Operational business decisions happen every minute of every day in your organization. You’d like to think that business managers can truly manage them. You’d also like to think that the results of those decisions are comprehensively correct, consistent, traceable, and repeatable (high quality). But are they? Based on real-life evidence I strongly suspect they often are not. Let’s be clear what kind of decision I mean. Say “decision” and many business people immediately think strategic decision (e.g., whether to enter some new market), or tactical decision (e.g., which supplier to use for a year-long special project). Those are not the kinds of decision I’m not talking about. I’m not talking about project decisions either. When IT professionals talk about “decisions” they often mean branch points within the deep systemic logic executed by machines – classic decision points in data processing. I don’t mean that either. Instead, I mean decisions in the day-to-day, minute-to-minute bread-and-butter operations of the business. Some examples of such operational business decisions:

• Whether to give a mortgage to a given applicant.
• What discounts a premium customer will receive on a purchase.
• Which customer gets preference if some product or resource is in short supply.

Your business makes these kinds of decisions hundreds or thousands of times a day – or hour, or minute. These are the kinds of decisions that regulators, auditors, and compliance officers care about. The kind your business partners deem important because they are directly impacted.   Are the decisions high quality? At a major insurance company a thoroughly competent, highly experienced business system analyst recently told us: “When we looked hard at business rules currently implemented in existing systems, we found at least 30% were flatly wrong.” After a moment’s reflection he added, “That’s a very conservative estimate; the actual figure was probably much higher.” The organization was just beginning to recognize the magnitude of the problem. And whose problem is it? The analyst said, “IT told us they couldn’t solve the problem because it was a business issue not a software issue. And they were absolutely right about that.” We might have thought this case an outlier if we hadn’t heard similar estimates from credible sources in many other companies. And we’ve found the same ourselves. Not long ago we were asked to conduct an audit of implemented business rules in one area of business for a major North American bank. The results frankly astounded us. We double- and triple-checked. No error. To conduct the audit first we harvested 518 business rules from the relevant Policies and Procedures Manual, the printed (and on-line) reference source for loan officers, and expressed them in RuleSpeak. How many business rules were implemented correctly in their automated system? We found zero – zero! – fully aligned. Some 447 were actually not implemented at all; the remainder just partially aligned. You wouldn’t think it possible but it gets even worse. We found 261 business rules implemented in their system that did not appear anywhere in the Manual. What sort of way of doing business is that?! Who (or what!) is making the decisions?! To put things in proper context it helps to appreciate the costs associated with maintaining legacy systems not built on business rules. In a recent visit to a very large health care organization, a high-level manager cited the following statistics. They’re staggering. He reported it takes their organization:

• 24 person-years per year to maintain a 30-year old monolithic COBOL legacy system.
• 400 person-days over a 4-month period to make changes to business rules of ‘moderate’ complexity.

The manager admitted sadly, “Truth be told, we work for our legacy systems, not the business.” Beyond these frightening costs the manager also described how a subtle stagnation had crept into the staff’s very way of thinking about their business. “Our business leads are so familiar with the limitations of our legacy systems, they don’t even consider business innovations they know from experience to be difficult for the system to handle. Sometimes I wonder if they can even think through innovation effectively anymore.” With variations it’s a story we hear time and time again. The need for innovation is ever more immediate, but the reality of achieving it ever so distant. Who (or what) is making the decisions is in your organization?! At BRS, we have dedicated ourselves to pioneering innovative techniques for achieving order-of-magnitude improvements in how businesses literally operate themselves. We offer no silver bullets. It’s heavy lifting to put an organization onto a different track with respect to their core knowledge practices. Is it worth it? Absolutely. When we see control over decisions coming back where they belong – into the hands of business managers – the results are always extremely rewarding.

Quality must be viewed very differently in the white-collar world. The traditional view simply doesn’t fit. In Henry Ford’s day, for example, central to the concept of mass production was standardization of parts. That idea leads directly to the notion of manufacturing tolerances – i.e., upper and lower limits for parts in 3-dimensional space. The goal is to ensure physical interchangeability of physical parts. That idea is now standard practice, of course, across manufacturing and production sectors. But what are the ‘parts’ in white-collar work? White-collar processes simply don’t deal with physical things. How can you identify tolerances for them in 3-dimensional space? You can’t! In a very real sense, the ‘parts’ in white-collar work are literally just bits and bytes. If not tolerances as a basis for quality, then what’s the proper focus? My answer: consistency and reliability of results. For example, if I visit ten different branches of the same bank about getting a mortgage for my dream home, shouldn’t I get the same answer on my application from all 10 branches?! As you perhaps have experienced yourself, that’s not the way it works in many banks today. So one aspect of quality in white-collar work is the consistency and reliability of operational business decisions. Another aspect of quality concerns compliance. Every business is subject to ever growing numbers of (take a deep breath here) … acts, laws, statutes, regulations, contracts, MOUs, agreements, terms & conditions, deals, bids, deeds of sale, warranties, prospectuses, citations, certifications, receipts, legal notices … and the list goes on. Shouldn’t I expect consistency and reliability of results with respect to all those obligations and commitments? I believe we should. If it’s not about quality, then what?! My conclusion:When there isn’t any physical product from a business process, quality and defects must be measured by consistency and reliability of results, which are in turn always purely a matter of business rules. For background on this post, see: http://www.brsolutions.com/2015/10/27/measuring-quality-and-defects-in-the-knowledge-economy/ ~~~~~~~~~~~~~~~ www.BRSolutions.com

