- IT needs to be aligned with the business.
- Business capabilities need to be aligned with business strategy.
If 2 calls disconnect within 10 minutes, then offer a product discount.What’s the insight and what’s the rule? Does the statement represent both? Does it express a business rule? The syntax of the statement is in if-then form. Doesn’t that imply a business rule?! No! According to the standards SBVR and the Business Motivation Model (BMM), business rules must be:
We can assume people are getting frustrated at the 10 minute mark or before. If we offer a product discount, they’ll be mollified and more likely to hold on or to purchase.What should we call the statement? It does give guidance and it does clearly have a role in strategy. However, neither the insight nor the remedy is practicable. Here are some unanswered questions that could produce ambiguity.
The insight part: Does the 10 minutes refer the wait period on each individual call? Or to any time interval during which calls are waiting?
The remedy part: How much discount? On which product(s)?So according to the standards the statement represents a business policy, not a business rule. A corresponding business rule might be:
A caller must be offered a 15% discount off list price on any product in stock if the caller has been on hold for more than 10 minutes.This version removes the ambiguities. It clarifies that we’re referring to:
2a(1): a statement of a fact or relationship generally found to hold good : a usually valid generalizationLet’s call this meaning rule1. It roughly corresponds to insight … i.e., “as a rule we find that …”. It’s experiential – based on evidence.
1f: one of a set of usually official regulations by which an activity is governedLet’s call this meaning rule2. It roughly corresponds to the underlying sense of business rule … i.e., “It’s necessary or obligated that you must …”. It’s deliberate, based on policy. Job one in analysis of big data is to identify interesting relationships (rule1) and then deliberately formulate business rules (rule2) to produce outcomes desirable for your company. In other words, starting from rule1 you want to move expeditiously to rule2. Logicians have been on top of this distinction for a long, long. Only they speak in terms of implications, not rules. There are two kinds of implications – material and logical. Let’s repeat the discussion above using these terms. Don’t overlook the word strictly in the second definition. material implication (rule1)
2b(1) : a logical relationship of the form symbolically rendered *if p then q* in which p and q are propositions and in which p is false or q is true or bothlogical implication (rule2)
2b(2) : a logical relationship of the form symbolically rendered *if p then strictly q* in which q is deducible from pLet me repeat myself on job one in analysis of big data using implication:
Job one in analysis of big data is to identify material implications (rule1) and then deliberately formulate logical implications (rule2) to produce outcomes desirable for the company. In other words, starting from material implications (rule1) you want to move expeditiously to logical implications (rule2).I use “business rule” only for a statement of the rule2 variety, and only if that statement is both declarative and practicable. A statement has to prove itself to be a business rule – it’s only a pretender if it fails to meet the standards.
Business Policy: Safety is our first concern.
Business Rule: A hard hat must be worn in a construction site.It’s very important to retain information about these interpretations for the sake of traceability. That’s at the heart of business rule management. Business policies are an integral part of strategy. In general, we find only 2-3% of business rules trace directly back to strategy. But those *core* business rules are very, very important (to enforce and monitor). One last point: Business rules must be expressed in a form that is understandable to business workers (who are authorized and capable). What IT usually specifies or implements as ‘business rules’ aren’t. They might be rules, but not business rules. And what do I mean by “rule”? Exactly what it means in the real world – ‘guide for conduct or action’ (Merriam-Webster Unabridged).
“I especially liked the discussion about the mission and goals. I still see business process analysis in organizations I visit where the goals are not articulated well, and the results are not useful. (I’ve done it myself.) It’s easy to get lost among the trees, unaware of the contours of the forest or what direction you’re going.”Indeed! That’s why we came up with the Policy Charter, which is the deliverable in our approach that lays out the elements of strategy and their motivation. A Policy Charter is all about business goals, business risks, and business policies. It’s not about business process!  How do you distinguish between good business strategy and bad business strategy? Noted strategy expert Richard Rumelt distinguishes the good and bad as follows. Good Business Strategy Rumelt, p. 20: “good strategy requires leaders who are willing and able to say no to a wide variety of actions and interests. Strategy is at least as much about what an organization does not do as it is about what it does.” Rumelt, p. 243: “good strategy is, in the end, a hypothesis about what will work. Not a wild theory, but an educated judgment. And there isn’t anyone more educated about your [business] than the group in [the] room.” Bad Business Strategy Rumelt, p. 32: Bad strategy “… is not simply the absence of good strategy. It grows out of specific misconceptions and leadership dysfunctions. To detect a bad strategy, look for …