Analytics & Optimization The McKinsey Quarterly: What global executives think about technology and innovation

Aug232005

The McKinsey Quarterly: What global executives think about technology and innovation is an interesting article about executives, business and IT, and what they think about technology. A couple of points struck me as interesting. More than half the IT execs (and nearly half of all the execs) see the ability to innovate as critical to growth. From an IT perspective, this surely means using IT resources to build innovate new systems not maintain or run existing systems. Automating business processes was the greatest driver of operating efficiencies for IT execs and a close second for all execs.This focus on process automation, driving to straight through processing, is clearly a top driver of efficiency. Talent and its cost was a top constraint for the business and for IT.Clearly the first two trends mean that IT must find, hire and deploy more top-tier talent to keep up with the need for automation and innovation. So what can we conclude from these trends? Clearly a business rules approach, and adopting a business rules management system such as Blaze...

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Analytics & Optimization Isn’t the business rules hype just a re-labeling of the whole expert systems fiasco of the 1980’s?

Aug222005

Expert Systems vendors promised that their packaged software would perform tasks just like the companies’ most experienced employees, with intelligence and best practices painstakingly collected from industry experts. By and large, the expert systems promise did not succeed in practical application. The companies who experimented with the systems became leery of computer software promising “intelligent processing.” And other companies who watched the phenomenon from the sidelines congratulated themselves on their caution. With this kind of checkered past, why should companies believe that they can successfully incorporate business rules into their computer systems now? To answer the question of then versus now, we can use hindsight to examine the problems leading to the downfall of commercial expert systems and see how modern rules management software has addressed them. Expert Systems were typically designed as "closed systems". They were designed to solve an entire problem on their own. They were not designed to support and integrate into...

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Analytics & Optimization Who are the major players in this space?

Aug222005

Are you a major enterprise-sized organization with a lot of rules and lots of programming disciplines to worry about? Then there’s really Fair Isaac Blaze Advisor and ILOG JRules – and then there’s everyone else. Those two are always noted as the major pure-play rule vendors. Pegasystems is the other big name in rules, but they concentrate more on combining rules and BPM into a single package than they do on selling stand-alone rules packages. JESS is the historical favorite in the techie world for getting into the game, because you can download their language and execution engine for free to start learning it and writing basic systems. But it’s a complex language and clearly made for the academic rules crowd. After those, you’ve got an awful lot of niche players and folks putting together their offerings. If you are wondering if the big boys… Microsoft and IBM are in the game? They have each flirted with offerings in this area (I know of several different rules offerings by IBM, for instance) but have not yet come out with anything serious. It...

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Analytics & Optimization What’s the difference between Business Rules Management Systems and Business Rules Engines?

Aug222005

A Business Rule Engine is one part of a complete system for handling all the things involved in working with rules. Admittedly, it’s an important part, but it deals only with execution… which rules need to be executed in what order? The big enterprise-oriented players are concerned with a lot more… There’s all the development and testing; linking up to data sources and other applications; measuring and reporting; deployment to different computing environments; making rule maintenance easy; looking for conflicts; and so on. Business rules management systems gives business users and analysts the ability to make routine changes and updates to critical business systems while freeing IT resources to concentrate on higher value-add projects and initiatives. The idea is that, using common business terms and familiar interfaces, business users and analysts can update business strategies across enterprise information systems.  This control of the business logic embedded in IT systems allows business users to alter application behavior without IT...

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Analytics & Optimization SOA – A New Blueprint for IT

Aug182005

CIO magazine had an interesting editorial today - A New Blueprint for IT - talking about the value and potential of SOA - Service Oriented Architecture. While a decentralized SOA application environment provides a great deal of flexibility for business units and IT departments, it also creates a new set of challenges: how can organizations effectively manage the consistency of business decisions delivered through various applications; and how can organizations reliably implement changes to business decision logic across all their services.  Business rules management systems provide a highly effective and efficient mechanism for managing decision logic and acting as a conductor in order to align decision behavior. Furthermore, implementation of a BRMS is a good first step in moving to a SOA-based environment. Business rules management systems (BRMS) provide a mechanism for managing decision logic and act as a conductor in order to align application decision behavior. Since BRMS are designed to deliver decisioning components, they are perfectly suited to SOA -...

