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April 15, 2012

Three Simple Rules for Titanic Fans

In 1492 Columbus sailed the ocean blue.  Every little child knows that three ships set sail to discover the New World. But did you know that only two ships survived the return trip?

The Santa Maria ran aground off the coast of Haiti on Dec. 25, 1492 and was destroyed. Columbus learned his lesson and the Sailing Rulebook was born.

420 years later Titanic sailed into an iceberg and the rulebook grew. 

100 years later Costa Concordia and Captain Schettino forgot Rules 1 and 2.

Titanic Rulebook

http://10simplerules.com

 

 

 

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May 07, 2010

Terrorists are Coming To Town

Terrorists are coming to town.

 

We better watch out
We all might die
Stay home don't go out
I'm telling you why

Terrorists are coming to town.

 

TSA's making a list,
Airlines aren't checking it twice;
We'll never find out Who's naughty or nice.
Terrorists are coming to town.

 

Wall Street's closed when you're sleeping
Drops 1,000 points when you're awake;
Some rule fool trades 16 billion shares
instead of 16 million.
So be good for Goldman's Sake!

 

Rule Fools are running Wall Street.
Rule Fools are running this town.

 

No more need to worry
Cause Rules are coming to town.
Cause Principles are coming to town.

 

O! We better watch out!

BP is gonna try,
To stop the 5,000 feet underwater oil spout

By giving a containment dome a try.

 

I know their Experts have
The Knowledge to fix it.
One day we'll know

Why the Blowout Preventer blew it.

 

Rule Fools are running Wall Street.
Rule Fools are running this town.

Terrorists are coming to town.

Terrorists are coming to town.

 

BP Oil Containment Dome   Blowout Preventer (US OSHA)

 


© Rolando Hernandez 

Please use Twitter hashtag #RULEFOOL for this post
Follow me on Twitter username @BizRulesInc

 

Check out Ten Rules for Restoring Trust in Wall Street, BP, TSA, Airlines... and anyone else who wants to do business in this town!

 

September 17, 2009

Business rules drag Orbitz down to Earth

Orbitz just lost its cool.

I just booked a roundtrip flight from Dallas to Atlanta. The outbound flight is at 5:30AM CDT. The return flight is at 4:05PM EDT. Each flight is about two and a half hours long.

But according the Orbitz' email confirmation:

  1. This is an overnight flight.
  2. This flight arrives two days later.
  3. This flight arrives on the previous day.
  4. This flight arrives two days prior.
  5. This flight departs from a different airport.
  6. This trip starts and ends at different airports.  (see the rest of the email text below)

WOW! There is just way too much information here to absorb. I need to take this one step at a time so it can really soak in.

First, "this is an overnight flight." Do you know if you have to pay for pillows and blankets nowadays?

Second, "this flight arrives two days later." Apollo 11 took four days to get to the moon. (July 16-19, 1969)

Third, "this flight arrives on the previous day." Now that I can believe! Believe it or not, that would be the second time this ever happened to me. Once I flew out of Tokyo at night on my birthday. I arrived in Hawaii in the morning, on my birthday. The International Date Line is cool that way. (see http://bizrules.com/resumes/rh_mobil_story.htm

Fourth, "this flight arrives two days prior." Back to the Future. Sounds like a good time to buy some stocks before takeoff.

Next, "this flight departs from a different airport." I hope they have a fast shuttle bus.

Finally, this trip starts and ends at different airports. I guess that message is OK. The main reason I booked this trip is to get from one city to another. So this message is technically correct. I've never seen this message before in Orbitz email confirmations, so this could be a new system enhancement to improve customer service: it's good to let customers know that they will land in a different place than where they took off from. That's all good. So that's not really a bug. It's more like a feature.

This automated email has 5 or 6 mistakes, depending on whether you think #6 is a bug or a feature. Actually 10 or 12 mistakes, because the messages were listed for each flight. That's not good.

Orbitz has a business rule problem. Somewhere in the system, rules are missing or they are just plane wrong. Orbitz needs to improve their business rules management system. Orbitz needs to figure out what their business rules are and what they should be. They need rules that are correct, complete, compliant, consistent, clear, and concise.

That's what Orbitz needs. And what Orbitz customers deserve.

Rolando Hernandez, CEO, www.BizRules.com


NOTE: Below is an excerpt of the Orbitz email

=================================================
Your Travel Document

Hello ROLANDO,

Thanks for traveling with Orbitz. This e-mail confirms the ticket number(s) issued for the "Atlanta <DepartureDate>" trip.

