An Introduction to Decision Management. James Taylor CEO
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1 An Introduction to Decision Management James Taylor CEO
2 2014 Decision Management Solutions Your Presenters James Taylor I m a passionate believer in the power of Decision Management to deliver simpler, smarter and more agile processes. I write, speak, consult and work on Decision Management and Decision Modeling. Juergen Pitschke I m a coach, consultant, speaker, writer, Engineer dealing with Enterprise Architecture and all kinds of enterprise models
3 Agenda Decision Management Decision Models Decision Modeling Decision Models and BPM Decision Models and EA 2014 Decision Management Solutions
4 Question 1: What is Decision Management? What is in scope? What is out of scope? BCS Dr. Juergen Pitschke , Page 3
5 Decision Management A business discipline and a technology stack That builds on existing IT infrastructure Enhancing business processes Leveraging analytics to manage uncertainty Increasing transparency and business control It is a proven framework for implementing business rules management systems and analytics 2014 Decision Management Solutions
6 2014 Decision Management Solutions 3 steps to decision management Identify and model the decisions that are most important to your operational processes Design and build independent decision services using business rules and advanced analytics Create a closed loop between operations and analytics to measure results and drive improvement
7 2014 Decision Management Solutions Business Rules Predictive Analytics External Data Big Data
8 Question 2: How can we describe Decisions? What is in the Decision Model and Notation standard? How are Decision Models related to other artefacts? BCS Dr. Juergen Pitschke , Page 7
9 2014 Decision Management Solutions Repeatable Automatable Non trivial Measurable
10 Input Data Decision Authority Dependent Decisions 2014 Decision Management Solutions
11 Decision Tables or Rulesheets Most common rule format A set of rules in a tabular layout Look up tables, comparing attribute values Various formats Credit Limit Assignment Card Type Credit Limit Income < $40,000 >= $40,000 Standard $1,000 $2,000 Gold $1,500 $2,500 Special Discount Type of Order Web - Customer Location US - Applicant Risk U Medical Applicant Age History Applicant Risk Rating 1 good Medium > 60 2 bad High 3 [25..60] - Medium 4 good Low < 25 5 bad Medium Type of Customer Wholesaler Retailer - Special Discount % F Decision Management Solutions
12 Decision Modeling and Notation (DMN) provide a common notation that is readily understandable by all business users... DMN creates a standardized bridge for the gap between the business decision design and decision implementation. Use Cases Modeling Human Decision-making Modeling Requirements for automated Decision-making Implementing automated Decision-making OMG Beta Specification Released Standard expected mid-2014 Decision Management Solutions, IBM, Oracle, TIBCO, FICO, Escape Velocity, KUL, Model Systems, KPI, Visumpoint 2014 Decision Management Solutions
13 DMN In context Integrates with process models at decision points Defines decision-making explicitly Maps to implementation details 2014 Decision Management Solutions
14 Manage Business Rules Documented sources Ownership, volatility Coherent rule groups 2014 Decision Management Solutions
15 Define Automation 2014 Decision Management Solutions
16 Question 3: Notation is notation. What does a method for Decision Modeling look like? BCS Dr. Juergen Pitschke , Page 15
17 2014 Decision Management Solutions Use Cases For Modeling Decisions Simplify processes Effectively deploy business rules Effectively deploy predictive analytics Flexibly define automation boundaries
18 Describe Decisions Define Decisions with A question Possible answers Q: Which marketing offer should be presented to this customer during this interaction? A: Any current, available marketing offer in the database 2014 Decision Management Solutions
19 Specify Decision Context Processes Activities require decisions Events Trigger decisions Systems Implement decisions Organizational Units Make decisions Own decisions Are impacted by decisions Know which business processes will be improved by your rules or analytics Know when your analytics might be calculated Know how you will have to deploy your rules Know who will have to believe your analytics and own your rules 2014 Decision Management Solutions
20 Specify Decision Impact Objectives impacted Customer Churn Customer Profitability Multiple Products What is the best up sell/crosssell for this customer? * * What is the price of this * * service? Can this customer buy this * service? What retention offer should * we make this customer? 2014 Decision Management Solutions
21 Decisions Require Information Determine Parts Availability requires BOM and Inventory information Validate Tax Return requires Return and Citizen information Refer claim for fraud requires Claim and Provider information 2014 Decision Management Solutions
22 Knowledge and Decisions Decision 2014 Decision Management Solutions
23 Decisions require Knowledge Reorder parts requires supplier capabilities, shortage risks Validate Tax Return requires Tax Regulations Refer claim for fraud requires likelihood of fraud 2014 Decision Management Solutions
24 You can Decompose Decisions What is required to make this decision? Knowledge Guidelines, policy Expertise Regulations Predictive Analytic Models Data Mining Results Information Reference Data Transaction Data The results of other decisions 2014 Decision Management Solutions
25 Decisions can require Decisions These decisions must be made first Is this a good time to make an offer? Which product should the offer be for? How valuable an offer? 2014 Decision Management Solutions
