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Posts Tagged ‘under business jurisdiction’

‘Business Rule’ Means These 3 Things

Software vendors and others mislead people (badly) about the true meaning of business rule. Let’s set the record straight. The OMG standard SBVR (Semantics of Business Vocabulary and Business Rules, 1.4) defines business rule as a rule that is practicable and is under business jurisdiction. The definition has these three parts: (1) rule, (2) practicable, and (3) under business jurisdiction. Let’s look at each part in turn. 1. Rule Rule in business rule means real-world rule – in other words exactly what the dictionary says rule means. Here are the relevant meanings of rule from Merriam-Webster Unabridged Dictionary [MWUD].

guide for conduct or action [MWUD ‘rule’ 1a]

one of a set of usually official regulations by which an activity (as a sport) is governed [e.g.,] *the infield fly rule* *the rules of professional basketball* [MWUD ‘rule’ 1f]

A real-world rule always tends to remove a degree of freedom.  If it does not, it’s not a rule. Also, a real-world rule is declarative. It never does anything. It merely shapes behavior or decisions. If you’re using an approach where rules can actually do things (e.g., execute an action, set a flag or variable, call a function, etc.), they’re not business rules. You’re in TechnologyLand, and a procedural one at that. 2. Under Business Jurisdiction    Business rule includes only rules that the business can opt to change or to discard. A business rule is always under business jurisdiction of your organization. The important point with respect to external regulation and law is that your organization has a choice about how to interpret the regulations and laws for deployment into its day-to-day business activity – and even whether to follow them at all. So external regulations are not business rules per se. Business rules include only the rules that a business creates in response to external regulation. SBVR explains:

“… legislation and regulations may be imposed on [the company]; external standards and best practices may be adopted. 

These things are not business rules from the company’s perspective, since it does not have the authority to change them. 

The company will decide how to react to laws and regulations, and will create business rules to ensure compliance with them.  Similarly, it will create business rules to ensure that standards or best practices are implemented as intended.”

3. Practicable Practicable means a rule is sufficiently detailed and precise that a person who knows about it can apply it effectively and consistently in relevant circumstances. In other words, the person will know what behavior is acceptable or not, or how some concept is to be understood. A practicable business rule is one ready to become a deployed business rule – i.e., applied in day-to-day business activity. Whether the guidance is to be deployed to staff or ultimately to machines is immaterial. You should get the same results either way. Business policies are generally not practicable in this sense. Business rules always are. ~~~~~~~~~~~~~~~~~~~~ Excerpted from: Building Business Solutions: Business Analysis with Business Rules, 2nd edition, by Ronald G. Ross & Gladys S.W. Lam, 2015 Get the book:http://www.brsolutions.com/b_building_business_solutions.php Get the training: Instructor-led, online, interactive training: October 4-6, 2016 – Business Analysis with Business Rules: From Strategy to Requirements. http://www.attainingedge.com/online-training-business-analysis-with-business-rules.php ©Business Rule Solutions, LLC 2016. wwwBRSolutions.com 

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The Two Fundamental Kinds of Business Rules: Where They Come From and Why They Are What They Are

The two fundamental kinds of business rules relevant to business analysis are definitional rule and behavioral rule. These two kinds of rule come from OMG’s SBVR (Semantics of Business Vocabulary and Business Rules) standard.[1] They have very precise meanings based on formal logic. Here’s some background about that – more than business analysts really need to know, but informative nonetheless. At the end of the discussion I give pragmatic definitions. And the answer to the photo quiz. The SBVR definition for rule is deeply embedded in formal logic, which deals with propositions.  In modal logic, propositions can claim different modes. For business rules the two relevant modes are alethic and deontic.  
  • Alethic rules are true ‘by definition’. As such they cannot be violated.  They are about how concepts, knowledge or information are defined or structured.
  • Deontic rules are rules that can be violated. They are rules about behavior, not concepts, knowledge or information. Deontic rules are really about people, what they must and must not do, even if their activity (and the rules) are automated.
Both kinds of rules are important, of course, but deontic rules – people rules – are especially so since ultimately, businesses are about the activity of people. This situation is very different than in the semantic web, for example, where it’s all about only knowledge. Under modal logic, every rule must therefore ‘claim’ one of two modes. (In practice, the ‘claim’ arises naturally from the syntax of a rule statement or as a meta-property.)
  • Alethic implications (rules) are established by ‘claiming’ necessity. Things are necessarily true. A concept is what it is; says what it says. That’s just the way things are.
  • Deontic implications (rules) are established by ‘claiming’ obligation. Behavior is ‘obliged’ to follow the rule. But of course, people don’t always follow the rules, so there can be violations. Major difference.
So a rule ‘claims’ either necessity or obligation, which establishes what kind of rule it is. Therefore the SBVR definitions for the two kinds of rule are:
  • Definitional rule:  rule that is a claim of necessity
  • Behavioral rule:  business rule that is a claim of obligation
Why doesn’t the definition for definitional rule say “business rule” like the one for behavioral rule? Because some definitional rules are not ‘under business jurisdiction’ (in other words, business has no choice about them). Examples include the ‘law’ of gravity and all the rules of mathematics. Those rules are simply universally true. I recommend the following pragmatic definitions for business analysts.
  • Definitional rule:  a rule that indicates something is necessarily true (or untrue); a rule that is intended as a definitional criterion for concepts, knowledge or information
  • Behavioral rule:  a business rule that places an obligation (or prohibition) on conduct, action, practice, or procedure; a business rule whose purpose is to shape (govern) day-to-day business activity
Synonyms:  Early in the development of SBVR I introduced the terms structural rule and operative rule for the two kinds of rules, respectively. That was before the full implications of modal logic became clear. Since then the terms definitional rule and behavioral rule have become preferred, even in all internal SBVR discussion. The synonyms, however, remain valid. P.S. Did you guess correctly which kind of rule is represented in the photograph? Behavioral, of course. And the photo itself is a violation of the rule. www.BRSolutions.com