Comment by DMN proponent: In common business use the term “decision” is often overloaded to mean “decision output”. So I “make a decision to do X” is the act, whereas I “use the decision as input to another decision” is referring to the decision output. I’m not sure there are any semantic issues with (i.e. possible problems caused by) this overloading? My response: Since DMN is a standard (and in particular claims to be a business standard), then it must stick with its own definition of terms in all cases. Otherwise, in what sense is it a standard (especially a business standard)? In defining “decision” DMN had two fundamental choices (from Merriam-Webster Unabridged dictionary): 1. a : the act of deciding; specifically : the act of settling or terminating (as a contest or controversy) by giving judgment 1. b : a determination arrived at after consideration : SETTLEMENT, CONCLUSION DMN explicitly chose the first meaning. I strongly prefer the second, but then I’m a big fan of all things declarative. So in BRS TableSpeak[1] an outcome by definition is a decision. Since DMN explicitly chose the first meaning, however, an outcome (conclusion) is by definition *not* a decision. A decision is an act, never the result of the act. Hey, I’m just reading what is written in the standard. If DMN somehow allows ‘overloading’ of the term “decision” — the central term in the standard — all bets are off. A term that you can use any way you want when it happens to suit you is a term that has not been standardized at all. The result is semantic muddle. Pretty big deal. Sorry! www.BRSolutions.com  

Consider 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.

Is decision analysis suited to capturing/interpreting such one-off rules? Is it meaningful to have a decision such as “Should a benefit payment be made?” Shouldn’t such behavior be presumed automatic (but traceable and adaptable)? A better option is to simply have a task or action such as “Make payment”. Violations of related business rules for any particular case produces exceptions, possibly to be addressed by appropriate messages and/or procedures invoked automatically. That’s how basic business behavior becomes autonomous, so the business can concentrate on matters requiring greater skill, experience or intelligence. If you’re not careful everything becomes a decision. Where do you draw the line? Isn’t there a difference in simply being competent vs. being smart in doing business?

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!  

Consider the following example.

Behavioral Rule: A student with a failing grade must not be an active member of a sports team.

This business rule:    

• Is not about selecting the most appropriate sports team for a student – i.e., not about the decision, Which sport team is best for a student?.
• Does not apply only at a single point of determination – e.g., when a student joins a team.

Instead, the business rule is meant to be enforced continuously – for example, if a student who is already active on some sports team should let his or her grades fall. What’s the business decision for when a student’s grades fall and they should be taken off a team? Be real, there’s no good answer to that question. This example is no outlier. Businesses have 1,000s of behavioral rules like this. Let’s be clear – I believe a business-decision-based approach is very powerful for decision rules. I have written much about that. And I don’t disagree that many business-rule projects have floundered due to lack of pragmatic organizing principles (e.g., “decisions”). But if you take a decision approach to behavioral business rules, either it will prove woefully incomplete with respect to integrity, or you’ll quickly start to drown in (system-level) decisions. In my opinion, an application that has to be designed and to operate to treat violations of behavioral rules as just more decisions is not a smart enough system. The detection of violation events for behavioral rules can be, and should be, completely under the covers (identified, detected and supported by a platform). Otherwise the solution won’t scale. And there will be so many decision dependencies it will steal from the very real value of a business-decision-based approach. This frankly is a sign of immaturity … or lack of imaginative leadership … or IT bias … or whatever … in some parts of the decision-model community. The detection of a violation of a behavioral rule is an event, not a decision. A business decision is a business decision; a system decision is … well … why even go there?! P.S. There are 3 specific examples and more complete discussion about this topic on http://goo.gl/NCnLi.      

A person close to the DMN (Decision Model Notation) standard recently wrote about its definition of “decision”: “This means a technical rather than business-person definition of ‘decision’, as the businessperson is not the target audience for the specification (metamodel) but of the results of the specification (models).” My Response Well, that’s a shame. Many people will be looking toward the DMN for a business vocabulary they can use in communicating with business people. So the communication gap between IT and business is not being closed in the area. My personal opinion is:

• Computers have become so powerful these days that they should be speaking *our* language (in structured, carefully defined form), not the other way around.
• Standards (and standards organizations) that fail to move the ball forward in that regard are failing its audience in the larger sense, no matter how good the standard for its chosen area. (And I do hope DMN is good in that latter sense.)

A person close to the DMN (Decision Model Notation) standard recently wrote:

In DMN a decision is deliberately defined very broadly … 

“a decision is the act of determining an output value (the chosen option), from a number of input values, using decision logic defining how the output is determined from the inputs”.

Decisions in DMN can be automatic, they can be used for detection, the logic they use can concern the violation of constraints; I see no problem with any of this.