<DepartureDate>
Delta Air Lines # 1912
 
Dallas/Fort Worth International (DFW) to Atlanta Hartsfield-Jackson ATL (ATL)
Departure (DFW): <DepartureDate>, 5:30 AM CDT (morning)
Arrival (ATL): <DepartureDate>, 8:48 AM EDT (morning)

 This is an overnight flight.

 This flight arrives two days later.

 This flight arrives on the previous day.

 This flight arrives two days prior.

 This flight departs from a different airport.

 This trip starts and ends at different airports.

<ReturnDate>
Delta Air Lines # 67
 
Atlanta Hartsfield-Jackson ATL (ATL) to Dallas/Fort Worth International (DFW)
Departure (ATL): <ReturnDate>, 4:05 PM EDT (afternoon)
Arrival (DFW): <ReturnDate>, 5:34 PM CDT (evening)

 This is an overnight flight.

 This flight arrives two days later.

 This flight arrives on the previous day.

 This flight arrives two days prior.

 This flight departs from a different airport.

 This trip starts and ends at different airports.
=================================================

Update 1: An Orbitz customer service rep said this was due to Delta merging with Northwest. The inventory data from Delta is messed up she said. I wonder how many people received these warnings and error messages.

Update 2: A good place to go for more information on business rules management and rulebase techology is www.rulesfest.org

 

September 25, 2008

Ten Rules for Wall Street

Ten Rules for Wall Street

What are the rules? Did people break the rules, bend the rules, or ignore the rules?

Confidence in Wall Street went down the drain last week. The credit crisis gave business a bad name, and it gave government a bad name for not doing anything about it. Trust disappeared. 

It's time to rebuild trust in business and government.

Here are ten rules for restoring trust in business and government. These rules apply to everything from the global financial system, to Wall Street; from federal governments to local jurisdictions; from global corporations, to organizations and small businesses.

Companies that learn to define transparent rules that are sensible, consistent, easy to understand, and easy to follow will be easy trust. On the other hand, companies that rely on opaque rules that are complicated, confusing, illogical, inconsistent, or deceptive will be hard to trust. They will go out of business.

Rule 10 - Have guiding principles. Act on principles, independent of influence by greed or friends.

Rule 9 - Follow policies and guidelines about what is permissible and what will not be tolerated.

Rule 8 - Establish rules of behavior concerning what is right and wrong. Success in business depends on understanding the rules. The rules of the business are the way the business really operates. Design transparent rules that are logical, sensible, easy to understand, and easy to follow.

Rule 7 - Leverage knowledge and judgment. Know what you know, and know what you don't know. Document and retain what your experts know and how they think so their knowledge can be shared with those who need to know. Use wise judgment. Know when to follow the rules, when to bend them, and when to forget them.

Rule 6 - Make smart decisions informed by facts, rules, knowledge, principles, and judgment. Decide using clear, logical, and unbiased rules that explain each decision clearly. Use sound reasoning to make rules-based, principles-based, and knowledge-based decisions.

Rule 5 - Create enterprise architecture to deal with change and complexity. Use architecture to simplify complexity, and to understand how the whole business and the whole system works; Understand who, what, when, where, why, and how. Design the architecture to ensure that all the parts fit (interoperability), connect (integration), work (quality), work as intended (alignment), last (reliability), and can be shared (reusability). Design the architecture so the business can handle increases in complexity and increases in the rate of change (flexibility). Design the architecture to reduce time-to-market and reduce operating costs. Design the architecture to support rules-based and principles-based compliance.

Rule 4 - Do the engineering, to design systems that work, change, and last. Apply architecture and engineering design principles to ensure alignment, flexibility, quality, interoperability, integration, reusability, reliability, compliance, reduced time-to-market, and reduced costs. Build in risk management safety factors so the business and the systems can handle extreme stresses and excessive loads.

Rule 3 - Have a clear vision. Stand for brand.

Rule 2 - Instill confidence. Improve the quality, consistency, and accuracy of decisions and actions.

Rule 1 - Build trust. Align actions, decisions, and transactions with management's intentions. Align execution to goals, strategy, and mission. Align systems to business. Align implementation to intention.

Sept. 25, 2008   Rolando Hernandez   BIZRULES

Principles are Coming

Principles are Coming

More judgment and knowledge needed

While the finance industry is moving toward more rules and exceptions, and rules-based regulation, financial accounting and reporting is moving in the opposite direction, towards fewer rules and exceptions. Accounting and tax is moving towards more principles-based regulation.

The US is moving away from GAAP (Generally Accepted Accounting Principles) and towards IFRS (International Financial Reporting Standards). IFRS is the reporting framework used by most of the world today, and it has growing support in the US. IFRS relies on professional judgment rather than detailed rules. Under this principle-based approach, management will have a mandate and obligation to exercise its own best judgment when making decisions.

