Business rules management the next step in process optimisation

The marriage of business process management and business rules management is set to create major benefits for large and complex organisations over the next five years, according to leading German economist and business process theorist Professor August-Wilhelm Scheer.

Prof Scheer, the founder and chairman of software company IDS-Scheer, which produces the ARIS suite of process modelling and design tools, noted that many business process models are highly complex and can be difficult to understand.

"Our goal is to simplify complexity wherever that is possible," he says. "Business rules are one major source of that complexity in many organisations because they`re often poorly understood and not well expressed."

Speaking at the recent Process Day conference organised by local reseller CPI, Prof Scheer said it was possible to radically simplify business processes by identifying and extracting business rules.

"A company might, for example, have quite simple rules for accepting or rejecting an order depending on the size of the order, product availability and the customer`s credit rating," he says. "A traditional process model of how that order is handled can be enormously complex, because the process tends to split every time you encounter a rule; but if you identify and remove the rules, which can usually be represented in a small table, you simplify the entire process."

The benefits for companies grappling with how to manage complex and ever-changing processes are many, he says. "Once you`ve identified and formulated the business rules you can find overlaps and conflicts, reduce the number of rules, improve them, clarify the exceptions and re-use them across many different processes. It also becomes possible to change the rules very quickly, without disrupting processes or organisational structures."

Scheer cited the example of a Milan-based bank which discovered that it had over 30 000 business rules, many of them overlapping, dispersed across many different business units. "This is a fairly typical case," he notes. "Not many people understand their business rules fully and there are usually overlaps, redundancies and competing definitions. If you then go and hard-code those rules into your enterprise resource planning (ERP) system you make your organisation very inflexible."

Scheer notes that while pricing rules, for example, tend to be clearly documented, most organisations have many other rules that are unspoken. "In areas like HR it can be a problem if your rules about, for example, evaluation and career pathing are not clear to everyone. Once you`ve identified your rules and everyone knows they`re talking about the same thing you start to simplify. This is especially important when you need to collaborate with other companies."

Scheer predicts that although this understanding of business rules has limited application so far, they will be widely used within the next five years. "The next generation of ERP systems will definitely separate rules from processes," he says. ARIS already incorporates a rule editor, and IDS-Scheer recently announced a partnership with US-based Corticon, which produces a simple and highly-regarded business rules modeller and engine.

CPI`s Dawie Jacobs says there was a great deal of interest in the Process Day, indicating that South African companies are eager to keep up to date. "We had very positive feedback and are very pleased to have been able to give our local audiences an opportunity to interact with Prof Scheer and his colleagues," adds Jacobs.

Copies of all the Process Day presentations are available at no charge on CPI`s Web site at www.cpi.co.za.