Decision Analysis: Don’t Drown in DecisionsConsider the following examples of decisions arising in a regulated environment (acks James Taylor):
Government agency in Europe has regulations relating to Social Benefits. The agency itself must make decisions like “Is this person eligible for this benefit?” and “How much benefit, and for how long, is this person entitled to?”” that conform with those regulations.
An individual company might also have a decision like “Is this person entitled to paid leave to care for a sick child?” that is dependent both on company policy/practices and regulations that relate to social benefits (because they might require companies of a certain size to pay for this kind of leave).My Analysis Indeed, these are operational business decisions. I’m not surprised, by the way, they are in effect about money. Of course money entails decisions! But here are two important observations. 1. Regulations typically include a great many one-off behavioral rules (“one-off” meaning following no particular pattern). Examples might include:
- Payment of benefits shall cease immediately upon the death of the beneficiary.
- Payment of benefits shall not be made to any beneficiary living outside the country for more than 9 months of a fiscal year.
- Payment of benefits shall not be made directly to any minor.
Aside: Business vocabulary is as always obviously important. For example, does “payment” mean “accrual of benefit”, “act of payment”, “amount of payment”, or something else? No small issue.(2.) Consider the following (one-off) behavioral rule:
A non-citizen may cash a payment of benefits for a citizen only if married to that citizen and the citizen is not deceased.What happens in the case of death or divorce, and then the non-citizen tries to cash a payment? There’s no organizational decision involved there. There’s a personal decision … the non-citizen can decide to try to violate the rule … but we don’t really care about that. We only care about detecting the violation. We really don’t need or want an (operational business) decision here, do we? Again, if you have a decision for every possible kind of violation of every behavioral rule, you’ll very quickly drown in decisions. Don’t go there!
Tags: automonmous behavior, behavioral rules, business rules and smart processes, decision analysis, decision models, decision rules vs. behavioral rules, decision-making systems, decisions, one-off rules, regulations, smart business, smart processes, violations, violations of rules