Companies will need to implement systems that use knowledge and judgment to make principle-based decisions.

It is time to adopt knowledgebase technology and knowledge management. It's time to build knowledge bases and embed knowledgebased technology into operations and existing systems.

Knowledgebased systems that are engineered and architected properly can

  • follow principles and guidelines
  • automate management's best judgment
  • ensure compliance
  • and deliver trust. These expert systems can be trusted because they use expert judgment to make the same decisions top experts would make, thus improving the quality, accuracy, and consistency of decision-making.

I don't believe there is any other practical or proven way of automating human judgment, other than building intelligent, knowledge-based systems.

Knowledgebased systems are the solution for principle-based compliance.

Rules are Coming

Rules are Coming 

More rules and regulations are coming

To restore trust in the financial system, the government is moving towards more rules and exceptions, and more rules-based regulation. The trend towards de-regulation is over. Regulatory reform is coming back. That means more rules and regulations than ever before.
 
Management will have an obligation to follow the rules and laws when making decisions. These decisions better be consistent, correct, complete, and compliant if you really want to stay in business. 

Companies will need to implement systems that follow the rules and make rule-based decisions.

It's time to adopt the business rules approach and business rules management. It's time to build rulebases and embed rulebase technology into operations and existing systems.

Rulebased systems that are engineered and architected properly:

  • follow the rules
  • automate management's decisions
  • ensure compliance
  • and deliver trust. Rule engines can be trusted because they implement the decisions management intended.

Rulebased systems and business rules management are the solution for rule-based-compliance.

July 28, 2008

IBM sets the course and ILOG steers the Ship

IBM is one of the few companies that sets the course in technology. Now they will use ILOG to steer the ship.

IBM has announced their intention to buy ILOG for $340 million USD. ILOG is widely recognized as one of the leading BRMS software vendors.

This move helps legitimize business rules management systems (BRMS) and rule engine technology. This will shake up the playing field in the BRMS/BRE space as ILOG BRMS competitors aligned with and partnered with IBM will need to rethink their strategy and technology.

Integrating ILOG BRMS with IBM's BPM and SOA technologies will also raise the bar in the BPM/BRMS space. Pegasystems has been a leader in the BPM/BRMS space, which Pega basically invented, ever since they released their PRPC PegaRULES Process Commmander product. BPM vendors lacking BRE capabilities are going to have to start OEMing a BRE tool, building one, or buying one like IBM did.

This move also speeds up the BRMS market consolidation that has been picking up steam in recent years. Last year SAP acquired the Yasu rule engine, and Ruleburst (previously SoftLaw) acquired Haley Rules. Prior to that, of course, Fair Isaac acquired RulesPower, and Trilogy bought Versata then Gensym. Going further back, CA bought Platinum Technology (which had acquired AION and the AION BRE). AION, of course, was started by a bunch of ex-IBMers, who wanted to improve on IBM's TIRS (The Integrated Reasoning Solution) mainframe rule engine, who left IBM to develop the AION rule engine. After TIRS, IBM began working on Common Rules. That IBM rule technology and research effort could be combined with ILOG's BRMS tool in the future.

IBM also plans to embed ILOG rules technology across its broad product offerings, further strengthening their products and further legitimizing rules technology.

The business rules market is alive and well. The tools are getting better. The vendors are getting larger. The methodologies are getting easier. As rules-based tools become more widely adopted, companies will be able to spend more time designing quality rules and managing effective rules, and less time worrying about the rule engine technology under the hood.

Companies that resisted rules technologies and methodologies in the past almost missed the boat. Now they have another chance to get on board the rules express.  IBM is ready to rule again.

See also:

 

 

May 22, 2008

2008 October Rules Fest in Dallas, TX

October Rules Fest, the conference on rulebased and and knowledgebased systems, will be held in Dallas, TX on October 22-24, 2008. ORF is bringing together for the first time in one place the inventors and originators of key rules technologies and methodologies such as:

  • Dr. Charles Forgy, inventor of the Rete algorithm that drives many of today's leading Business Rule Engines such as ILOG, Fair Isaac, and Haley
  • Dr. Dan Levine, noted AI/Neural Net scientist
  • Daniel Selman, software architect and ILOG JRules Rule Studio team lead
  • Edson Tirelli, Drools/Red Hat
  • Gary Riley, co-author of CLIPS (where Inference/MindBox and Haley Rules originated)
  • Greg Barton, Infinimeme
  • James Owen, KBSC, rules consultant, noted author, and visionary
  • Larry Terrill, EBDX.com
  • Mark Proctor, co-author of Drools
  • Michael Neale, Drools/Red Hat
  • Dr. Richard Hicks, noted Validaton and Verification sicentist, creator of EZ Xpert, Texas A&M Univesity
  • Rolando Hernandez, Chief Rules Architect, BIZRULES and creator of the VISION business rules methodology 

The seminars and presentations will be ideal for both CTOs, technical architects with rules experience, and developers new to business rules development. There will also be tutorials and introductions to business rules architecture, technologies, and methodologies for CIOs, managers, and analysts who want to learn why knowledge and rules matter.

