Business Rules 12 th Meeting Course Name: Business Intelligence Year: 2009

Bina Nusantara University 3 (2).Loshin, David (2003). Business Intelligence: The Savvy Manager’s Guide. Chapter 7 Source of this Material

The Business Case Sometimes business rules are applied by a data analyst sitting in front of a database front end, and sometimes rules have been documented as program logic. A business rules system is designed to capture the knowledge of all the assertions, constraints, guidelines, policies, regulations, etc. that drive a business process and manage that knowledge as a corporate asset. What follows are some of the major advantages of implementing business process using a business rules system. Encapsulation of Successful Business Logic Componentized Development Speed of Implementation Ease of Modification and Rapid Response to Change Reuse Persistence of Encapsulation of Business Knowledge Augmented Capabilities Bina Nusantara University 4

The business rules approach takes into consideration the encapsulation of business logic for the purpose of identifying or highlighting entities or events within a system. In essence, a business rules approach is meant to capture and subsequently automate the repetitive operations that have been properly vetted in term of business value so that analyst resources can be engaged in discovering new opportunities for improvement or adding value. A business rules approach integrates the following: Technology Workflow Information Bina Nusantara University 5 The Business Rules Approach

According to the business Rule Group, a business rule is a directive intended to command and influence or guide business behavior, in support of business policy that is formulated in response to an opportunity or threat. From the information system perspective, a business rule is a statement that defines or constrains some aspect of the business. It is intended to assert business structure or to control or influence the behavior of the business. From a practical standpoint, a business rule asserts a statement about the state of a business process or a directive describing changes in the state of a business process. More simply, a business rule dictates what happens when a sequence of inputs is applied to one or more well-described scenarios. Bina Nusantara University 6 What is a Business Rule?

Rule Basics In business system, rules form the programmed representation of business policies and practices. A rule is a statement that assert some truth about the system, along with optional actions to be performed, depending on the assertion’s truth value. Definitions and Specifications In system o rules, there must be a well-defined, agreed-upon “vocabulary” for rule specification; we can then enumerate the participants within the system along with the descriptive “nouns” and “verbs” that are used in describing the business process. Assertions Assertions are statement about entities within the system that express sensible observation about the business. Assertions describe relationships between entities and activities within the framework. Constraints Constraints express unconditional conformance to a business statement; compared to a constraint, a data instance either conforms to that constraint or violates it. Bina Nusantara University 7 What is a Business Rule? (cont…)

Guidelines A guideline expresses a desire about the state of the system or a warning about a potential change in the system. A violation of a guideline may indicate a change in business process that requires attention. Actions An action is any operation that changes the system state, typically as a result of the violation of some constraint or guideline. Triggers A trigger specifies a collection of conditions and the initiation of an action contingent upon the condition’s value. Triggers may combine constraints or guidelines with actions. Inference An inference specifies a collection of conditions establishing a fact that becomes true a by-product of changes within the states of the system. An inference is essentially a new piece of information derived from the system state; when an inference rule is executed, that new piece of information must be integrated into the system state. Bina Nusantara University 8 What is a Business Rule? (cont…)

A business rules system encapsulates sets of environment states, environment variables, and formally defined rules that reflect business policies, preferences, guidelines, triggers, etc. and how the environment is affected based on those rules. A business rules system incorporates the following components. A rule definition framework A persistent rule base A rule engine An execution framework Bina Nusantara University 9 What is a Business Rule System?

Rules Definition All rules-based system employ some kind of rules language as a descriptive formalism for describing all the aspects of the business process, including the system states, the actors, the inputs and events, the triggers, and the transitions between state. A rule language is a framework for describing sets of rules. Rule Engines A rules engine is an application that takes as input a set of rules, creates a framework for executing those rules, and acts as a monitor to a system that must behave in conjunction with those rules. Rules engine work together with a rules languages. Bina Nusantara University 10 What is a Business Rule System? (cont…)

There are many sources for rules, such as conversation with people, design documents, laws, regulations, and program codes, to name a few. Each of these source may be rich in business rules, but because of the peculiarities of each source, the extraction of rules from each requires different skills. People Conversation with SMEs are likely to yield a treasure trove of business rules, especially when these conversations are prompted as a result of previous iterations of analysis. Documentation Documentation is a rich source of business rules, because documentation frequently does not remain synchronized with what is being documented. Descriptive text is rich with rules. Regulations Organizations that are bound by a governing a board’s set of regulations may find that regulations are an excellent source of business rules. Laws and regulations, Bina Nusantara University 11 Source of Business Rules

directives, and even suggestions by governing organizations or industry consortia are good sources for business rules. Program Code One stickier problem in rule discovery is extracting business rules from existing application programs. Alternatively there have been some suggested tools to perform what could be called “code mining”. Turning Language into Rules A major benefit of the business rules approach is that analyzing a business process, provides a mechanism for extracting BI from program logic and allowing it to be treated as content. The rule analysis process leads toward the ability not just to isolate intelligence rules, but also to identify terms, facts, and assertions about the business entities that typically modeled in a database. The Value of Subject Matter Experts Having business-savvy staff or SMEs on the team will ease that process. Bina Nusantara University 12 Source of Business Rules (cont…)

Management Issue When deciding to develop a system using the business rules approach, consider what the system should look like after it is built, and enumerate all the rules that specify our expectations about how that system works. These expectations are the seeds of our business rules. Political Issues Similar to other components of a BI program, a big roadblock to a successful business rule implementation is a social issue, not technical one, for a number of reasons.  Risk Assessment  Turf Concern  High Expectations Limitations of The Approach There are of course limitations to the use of business rules.  Detail Management  Inflated Expectations  Programmers are not eliminated Bina Nusantara University 13

End of Slide Bina Nusantara University 14