Enabling Operational Excellence
Enabling Operational Excellence
Enabling Operational Excellence
Enabling Operational Excellence

TURNING OPERATIONAL KNOWLEDGE & COMPLIANCE INTO A COMPETITIVE EDGE

We systemize tacit knowledge into explicit knowledge

Blog Enabling Operational Excellence

How Do Business Rules Apply to Service Workers vs. White-Collar Workers vs. Gold-Collar Workers?

There are two fundamental kinds of business rules: behavioral rules and decision rules.[1] 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/)[2] 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


[1]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.
[2]And follow-up posts everyday last week.

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How Do Service Workers (Pink-Collar) Fit with White-Collar and Gold-Collar Workers?

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 people as nurses and teachers, who are clearly gold-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/)
    • 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

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Can You Differentiate ‘Knowledge Workers’ by How Much Improvising or Innovating is Desired?

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

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Can You Differentiate Between White-Collar Work and Gold-Collar Work by Whether It Can Be Automated?

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

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Is “Knowledge Worker” the Best Term for Decision Engineering?

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

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Knowledge Worker vs. White-Collar Worker: Opinions Needed

Knowledge worker is a term bandied about in discussion of business process management (BPM). Is it synonymous with white-collar worker, or different? How do you use the term? I ask because there’s significant new and significant interest in automating new areas of white-collar work so as to render it more consistent, traceable and scalable. That requires capturing and encoding the know-how as business rules and on a broader scale, engineering and automating operational business decisions. Knowledge is a very far-ranging term, and there are many forms of knowledge beyond day-to-day operations of a business. Does it confuse the issue to call white-collar workers “knowledge workers”? Is knowledge worker perhaps a broader term than white-collar worker? Which term works best in your organization? Here is some background information from Wikipedia. I confess I have never heard the term gold collar before, but it seems to me there’s an important potential difference there. White-Collar Worker

A white-collar worker is a person who performs professional, managerial, or administrative work. Typically, white-collar work is performed in an office or cubicle. Other types of work are those of a blue-collar worker, whose job requires manual labor and a pink-collar worker, whose labor is related to customer interaction, entertainment, sales, or other service oriented work. Many occupations blend blue, white and/or pink (service) industry categorizations.

Knowledge Worker

Knowledge workers are workers whose main capital is knowledge. … What differentiates knowledge work from other forms of work is its primary task of “non-routine” problem solving that requires a combination of convergent, divergent, and creative thinking.

Knowledge workers are employees who have a deep background in education and experience and are considered people who “think for a living.” They include software developers, doctors, lawyers, inventors, teachers, nurses, financial analysts and architects. As businesses increase their dependence on information technology, the number of fields in which knowledge workers must operate has expanded dramatically.

Even though they sometimes are called “gold collars”, because of their high salaries, as well as because of their relative independence in controlling the process of their own work, current research shows that they are also more prone to burnout, and very close normative control from organizations they work for, unlike regular workers.

www.BRSolutions.com

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MetaProcess vs. Something More than a Process

Amit Mitra, Senior Manager at TCS America, commented[1]: Is there such a thing as a metaprocess? Yes, there is! I am teaching the metaprocess in a master’s course … as a part of an overall model of knowledge that integrates reasoning, measurement, business rules, and process. Indeed, you can infer the business functionality required of the ideal BPM tool from the properties and parameters of the metaprocess (No current tools support them all, but they do support the most obvious properties). The metaprocess also accounts for progressively unstructured processes, and processes that reason about themselves, to infer how they could adapt to different situations. My reply: Interesting indeed. However, what is your definition of process? I think the key part of what a process is (and isn’t) is that it transforms something (turns raw material into finished goods, inputs into outputs). Business rules never transform anything – that’s a key differentiator from business processes. Reasoning and measurement ‘transform’ something only in a trivial sense. My point is that the thing you’ve created a meta- for isn’t really a process. It’s more comprehensive. It’s more like core business know-how or core business capability. The industry desperately needs a better name for the kind of thing you’re creating … because it’s central to moving toward a knowledge economy (and a more rational, sustainable way of doing business). ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Eric Ducos, CTO of EmeriCon, commented: Is there such a thing as a metaprocess? I would definitely think so. A methodology for identifying, analyzing and building a BPM solution is a metaprocess (i.e. a process to build a process). My reply: I agree except for the word methodology. A methodology is more than a process. It includes rules and guidelines, for example. Merriam-Webster Unabridged Dictionary (MWUD) defines methodology as (1a):

a body of methods, procedures, working concepts, rules, and postulates employed by a science, art, or discipline.