Dallas Rules Group is a new business rules user group formed in January 2008 by folks interested in business rules architecture and development, knowledge acquisition, knowledge representation, knowledge engineering, AI (artifiical intelligence), expert systems, and enterprise rules integration.

This will be a technical seminar for technical people.  For those interested in the business side of rules, join some of our distinguished speakers the following week in Orlando, FL at the 11th International Business Rules Forum.

 

March 13, 2008

Introducing the BIZRULES® RuleMap™

Documenting business rules is a good first step on the path towards the business rules approach.

But sometimes that's not enough.  Taking the next step and getting to the next level requires simulating business rules so they are easy to review and verify.

Over the past few months BIZRULES has been working on a new product that lets us do both. It's a visual tool that lets us not only draw diagrams of business rule models, it also lets us simulate the rule logic. This tool helps us speed up the rules harvesting process and improves the quality of our rulebooks.

BIZRULES® RuleMap™ is an interactive rulebook that models business rules and simulates business logic.  This logical model lets you see how your business rules really work. It lets you visualize the Reasoning Chain™ that leads to smart conclusions and right decisions.


We use this tool to document your business rules independent of any BRE - yet it can be implemented using any BRE. Again, this is a logical model of your business rules.  It can be used as the rulebook or specs for authoring the rules in any BRE.

Take a look at a sample RuleMap. And let us know what you think. Contact us for pricing or a web demo.

 

 

July 12, 2007

Interview with Fair Isaac VP James Taylor on EDM and Smart (enough) Systems

Say hello to Enterprise Decision Management, or EDM for short. EDM is the new buzzword that business rules folks are buzzing about lately.

It sounds like it was dreamed up by marketers to put a new spin on something that great companies have been doing all along, albeit probably manually. In fact, it’s a great acronym invented by James Taylor, Vice President of Enterprise Decision Management at Fair Isaac, to describe what their customers were essentially doing with Fair Isaac’s Blaze Advisor rule engine: Building smart rule-based systems to manage and automate decisions.

It turns out that all sorts of companies are using business rule engines to build EDM applications. James just figured this out first and gave it a great name. By now many of the leading BRE vendors are probably updating their marketing materials with the EDM buzzword.

(shameless plug – I just added EDM to the BIZRULES website in the decisioning solutions page.)

James just published a new book, along with co-author Neil Raden, about EDM and their ideas for building smarter systems. I had an opportunity to chat with James recently and interview him about his new book called, appropriately enough, Smart (enough) Systems. (see http://www.smartenoughsystems.com/wp/main

BIZRULES: Tell us about your new book, Smart (enough) Systems 

Taylor: The book is being published by Prentice Hall Professional, and it describes how companies can use the computer-based systems they have in place rather than purchasing new ones to build smarter systems - and how these systems can help companies thrive through Enterprise Decision Management.  

Continue reading "Interview with Fair Isaac VP James Taylor on EDM and Smart (enough) Systems" »

March 16, 2007

Best Buy, Bogus Prices: Confusion about pricing rules reveals need for business rules management

If employees don’t know, don’t understand, or don’t care what the rules are, you have a business rules problem.

If customers get different answers depending on who they talk to, you have a business rules problem.

If salespeople can decide whether to charge the right price or a bogus price, you have a business rules problem.

Best Buy, the nation's largest electronics retailer, has a business rules problem.

It's also dealing with a public relations nightmare, and an investigation by the Connecticut Attorney General's Office.

Pricing rules used by salespeople in Best Buy stores are inconsistent and contrary to Best Buy pricing policies established in the boardroom. “What we've learned very quickly is we have not been clear enough in communicating to our employees the policy, and how to execute it in our stores,” said Dawn Bryant, spokeswoman for Best Buy.

Success in the world of business depends on understanding the rules,” I said recently during a panel discussion on Sarbanes-Oxley compliance.

“You need to know the internal rules and policies of your business. You have to comply with the external rules and regulations that govern your business, industry, and function. Your company must ensure that rules are followed. Your company must enforce the rules. Your company must give staff tools to help them follow the rules, make legal decisions, and prevent them from making illegal decisions. Business rule management systems (BRMS) and business rule engines (BRE) help companies comply with rules and regulations like SOX.

