Operational Decision Management


Document Extract

Many of the latest initiatives in the IT world are focused around aligning IT resources more closely with business users and business needs. The more that IT can reduce the gap between the requirements of the business community and the fulfilment of these requirements, the greater the improvement in business performance. Companies become more agile and responsive to market changes and new opportunities; governance and risk can be managed more effectively through better business-oriented visibility of operational execution; and processes can be streamlined and automated to improve customer service and reduce costs. This report focuses on one such area that has seen great strides recently, that of improved decision-making.

Executives often complain about inaccurate and untimely decision-making. Decisions should be made automatically at the point in time they are needed, and with greater accuracy. Too often, decisions have to be made manually and are based on inadequate data, are inconsistent and are difficult to inspect and validate. On top of this, even when improvements to decisions can be identified it takes far too long to implement them. What is wanted is a way to deliver automated operational decisions based on formalized decision-making criteria that the business community can inspect, validate, improve and update easily and quickly. The days of reviewing monthly reports to decide on necessary actions are long gone; instead, dynamic agility is required to remain competitive and seize new opportunities. Two key technologies have emerged that are helping companies take great strides towards these objectives; Business Rules and Business Events.

Business Rules Management Systems (BRMSs) enable operational decisions to be taken automatically in real time by an embedded Business Rules Engine (BRE), based on documented rules that evaluate all the necessary information related to the decision and then come to the desired result. These rules therefore lay out the procedures currently in place that dictate how IT-based business operations are carried out, and the BRMS provides access to these rules in business terms so that the business community can author, edit, modify and inspect them as needed. Because these rules control operational execution, changing them will immediately modify decision-making, removing any need for IT application changes and the associated delays. Business agility is improved, costs are reduced and decision-making is streamlined. In addition, the visibility of the rules governing operational decision-making to business executives ensures that current procedures can be properly validated, resulting in more effective and efficient compliance management and greater decision accuracy.

BRMS technology opens up significant new opportunities for business success. For instance, the ability to automatically make different decisions in real time based on execution-specific information, such as the customer or client details and previous trading history, enables a higher degree of personalization and hence better business outcomes. But decision-making can also be extended through the use of business event processing (BEP) technology, which enables decision-making rules to take into account business performance and activities over time and across the wider enterprise. This really carries operational decision-making into a different dimension; now decisions can take into account not only execution-specific, point-in-time information but also trending information as well as information coming from other processes and applications across the enterprise. This extension opens up the way to more predictive operational decisions that can take into account business performance data across all aspects of business execution, but that are still actioned automatically without delay.

The rest of this report looks a little more deeply at the world of rules-based operational decision-making, showing how it can deliver better business outcomes through decisions that are automated and rigorous but at the same time flexible and open to inspection.

Document TOC

Executive Summary 2

Introduction 3

Rules-based decision management 4

Business Rules 5

Business Events 6

The role of Business Process Management 6

What IT technology is required? 7

Business Rules Management System (BRMS) 7

Business Event Processing (BEP) 8

Rules-based decision-making benefits 9

Customer focus 9

Business agility 10

Cost reduction 10

Governance 10

Smarter business operations 10

Business rules and events in action 11

Rules-based decisions in banking – Customer focus 12

Rules-based decisions in banking – Business agility 12

Rules-based decisions in banking – Cost reduction 13

Rules-based decisions in banking – Governance 13

Rules-based decisions in banking – Smarter operations 14

Summary 15

Document Audience

Senior managers (IT and Business)

Senior architects


Making better business decisions with flexible, automated business rules and events

This Lustratus Report take a high level look at the area of operational decision management, working through the drivers affecting industries today and how operational decision management can help companies cope with current market pressures. It looks in particular at Business Rules as a way of managing these operational decisions to ensure the decisions are repeatable, accurate and timely.



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