized)

The over-time infrastructure needed to retain know-how is provided by a general rulebook system (GRBS).  It’s what rule management should really be all about. ~~~~~~~~~~~~~~~~~~~~~~~ from Building Business Solutions: Business Analysis with Business Rules, by Ronald G. Ross with Gladys S.W. Lam, An IIBA® Sponsored Handbook, Business Rule Solutions, LLC, 2011, 304 pp,http://www.brsolutions.com/bbs

[1] Merriam-Webster Unabridged Dictionary

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“Business Rules Are Too Unstructured to Stand Alone.” Au Contraire!!

A Business Analyst recently said, “Business Rules themselves tend to be too unstructured to stand alone “. Au contraire! Well-expressed business rules are discrete, specific, and context-independent. Think about laws, regulations, contracts, agreements, deals, policies, etc. as common sources for business rules. Business rules are interpretations that make those things practicable. Those things can certainly stand alone. So can the interpretations. The test of ‘practicable’ (the term used in relevant standards) is ‘Can a worker who is authorized and capable know what to do or not to do as a result of reading it?’ Business rules must be well-structured to pass that test. More broadly, ‘practicable’ means ready to deploy into the business for workers to follow, or to pass over to IT as part of requirements in building systems – either way with the same results. Practicable business rules are encoded know-how of the business, vital operational IP. They are explicit, not tacit, so they can be retained, managed and re-used. Business rule management is the most practical means around for meaningful knowledge retention.

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What Role for Business Rules in *Knowledge Retention*? One of the ‘Must-Knows’ of Business Rules …

Celebrating the 10th Anniversary of the Business Rules Manifesto[1] http://www.businessrulesgroup.org/brmanifesto.htm FAQ #7 Question: How do business rules relate to knowledge retention? The classic test of whether knowledge is tacit or explicit is this: If you lose the person, do you lose the knowledge? Clearly, you want basic business know-how to be explicit, so a basic principle of the Manifesto is …

3.3. Rules must be explicit.  No rule is ever assumed about any concept or fact.

Rules capture and encode operational business know-how in a form that can be retained, managed and re-used. What are rules really about? A well-expressed rule is based on terms and facts (or more accurately, noun concepts and verb concepts). These concepts represent the basic stuff of the business – operational-level things that are talked about, managed and processed day-in and day-out, often many, many thousands of times. Rules provide criteria that guide this operational activity in a consistent way. So the Manifesto emphasizes …

3.4. Rules are basic to what the business knows about itself – that is, to basic business knowledge.  

In business, of course, knowledge is not an end in and of itself. Rather, the goal is consistent application of the knowledge – as well as its continuous improvement. Achieving these goals requires that the people who understand the knowledge – business people, subject matter experts, and business analysts – be able to work with it directly and effectively. After all, the true test of knowledge quality is not whether an application program runs, but whether you get the right (or best) results. So the Manifesto says …

9.3. Business people should have tools available to help them verify business rules against each other for consistency.

In the plainest possible terms, IT professionals simply shouldn’t be the ones to determine whether business logic ‘works’.


[1] The Manifesto is free, only 2 pages long, translated into 15 languages. Have a quick look (or re-look!). No sign up required. Well worth your time.

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Business Rules Manifesto FAQ #1 – The *Business Rules Mantra*

Celebrating the 10th Anniversary of the Business Rules Manifesto http://www.businessrulesgroup.org/brmanifesto.htm Question: What does the business rules ‘mantra’ mean? The traditional business rule mantra, a central idea of business rules, dates back to at least the mid-1990s. It is expressed in the Business Rules Manifesto (Article 3.1) this way:

Rules build on facts, and facts build on concepts as expressed by terms.

Perhaps not obvious in the statement is the insistence on declarative expression of business rules. When business rules are expressed declaratively, no meaning (semantics) can be hidden in the sequence of the statements (“in between the lines”). Literally, you can read the statements in any order, and get the same meaning. The liberation of business rules from procedural means of capture and expression (e.g., processes, procedures, use cases, etc.) means that each statement can be validated on its own merit. It also produces the highest degree of reusability (for the business rules). The importance of ‘rule independence’ is expressed by the subtitle of the Manifesto: The Principles of Rule Independence. What do you get when you express business rules declaratively? Encoded knowledge, or as I prefer to say, know-how. The importance of capturing and retaining core business knowledge (know-how) is even more urgent today than when the Manifesto was written in 2002. It is emphasized by the heading of Article 3: Deliberate Knowledge, Not a By-Product (of requirements and IT development). Additional Note: In early 2012, SBVR was revised to focus more directly on real-world language and concepts (always its original intent)[1]. So the Mantra today would be more accurately expressed:

Business rules are based on verb concepts, as expressed by wordings. Verb concepts are based on noun concepts as designated by terms and names.

Literally, you need nouns and verbs to write sentences. A good business rule statement is always a sentence.      

[1]For discussion, see ‘Concept Model’ vs. ‘Fact Model’ … Where in the World are the Instances? http://goo.gl/Oz6UA.

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