If you don’t have a rule engine that automatically prevents employees from breaking the rules and instantly detects and prevents fraud, you’re out of the game. You’ll end up watching your stock go from $30 to $3 during lunch. You lose. You’re out of business.

Smart companies are using business rules to ensure compliance with rules, to enforce rules, to increase agility so they can change faster, to prevent business mistakes, and to reduce IT system development costs by changing rules in days not months.

Business rules technology helps business comply with rules and regulations, helps employees follow the rules, and prevents employees from breaking the rules (either accidentally or on purpose).”

Business rules management is the prescription for business rules problems. Business rules management entails everything from the business rules approach to business rules technology. 

The business rules approach helps companies transform complex policies into easy to understand business rules. What better way is there to clearly describe and communicate policies and business rules to employees?

Business rules technology helps companies execute the right business rules at the right time every time. What better technology is there to automate business rules?

What happened at Best Buy is a great example of what can go wrong when business rules are not designed and engineered properly.

Business rules are like the glue that holds together all the parts of the corporation. Business rules integrate and align all the moving parts of the corporation. With business rules management, Best Buy can ensure that rules and processes used in the stores are aligned with Best Buy pricing policies defined in the boardroom.

Without business rules management to connect the elements of the corporation, the only way to ensure the corporation works as intended is to "hope and pray," as John Zachman likes to say. With weak or wrong business rules, the corporation falls down like a house of cards.

This is why business rules management is vital to the corporation.

Business rules management is not just about documenting business rules, defining who the owners are, and deciding who is authorized to change them. It’s not just about using rule-based languages to speed up system development instead of hard-wiring rules in legacy code. It’s not just about selecting a business rules engine. It’s not just about understanding the company’s strategies, policies and business practices, and then transforming those objectives into rulebooks, descriptive business rule models, IT specifications, and finally into automated systems.

Business rules management is also concerned with architecting and engineering the business rules so they are integrated with the rest of the business. This helps ensure that the implemented business rules that are in actual use, whether automated or manual, align with the governing rules and strategies of the business.

What happened at Best Buy?

At first, I thought the Best Buy pricing problem was complicated and hard to explain. Then I wondered how can business rules help solve this problem? What would BIZRULES do if Best Buy came to us for help?

That’s easy. I like to draw pictures to simplify complex ideas. By removing the complexity, pictures help me make even the most complex concepts easy to understand:

BIZRULES Analysis of Best Buy Pricing Rules 

(Click to see medium or large slide)

This is an example of three business rules that were apparently in operation at Best Buy when this story broke. Of course, we really don't know the rules were, so this is just a good guess based on published news accounts of what really happened.

Along with a picture of the rules, this slide shows how the rules affect the rest of the company. It also shows how the rules satisfy business rules management objectives, and business rule engineering design objectives:

Rule #1 is a conceptual explanation of the pricing policy to honor the lowest price.

  • This rule tells us what management means and what their intentions are.

Rule #2 is a logical description of the corporate policy to honor the lowest price:

  • This business rule clearly shows alignment to corporate strategy.

  • This is the high quality rule prescribed by the pricing strategy.

  • This rule shows integration between online and retail stores.

  • This rule offers reusability – the same rule can be implemented online and in the store.

  • This rule shows transparency.

  • This rule reduces operations costs because it’s easy to follow.

  • This rule demonstrates regulatory compliance.

  • This picture is worth a thousand words.

  • This rule builds Customer Trust Management.

  • This is a “Best Buy” type of rule.

  • This rule is easy to approve, assess, test, and certify.

  • This rule improves governance and controllership.

Rule #3 is used (i.e. prescribed) by some salesman to mislead customers into paying higher prices:

  • This business rule is clearly not aligned to corporate strategy.

  • This poor quality rule is operational and being used in stores.

  • This rule shows discontinuity and inconsistency between online and retail stores.

  • This store rule cannot be reused online because it lacks transparency.

  • This rule increases operations costs because it’s hard to explain and justify.

  • This rule raises questions about regulatory compliance.

  • You need a thousand words to explain this picture.

  • This rule destroys customer confidence and trust.

  • This rule is public relations nightmare.

  • This rule may be illegal.

  • This is a “bait & switch” type of rule.

  • This rule should never have been approved.

  • This rule raises questions about whether proper rules, processes, and controls are in place.


Now that I understand what the current pricing situation at Best Buy is, it seems pretty straightforward:

  • Management intention is Rule #1. This is Best Buy’s pricing policy.
  • Marketing description is Rule #2. This is what marketing thinks is happening.
  • Sales prescription is Rule #3. This is what salespeople are actually doing.
  • IT specification is not applicable in this example because these rules have not been automated. If these rules were automated, an executable specification of the rule (i.e. pseudo code) may need to be developed for the programmer.