My Response

• A motorist goes thundering down the motorway, well over the speed limit. A radar gun detects it. What “decision” was made? Would a business person ever say the radar gun “decided” the motorist was speeding? … “Determined” maybe; “decided” no.

• A company has the (behavioral) business rule:

 A customer that has placed an order must have an assigned agent.

An agent servicing customers who have placed orders retires and moves to Florida (this last part irrelevant). What “decision” is it that says, hey, now have some unrepresented customers and somebody ought to do something about it ASAP?? What “decided” there are now violations?? … “Detection yes”, “decision” no. 

P.S. That definition of decision seems a bit circular. To know what a “decision” is I need to know what “decision logic” means. But since “decision logic” says “decision”, seems like I need to know what “decision” means. Hmmm.

A person close to the DMN (Decision Model Notation) standard recently wrote:

I can’t see how you can object to the idea that decisions can be automatic, or used for detection, unless you maintain that decisions can only be taken by people?

  My Response Putting theological questions aside, in the beginning there was man. Well, people. Well, animals and people. As far as science is currently aware, there is nothing else in the universe that can “decide” something. Well, let’s put quantum mechanics aside. How things get “decided” there is just plain weird. That’s not human scale anyway (as far as science is currently aware). My point is that the concept “decide” makes absolutely no sense unless you acknowledge that “deciding” is a human concept. People decide stuff (or decide when things have been “decided”.) When Machines “Decide” Can machines “decide” things? Of course. Can they often “decide” things better than humans? Of course. Can they often “decide” things instead of people? Of course. Would you call what it is the machines do in such cases “deciding” if there were no people who could do the thing we call “deciding” in the first place? Of course not. “To decide” is fundamentally a human characteristic. If you try to remove the “human” sense of “to decide” from the verb, it’s not how the average person would understand it. This sense comes across clearly in the real world definition of “decide” [MWUD]: to dispel doubt on. When Machines “Doubt” Can machines “doubt”? I’ll let the philosophers decide that (yes decide). I’ll just say this: I doubt (yes doubt) it would be called “doubt” unless people experienced “doubt” in the first place. So when you use the word “decide”, even for what machines are doing, use it for things that people would call “decide”. If you want to use the word “decide” for machines in some other way – for things that people wouldn’t call “decide” in the real world – then please, just plainly admit you’re in systemland, not in peopleland.

A person close to the DMN (Decision Model Notation) standard recently wrote:

In DMN a decision is deliberately defined very broadly … 

“a decision is the act of determining an output value (the chosen option), from a number of input values, using decision logic defining how the output is determined from the inputs”.

My Response I’ve already written that the DMN definition of “decision” seems to be a bit circular. (To know what a “decision” is you need to know what “decision logic” means. But since “decision logic” says “decision”, seems like you need to know what “decision” means.) Let me tell you what else I find wrong with the definition. (All dictionary definitions from MWUD.) Problem 1. MWUD defines “decision” as (1a) the act of deciding. It defines “act” as (1a) a thing done or being done. So which is it? Is a decision a thing “done” or a thing “being done”? In other words, is a decision the result of an action or process, or the performance of an action or process? Big difference! Which does the standard mean? Some clarity would be nice. Problem 2. MWUD defines “decide” as: to dispel doubt on: (a) to arrive at a choice or solution concerning which ends uncertainty or contention *decide what to order for breakfast*  (c) to infer or conclude from available indications and evidence So the real-world definition of “decide” talks about …

• Arriving at “a choice or solution”.
• Basing that choice or solution on “indications and evidence”.

Do you see anything in that definition that reduces what is used in making decisions to “inputs” and “outputs”?! That’s ITspeak, not businessSpeak. So let’s not pretend the DMN standard is really about business modeling per se. It’s business reduced to a system view. Problem 3. “Input value” is definitely ITspeak. Fields and attributes in files and databases are what have this kind of “value”. In the business world, people talk about cases, applications (appeals, requests, petitions), communications, situations, circumstances, trends, profiles, and the like. They don’t talk about “input values” to a decision. Get real. Again, the authors of the DMN standard should either be clear it’s really about system stuff … or admit to causing confusion, deliberately or otherwise.

A person close to the DMN (Decision Model Notation) standard recently wrote:

“Under DMN we would say that the automatic detection of the violation of a constraint is indeed a decision.”

My Response … Which part of any definition of any of the following terms in your statement would in any way, shape or form lead to the notion of “decision”?!

• automatic
• detection
• violation
• constraint

You’ve put you finger squarely on the three confusions (shortcomings) I fear most from the DMN standard — failure to:

1. Comprehend that behavioral rules are a quite different animal from decision (or definitional) rules.
2. View “decision” from a businessperson’s point of view.
3. Define “decision” as meant in the real world.

Is this going to put another standard emanating from an IT background parading as a “business” paradigm? Another standard where hype beneficial to existing vendor products outweighs true clarity and innovative leadership? I am hoping for the best … I want the standard (if good) to succeed … but fear the worst. I’m afraid your statement doesn’t instill much confidence.