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Customer Engagement High Performance Marketing: Justifying Your Analytic CRM Investments

Aug172005

This article by Steve Schultz, High Performance Marketing: Justifying Your Analytic CRM Investments. does a great job of articulating some of the ways for justifying an analytic CRM investment. In a number of these areas the use of EDM tools like business rules and executable predictive analytic models starts to increase the value of each technology. For example: Business Intelligence/ReportingThe revenue enhancements identified - quicker business decisions, more effective cross-sell, more accurate customer retention decisions - can all be greatly enhanced if decision automation has been used to leverage this data automatically across all touch-points, not just those with human intervention. Analytics/Data MiningIf the data mining technology is used to mine for business rules, such as customer segmentation ruels, and these are implemented in the systems backbone then the cost savings increase as changes can be reflected instantly in all the systems that need the segmentation rules. If predictive analytic technology is used to push analytic models into these...

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Analytics & Optimization Writing Better Requirements – Key to Success or false hope?

Aug172005

Some email traffic today made me wonder about "good" requirements. Is improving the quality of requirements always worthwhile? Well, perhaps not. What happens when the requirements change all the time? When competitive pressure or market movements or regulatory requirements change so often that the requirements for a system never really stabilize. In those circumstances it may be a false hope to try and improve the final system by improving the requirements. What is needed, instead, is a way to let those who understand the need for these changes to make the changes themselves. So, rather than invest in ever more detailed requirements, invest in identifying the kinds of things the system must do (rules) and make it possible for the business users of the system to create, modify and delete business rules. This removes the impedance of requirements and coding but could result in an unstable system. Indeed this was brought up in a recent review of Blaze Advisor, Business Rules Meet the Business User , written by Lou Agosta. The solution to this problem lies...

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Customer Engagement Analytics + CRM = Happiness

Aug172005

I saw this article - Analytical CRM gaining gravity globally - today and it reinforced a trend I have noticed before. There is more and more talk about how you can get more value from your CRM investment.  Although this article focused on the value of using Business Intelligence-type analytics on your CRM data and on delivering this insight quickly, there are other ways to get more value. If we take a decision-management approach we can ask "what decisions will be taken where the data our CRM system collected is helpful". Some of these decisions are taken by people, such as identifying a new segment to target with a marketing campaign, and BI technologies are entirely appropriate to enable this. Some, however, are taken by people who have neither the time nor the skill to use BI tools (CSRs or tellers for instance) or even by automated systems (billing system, website, ATM). What you need in these latter cases is an automated decision enhanced with the insight derived from your CRM data. You need to deliver business intelligence on your customers...

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Analytics & Optimization Giving your mainframe a new “brain”

Aug162005

One of the interesting uses of business rules is in the hot topic of legacy modernization. Many organizations have large investments in mainframe applications, written in COBOL or another hard to maintain languages. When these systems are evaluated they typically turn out to be costly to maintain - each change to the system takes time and money out of all proportion to the value of the change. This leads many organizations to replatform and reimplement these systems. However, more careful analysis such as that done by the California DMV can lead to an interesting insight - much of a typical mainframe system is static, works fine and needs no maintenance. Often only a small portion of the system is responsible for much of the maintenance work. DMV found that this was the case with their system - the portion of the system that dealt with managing vehicle information, printing bills etc hardly ever required changes. The part that dealt with license fee calculation, the business rules in other words, required changes whenever the legislature changed the law. If this...

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Analytics & Optimization Business Intelligence Pipeline | IT Detours On the Road To BPM

Aug112005

An interesting article on Business Process Management (BPM) caught my eye this morning - Business Intelligence Pipeline | IT Detours On the Road To BPM. It has a great quote - "Automating your business processes can increase productivity, but it can be counterproductive if the automation takes control away from the process owners". Lori MacVittie is aboslutely correct in pointing this out. I would add one thing to her list of capabilities required to avoid this problem - business rules. She correctly identifies modeling, analysis and simulation as critical, but if one is going to automate a business process to the point where one achieves straight through processing or STP then one needs to automate decision steps within the process. Here too it is essential that you leave control in the hands of the process owners. This requires the use of a serious business rules management system - one that allows the business rules for the decision point to be described, managed and edited by the process owner. Without this the decision points become black boxes...

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