These four views of the business rules fit nicely into an Enterprise Rules Architecture.

The next step is to fit these rules into an enterprise architecture framework. I used John Zachman’s influential and compelling Framework for Enterprise Architecture as an example:

The Zachman Framework for Enterprise Architecture

(Click to see medium or large slide)

Next, I overlaid Best Buy Rules #1-3 on top of Zachman’s Enterprise Architecture Framework to add more clarity to the Best Buy pricing situation:

BIZRULES Analysis of Best Buy Pricing Rules (part 2)

 (Click to see medium or large slide)

The pricing problem at Best Buy is that the business rule used by salespeople in the stores contradicts the company’s pricing policy. Clearly Rule #3 is not aligned with Rule #1 or Rule #2.
Business rules confusion is what caused the problem.

Business rules management is the solution.

To get out of this sticky mess, Best Buy needs to:
  • establish or improve their business rules management.
  • prevent salespeople from using Rule #3 immediately
  • mandate use of Rule #2 immediately.
  • automate Rule #2 as soon as possible. Why let salespeople decide pricing at all? Let the computer figure out what the lowest price is.
  • use a business rule engine to automate this rule as quickly as possible. This rule change needs to happen overnight. But changing hard-wired rules in code takes take days or weeks. Often, companies that don’t use rule engines take months to change business rules as simple as these. This is one reason why companies buy rule engines: Changing rules in a rule engine takes minutes.
  • educate salespeople on the pricing rules. Of course, if Best Buy automated the rules using a rule engine, they wouldn’t need to train as much.
  • ensure compliance with these rules from now on.
What about the secret website?

Business rules can also help Best Buy get rid of the secret and duplicate website. It's hard enough to maintain and manage prices for thousands of products on one website, let alone two. There are costs associated with maintaining a duplicate site containing 250,000 pages; surely management and shareholders want to reduce redundant costs like these. One way is to use a business rule engine to eliminate the duplicate site and duplicate effort. Why not write a few rules to show different prices (if that really is management’s objective) depending on whether the salesman pulls up the web pages on the Internet or the "secret website" on the Intranet?

How else can business rules management and business rules technology help Best Buy? Please comment and let me know.

Rolando Hernandez

CEO & Chief Rules Architect, BIZRULES

 

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Best Buy + Secret Website = State Investigation of Best Buy Sales Rules

Best Buy uses a “secret website” in their stores to mislead customers and deny them discounts advertised on BestBuy.com  

On February 9, 2007 George Gombossy, Staff Writer/Consumer Watchdog reporter for The Hartford Courant, wrote this article on how Best Buy salesmen in the West Hartford, CT, and  Newington, CT, stores refused to honor $150 discounts offered on a Toshiba laptop advertised on Best Buy's public website - bestbuy.com.

The salesmen justified their refusal by showing the customer a secret website that appeared to be BestBuy.com. This secret website that they accessed in the store did not have the sales price.

Best Buy spokesman Justin Barber called the reporter back and said Best Buy's policy is to always honor the lowest advertised price, whether from its Internet site or from a competitor.  Barber insisted that "nothing improper was going on and that there was no secret website that virtually duplicates the public site so salesmen can dupe customers."

On February 10, 2007 the Connecticut Attorney General's office started an investigation into whether Best Buy maintains a secret intranet site that may have been used by some salesmen to deny customers discounts that appear on the company's public Internet site. The AG's office office informed Best Buy that he wants answers about its Internet policies and to disclose whether it has an intranet site that could be used to mislead customers. His office will also look into whether other chain stores may be using similar sales practices.

"The key question is whether consumers were advertised one price, and then denied that price when they got to the store," Connecticut Attorney General Richard Blumenthal said last week.  Under pressure from state investigators, Best Buy later confirmed that its stores indeed do have a "secret intranet site that has been used to block some consumers from getting cheaper prices advertised on BestBuy.com."

What happened at Best Buy is a great example of what can go wrong when business rules and processes are not managed properly. At a minimum, this is clearly an example of poor business rules management practices and poor process management practices. At a maximum, executives, employees and the company could be liable for damages.

This situation shows why business rules management is vital to the corporation.

See: Best Buy, Bogus Prices: Confusion about pricing rules reveals need for business rules management

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Continue reading "Best Buy + Secret Website = State Investigation of Best Buy Sales Rules" »

March 14, 2007

Enterprise Rules Architecture

In case you are new to business rules, I’d like to go over a few basic terms and facts about business rules and enterprise architecture. Understanding terms and facts is one of the first steps in the business rules approach.

