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Decision Management and Government

Although most people talking about decision management, business rules or predictive analytics are talking about their value to businesses, government agencies too can benefit enormously. Many agencies are adopting business rules for compliance and eligibility systems while predictve analytics and broader decision management are becoming popular too.

A number of government agencies have started to use business rules for automating decisions such as licensing, fees, compliance or eligibility. One great example is the California Department of Motor Vehicles, recently profiled in Intelligent Enterprise - New Rules, Agile Government. DMV used business rules to replace the core decision making component of an old legacy system that took many programming hours to make each change with one where changes can be made quickly and easily. Having thus renovated their mainframe system they were then able to re-use the rules to power a web application that allows California residents to estimate their license fees - check out The Vehicle Registration Fee Calculator. The renovation had a great ROI and the web application was an additional benefit. Many agencies have this kind of problem and could get this kind of return.

Predictive analytics are less common in government. I covered some potential uses of predictive analytics in government in a couple of recent papers for Montgomery Research - Analytics for Tax Collection: From Predictive Models to Optimization and Applying Advanced Decision Technology to Tax Collection. The use of analytics in tax collection allows agencies to focus their collections resources more tightly based both on how likely someone is to pay as well as how much they owe. Audit resources can also be more carefully deployed if predictive models of who is likely to have mistated their tax are used as well as more random methods. The potential return on this kind of analysis is great as most agencies do not have the resources to target all scofflaws. Clearly there are privacy and fairness issues but well designed models allow these to be addressed.

Government agencies, like companies, can get an ROI from business rules as well as increased agility and reduced ongoing costs while providing better service to citizens. Analytics can help them use scarce resources more effectively. Decision Management is not just for corporations.

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