[1] For more information about SBVR see the SBVR Insider section on www.BRCommunity.com.

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What is a Business Rule?

It’s become more and more apparent that software vendors are misleading people (badly) about the true meaning of ‘business rule’. Time to set the record straight. Here is an authoritative 3-part explanation. Take a moment and reacquaint yourself. As a business-oriented professional you’ll be glad you did!

   Reference Sources

[MWUD] Merriam-Webster Unabridged Dictionary (Version 2.5).  [2000].  Merriam-Webster Inc.
[SBVR] Semantics of Business Vocabulary and Business Rules (SBVR) (Version 1.0).  [January 2008].  Object Management Group.
  1. Rule When we say rule we always mean real-world rule. Here’s the dictionary meaning of “rule”. That’s what we mean.

[MWUD ‘rule’ 1a]:  guide for conduct or action; [MWUD ‘rule’ 1f]:  one of a set of usually official regulations by which an activity (as a sport) is governed [e.g.,] *the infield fly rule* *the rules of professional basketball* ; [MWUD ‘criteria’  2]:  a standard on which a decision or judgment may be based

A real-world rule always tends to remove some degree of freedom.  If it does not, it’s not a rule.  2. Under Business Jurisdiction    When we say business rule we mean only rules that the business can opt to change or to discard. A business rule is always under business jurisdiction of your organization.  The point with respect to external regulation and law is that your organization has a choice about how to interpret the regulations and laws for deployment into its day-to-day business activity – and even whether to follow them at all. So external regulations are not business rules per se. Business rules include only the rules that a business creates in response to external regulation. SBVR explains: 

“The laws of physics may be relevant to a company … ; legislation and regulations may be imposed on it; external standards and best practices may be adopted. 

These things are not business rules from the company’s perspective, since it does not have the authority to change them. 

The company will decide how to react to laws and regulations, and will create business rules to ensure compliance with them.  Similarly, it will create business rules to ensure that standards or best practices are implemented as intended.”

3. Business Rule

[SBVR]:  a rule that is under business jurisdiction

A business rule is a criterion used to:
    • guide day-to-day business activity
    • shape operational business judgments, or
    • make operational business decisions. 
A number of years ago, a colleague of ours, Mark Myers, came up with a highly pragmatic test to determine whether some statement represents a business rule or a system rule.  It almost always works.  Imagine you threw out all the systems running your business and did it all by hand (somehow).  If you still need the statement, it’s a business rule.  If you don’t, it’s not.  A colleague on the SBVR standardization team, Don Baisley, puts it another way:  “Business people don’t set variables and they don’t call functions.” Some people think of business rules as loosely formed, very general requirements.  Wrong.  Business rules have definite form, and are very specific.  Each should give well-formed, practicable guidance Here are a few simple examples expressed in RuleSpeak:  

A customer that has ordered a product must have an assigned agent. 

The sales tax for a purchase must be 6.25% if the purchase is made in Texas. 

A customer may be considered preferred only if the customer has placed more than $10,000 worth of orders during the most recent calendar year.

Business rules represent a form of business communication and must make sense (communicate) to business people.  If some statement doesn’t communicate, it’s not a business rule. 

Consider this example:  If ACT-BL LT 0 then set OD-Flag to ‘yes’.  Not a business rule. 

Consider another example:  An account must be considered overdrawn if the account balance is less than $0.  This statement communicates and therefore is a business rule. 

More observations about business rules:
    • In SBVR a business rule can be either a behavioral rule or a definitional rule.
    • Business rules can be technical, but only in terms of the company’s know-how or specialized product/service, not in terms of IT designs or platforms.
    • Expression of business rules should always be declarative, rather than procedural.
    • A business rule statement should use terms and wordings about operational business things that should be based on a structured business vocabulary (concept model).
    • Your company’s business rules need to be managed and single-sourced, so we strongly recommend rulebook management.
Business rules are not about mimicking intelligent behavior, they are about running a business Mimicking intelligent behavior in a generalized way is far harder (an order of magnitude or more) than capturing the business rules of an organization.  Unfortunately, expert systems have generally focused on the former problem, causing considerable confusion among business practitioners.  ~~~~~~~~~~~~~~~~~~~~  Excerpted 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

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