The purpose of the corporation is to perform a business function. The function of most corporations is to make a profit for shareholders by selling products and or services. Corporations comply with external rules, laws, and regulations that specify what the corporation can, should, must, and must not do. They calculate and pay tax, and they report information and file submissions with government agencies.

Corporations establish missions, goals, and strategies such as “sell more and increase profit.” They define internal business rules, policies, procedures, processes, and flows to support the strategies while assuring regulatory and statutory compliance. They put in place business rules to guide macro and micro decision-making and help management plan, manage and improve the operation.

Corporations open stores and branch offices in places and jurisdictions that they would like to do business in, and where customers can go to shop, buy, and transact. They hire employees and educate them on the goals and processes, and train them on the rules.

Corporations design, build, use, and manage information systems, business systems, and database systems for managing, transacting, reporting, decisioning, advising, and automating business functions. These systems have a business purpose, function, structure, behavior, and logic.

All these elements that make up the corporation can be represented by an enterprise architecture framework.

One influential and compelling concept of enterprise architecture was defined in the 1970s by John Zachman when he described his Framework for Enterprise Architecture. The Zachman Framework (click to see it small, medium, or large) consists of descriptive models that describe all the elements of the corporation and the business models of the corporation.

The elements of the corporation include shareholders, employees, and customers (who); data, information, and systems (what); events, plans, schedules, and flows (when); locations, stores, offices, domain names, and networks (where); processes, programs, and code (how); and goals, strategies, policies, and business rules (why).

The business models (i.e. views or perspectives) of the corporation are contextual scope (planner view); conceptual business model (owner); logical system model (designer); technology model (builder); and detailed specifications (sub-contractor).

Business rules integrate and align all the elements and business models of the corporation. Enterprise rules architecture ensures that the functional and structural components of the business rules required for the corporation to fulfill its business function will work, change, and last.

Business rules management entails the business rules approach, business rule methodologies, best practices, rule harvesting, rule modeling, business rule engineering design objectives, enterprise architecture, enterprise rules architecture, rulebase architecture, terms glossaries, semantic modeling, business rule engines (BRE) and business rules management systems (BRMS).

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New Power for Management: Business Rules

Understanding and managing business rules is vital to the corporation. It is just as important as managing people, processes, and information.

Nevertheless, business rules are often misunderstood and poorly managed.

Many rules remain unwritten – they are known only to and retained by subject matter experts who sooner or later leave the corporation, causing brain drain. When business rules are written, they are seldom shared and reused throughout the corporation, which increases operating costs. When business rules are automated, they may not be aligned to the business strategies and policies, leading to quality problems.

In order to program business rules, programmers often rely on unclear business rule specifications that are incomplete or incorrect. Then they usually hard-wire the business rules in computer languages that only programmers can understand and change.

Because programmers are not directly involved in the day-to-day operation of the business, they often make assumptions about what the rules are and what management intended. That leads to mistakes or bugs in the programs, which requires further programming and re-programming.

There is a solution.

Some corporations use advanced business rules technology and business rule management methods to take business rules out of IT and bring them back into the business. Now management can finally manage and change their business rules.

Business rules management techniques help management clearly describe and communicate business rules to employees, partners, and customers. Business rule management software helps automate the rules that should be rule-based.

Business rules improve the condition of the corporation. They prevent business mistakes and minimize risk. They solve many critical problems facing business and IT.

Business rules are like the glue that holds together all the parts of the corporation, ensuring that the automated rules align with goals and strategies.

Business rules integrate and align all the moving parts of the corporation into a cohesive enterprise architecture and operating system that works, changes, and lasts.

Business rules give new power to management.

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October 13, 2006

Article: Business in Balance - Where Rules Management and BPM Meet

Rules are in the news! It's great to see a cover story in Intelligent Enterprise magazine on BRE and BPM.

Here's a link to an interesting article by Bruce Silver: "Business in Balance - Where Rules Management and BPM Meet; Both rules engines and process management suites are vital to business agility and performance. Here's how to strike the right mix of techniques and score a perfect 10."

Also posted in the Articles section of the Business Rules Knowledge Base.

March 28, 2006

Six Myths of Rules and Business Process Management

Here's an interesting article about rules management and business process management that is right on the money:

"...what really matters are what the business owner has asked for: compliance, growth and productivity. The shortest path to these goals is through end-to-end automation of business processes that have at their core procedural flows and declarative business rules...

...Business rules are not an afterthought for successful BPM; rather, they are an essential component of it..."

See Six Myths of Rules and Business Process Management, By Dr. Setrag Khoshafian, VP of BPM Technology, Pegasystems

June 10, 2005

What's wrong with Business Rule Engines and Expert Systems?

One of the biggest obstacles we face in the Business Rule Management industry is that rule engine/expert system software tools are "that good".