But here’s a thought: There could be such a thing as a meta-methodology … a methodology indicating how to create (other) methodologies. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ John Morris, Director, Solutions Sales at Bosch Software Innovations, commented: In terms of driving work on metaprocesses, I suspect that tort law, regulation and compliance issues might eventually prove to be motivators, more than competition. One might think that having good software would be guaranteed by competition, especially as the information content of most products and services is increasing. The governance challenge, however, is that the semantic content of software is buried by “what you see” – i.e., the surface of the software. All too often that’s where discussion stops. My reply: I couldn’t agree more. That gets you into rules and meta-rules – i.e., into something more than processes. http://www.brsolutions.com/


 [1] This series of point/counterpoint replies is a follow-up to my post “Meta Here. Meta There. Meta Everywhere?” (March 31, 2014), which generated a surprising amount of great discussion. (Thanks all!) Refer to: http://www.brsolutions.com/2014/03/31/meta-here-meta-there-meta-everywhere/ The definition I’m using for meta- is from Merriam-Webster’s Unabridged Dictionary [3b]:

3b: of a higher logical type – in nouns formed from names of disciplines and designating new but related disciplines such as can deal critically with the nature, structure, or behavior of the original ones *metalanguage* *metatheory* *metasystem*

 

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Meta Here. Meta There. Meta Everywhere?

As a young database professional in the mid-1970s I grew up on metadata – data that describes and defines other data. In fact, I wrote one of the first books explaining it from a data-as-corporate-resource point of view in 1980.[1] Who knew that in the 21st century there would ever be such a thing as big data, more dependent on metadata (if that’s possible) than even ‘regular’ (transaction) data?! Or that the metadata of phone conversations would become a central artifact in the struggle over civil liberties?! Back then it never much occurred to me that there could be other kinds of “meta”. Well, except maybe metaphysics. But you don’t want to go there. That’s some realm beyond physics where physics isn’t physics any more.[2] Anyway, I was wrong about there not being other important kinds of “meta”. Other Meta’s In the 1990s I learned there was such a thing as meta-rules – rules that govern rules. That led to RuleSpeak® – rules for expressing rules in structured natural language.[3] It also more recently led to new thinking about the engineering of governance – rules guiding the creation, approval and dissemination of business policies in an organization. (Think rulebook management as governance infrastructure.) I’m also pretty sure there could be metaprocesses – processes that orchestrate or transform other processes. It seems to me that one goal of intelligent agents is exactly that. What else? I’m no expert on that. What other meaningful kinds of “meta” are there? It’s fun to play with the question words where, who, and when, but I don’t think there are any real “meta’s” to those. I could be be wrong. Thoughts? I do have one strict rule for judging when you have something truly “meta”. Here’s my rule: Some meaningful verb(s), not a preposition, must be used in defining a “meta” thing. Examples we’ve already discussed:
  • Metadata – data that describes and defines data. (You should not say just “data about data”.)
  • Meta-rule – rule that governs rules. (You should not say just “rules about rules”.)
  • Metaprocess – process that orchestrates or transforms other processes. (You should not say just “processes about processes”.)
Where else could you look for “meta’s”? Merriam-Webster Unabridged Dictionary (MWUD) defines the kind of “meta” we’re discussing here as follows[4]:

3b: of a higher logical type – in nouns formed from names of disciplines and designating new but related disciplines such as can deal critically with the nature, structure, or behavior of the original ones

MWUD gives these examples (the verbs are mine):
  • metalanguage – language for discussing languages.
  • metatheory theory for structuring theories.
  • metasystem – system for organizing systems.
In science & research literature these days you commonly read about meta-analysis. An article in The Economist recently defined meta-analysis as “a technique which uses entire studies as single data points in an overarching statistical analysis”. In other words, an analysis that analyzes other analyses. I wonder if there is such a thing as meta-architecture – architecture for designing architectures? That’s certainly an interesting question, and I’m not certain I know the answer. Thoughts? I do know there’s meta-vocabulary – vocabulary that enables communication about vocabularies. That’s a central feature of the OMG standard SBVR (Semantics of Business Vocabulary and Business Rules).[5] I can tell you with great certainty that a meta-vocabulary is not the same thing as metadata – not by a long shot! I can also tell you that in a knowledge economy, meta-vocabulary will ultimately prove more important than metadata. The Ultimate Metas I believe there’s also such a thing as meta-knowhow – knowhow that enables the organizing of other knowhow. Unfortunately, as few business practitioners today know how important meta-knowhow is as knew how important metadata was in the mid-1970s. That will change. And it won’t take long. Meta-knowhow for organizing core operational business knowhow[6] is essential not only to play in the knowledge economy, but simply to contain the costs of operating as we do today. Best practices already exist for the area. Companies are paying a huge (and unsustainable) price for not engaging with them. I will have much more to say about meta-knowhow in the near future. The most interesting and powerful “meta” of all, however, has to be meta-idea – an idea that enables the birthing (ideation[7]) of (other) ideas. These are the things that bootstrap whole cultures to a new level of intellectual empowerment. Examples: (the ideas of) libraries, encyclopedias and universal education. In The Second Machine Age[8] the authors argue convincingly that with the internet’s true coming of age we’re living the next big meta-idea right now. It’s hard to argue the point. You (the reader) are experiencing it at this very moment. After all, how likely is it that we would be conceptualizing “meta” together here if it weren’t for the internet?! P.S. The concept “meta” is itself actually a meta-idea. Now there’s a good brain teaser if you want to play with it! www.BRSolutions.com