  • Some companies just can't believe all the "claims" that we (the BR software vendors and BR consulting firms) make, so they go away and don't buy. They think our "claims" are "hype".

  • Some companies do believe all the claims and immediately see the power and value that Business Rule Engines and Expert Systems can add. Then the IT side realizes that "business people writing rules" really means "IT people don't have to". So all too often some IT People raise technology issues and concerns such as Top 10 Reasons Why We Should Not Manage Business Rules or use Business Rule Engines that slow down or derail the whole effort.

  • Some companies that have figured out how to "do rules right" and really leverage BRE/ES technology get so much value out of it that they just don't want to talk about it. Some clients don't want to stake a "claim" - - they prefer to stay under the radar and keep firing away (no pun intended) at their competition. If you had a secret competitive edge, would you tell your competition? (See: "Expert systems didn't really go away. They went undercover.")

So even though there are lots of BRE software vendors and a few visionary niche methodology/consulting vendors that Gartner calls "Satellite Methodology Vendors" like BIZRULES.COM (shameless plug!), one of the challenges we face is that our solutions and technologies are "so good" that clients won't tell, and potential clients won't believe.

For 20 years, people in this industry have been trying to solve this problem. I wish I knew the answer.

Top 10 Reasons Why We Should Not Manage Business Rules or use Business Rule Engines

Here is a list of what I call "the usual suspects" - - These are the quotes that you will hear many IT People say when someone proposes the idea of using a rule engine instead of hard-coding or hard-wiring rules.

The Proposer sees the rule engine as a way to increase IT productivity, improve time to market, and reduce IT costs.

The "Old IT" People see the rule engine as a threat because it means they won't have to write as much code. Less code to write means less money to make.

The "New IT" People see the rule engine as an opportunity because it means they won't have to write as much code. This will give them more time to do more higher value-added work.

So listen up next time someone suggests using a rule engine in your company: See if you can tell from the response and feedback who gets the "New IT" of the 21st Century, and who is still stuck in the "Old IT" of the 20th Century?

10. "This is different." - - I agree, yes, traditional procedural applications are quite different from declarative rule-based applications

9. "This is not how we build traditional procedural-IT systems around here."

8. "This is not the way we hard-code or "hard-wire" our rules in our systems."

7. "If we use a rule engine, we may not need as many IT business analysts." - - This is a fact. Subject Matter Experts and other Business People may indeed be able to author the rules themselves, without IT Business Analysts

6. "And if we really learn how use this rule engine well, we may not need as many IT Programmers either..." - - This is a fact

7. It's not object oriented." - - This is wrong on multiple levels. First of all, object oriented programming systems evolved from A.I. and expert systems research labs. The earliest inference engines and expert systems were actually among the first (if not the first) computer programs that were truly object oriented. Remember SmallTalk?

6. "The inference engine will be too slow." - - This is wrong. This statement may be made by somebody who has experience working on expert system projects back in 1985. Everything was slow back then. Inferencing is a lot like thinking - It's hard work! Remember, PC's were running at 10 or 20 MHz back then. Inference engines run fine on my 3 GHZ PC in 2005.

5. "It'll never work." - - Some people just don't get it. They cannot deal with change. Lots of very smart people say things like that, and they turn out to be dead wrong. See Famous Quotes

4. "We tried that years ago, but it was too slow." - - See #6

3. "This rule engine adds one more layer for our programs to deal with." - - Technically, you may be right. However, did you stop to consider how many layers of legacy rule code you will be able to get rid of once the way you throw out all the spaghetti-code rules logic and put the rules in a rulebase (aka rule engine) instead? Getting rid of all that "hard-wiring" is probably going to eliminate about 23.5 layers of junk. So, yes, I agree with you on this one: Using the rule engine will add "one more layer". Let's call it the "business logic layer" or the "knowledge layer"

2. "Our rules are too complex for a rule engine." - - Every time I hear this claim, my jaw drops, then I go speechless. After a few seconds, I will explain the fact that the more complex your business rules are, the more you need a rule engine. This is usually the right moment to bring up the RETE algorithm and discuss how it scales and handles more rules without degrading.

1. "We'll just write our own rule engine." - - This is usually the last gasp. Once all the claims above are debated and proven false, this is the one that seems to come up last. At this point, even the IT People realize the way to go is a rule engine. But the first thought is "He's right, we need one... We need a rule engine... We need to build a rule engine." Right.... Let's see. How about a database analogy? What you are saying is that you should build your own rule engine, the same way that you should build your own relational database management system instead of buying Oracle or SQL Server or DB2. OK. I see your point....

Well, if you're that smart, you may be better off writing your own programming language as well. VB is too slow. And Java just adds one more layer.

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