[1] Data Dictionaries and Data Administration: Concepts and Practices for Data Resources Management, by Ronald G. Ross, AMACOM (American Management Association), New York, 1981, 454pp. The definition of metadata in the preceding sentence is straight from the glossary, pp. 432.
[2] I mean the Merriam-Webster’s Unabridged Dictionary definition 1b(1): something that deals with what is beyond the physical or the experiential.
[3] See www.RuleSpeak.com. The RuleSpeak guidelines are free.
[4] MWUD’s meaning for metaphysics is different: 3a: beyond : transcending. It lists examples as metapsychosis, metageometry, metabiological, and metempirics (meta-empirics). Let’s not go there(!). The “meta” I mean (definition 3b) is far more specific and useful, even if highly abstract.
[5] Refer to the SBVR Insider section on www.BRCommunity.com.
[6] For discussion of operational business know-how, refer to my posts Single Source of Business Truth (http://www.brsolutions.com/2014/03/18/single-source-of-business-truth/) and Managing Know-How in the Knowledge Economy: What Role Do Business Rules Play? (http://www.brsolutions.com/2013/08/12/managing-know-how-in-the-knowledge-economy-what-role-do-business-rules-play/).
[7] MWUD definition: the process of entertaining and relating ideas.
[8] The Second Machine Age: Work, Progress and Prosperity in a Time of Brilliant Technologies, by Erik Brynjolfsson and Andrew McAfee, W.W. Norton & Company, New York, 2014, pp. 306.

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Single Source of Business Truth

Re-engineering knowledge work is the central problem of the knowledge economy. In recent work at Centers for Disease Control (CDC) and current work a major bank in Canada we used RuleSpeak® to create what I call a “single source of truth for operational business IP (intellectual property)”. This is far more than a conceptual data model. Beyond structured business vocabulary its central feature is comprehensive rules. It may be like what some professionals call a “conceptual ontology” (as opposed to an operational ontology to be embedded in IT systems). But we would never use the term “ontology” in our work.  Most business people and SMEs simply wouldn’t ‘get’ that. The idea is that all audiences (or subcommunities) in an organization should work off a single trusted source of explicit know-how (business vocabulary and business rules), no matter what their specific responsibilities:
    • producing training materials for line workers.
    • making changes in operational policies.
    • providing proof of compliance for auditors.
    • creating new products.
    • communicating with IT.
Here are some key observations about our work to create a single source of business truth:
    • Our primary audience is not IT. Yet our work is of sufficient precision that straightforward translation into an implementation form can basically be taken as a ‘given’.
    • Our approach recognizes that people are the essential ingredient in business (as opposed to other kinds of knowledge problems). People can violate rules. For coordinating the work of people, direct support for behavioral rules, not just definitional or decision rules, is a must.
    • Our work could not be undertaken without a structured natural language for business rules like RuleSpeak. The non-IT audiences do need rich business semantics, but they have no desire whatsoever to become semantic programmers. They simply would not commit if the work were conducted on that basis.
    • No one today knows what the optimal syntax is for expressing all forms of business know-how in all circumstances. I suspect there isn’t one. That fact, plus the exponential increase in computer capability for processing natural language, indicates clearly that focusing on syntax is simply the wrong direction. RuleSpeak is based on, and was one of the reference languages for SBVR (Semantics of Business Vocabulary and Business Rules, on OMG standard), which supports a non-syntax approach. A language for ‘speaking’ with computers that is not a computer language – now that’s an idea whose time has definitely come!
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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