26 Question 4: How do Decision Models impact process models?
27 A real word example from BCS Business Process for handling an application Total of 48 such models, cause there are 48 application forms for different services BCS Dr. Juergen Pitschke , Seite 26
28 A real world example BCS Dr. Juergen Pitschke , Page 27
29 A real world example BCS Dr. Juergen Pitschke , Page 28
30 The new process model One process model for all application types BCS Dr. Juergen Pitschke , Seite 29
31 Decision Logic for the process BCS Dr. Juergen Pitschke , Seite 30
32 Question 5: How do Decision Models integrate into Enterprise Architecture?
33 Decision Management and EA If you can t describe it, you can t build it. John Zachman Decision Model Process Model? BR Engine WF Engine EP Service? UI Model Appl. Model Security Service UI Service Appl. Service Data? Model BI Service Data Service Business Architecture System Architecture Connect the dots: How are Decision Models related to Business Process, Events, Strategy, Requirements, BCS Dr. Juergen Pitschke , Page 32
34 2014 Decision Management Solutions Today these pieces are semi-detached 1. Operational systems are built in a variety of ways Business Process Management Application Context Event Processing Enterprise Application 3. Reports and queries are intended to improve decision making Data Infrastructure Business Intelligence 2. Data is extracted for analysis Performance Management 4. Dashboards are used to monitor performance
35 2014 Decision Management Solutions Powerful technologies are underutilized 1. Business rules are forced into business processes Business Rules Business Process Management Application Context Event Processing Enterprise Application Predictive Analytics 2. Predictive analytics are forced into reports or left stand-alone Data Infrastructure Business Intelligence Performance Management 3. Optimization has limited, localized effect Optimization 4. The effectiveness of decision-making is not tracked or improved Decision Analysis
36 2014 Decision Management Solutions Decision Management maximizes ROI Decision Management links these technologies to the application context Application Context Business Intelligence Business Process Management Event Processing Decision Management Enterprise Application Performance Management Data Infrastructure Business Rules Predictive Analytics Optimization Decision Analysis Decision Management ties heterogeneous technologies into a coherent approach for better results Decision Management allows decision performance to be tracked, analyzed and ultimately improved Decision Management ties how decisions are being made and what can be done to improve them directly to business performance
37 2014 Decision Management Solutions CRISP-DM ModernAnalyst.com
38 Wrap-up
39 2014 Decision Management Solutions Getting Started Model Decisions with DMN Decision Technology Blueprint Focus Business Rules on Decisions Proof of Concept Project
40 2014 Decision Management Solutions Learn More about Decision Modeling Online Training Live, online training May 6,7,8 and 13,14,15 More information at decisionmanagementsolutions.com /services/decision-modeling European Training Decision Modeling for Business Analysts: DMN May 15/16, Dresden The BPM Trilogy: BPMN, CMMN, DMN in context July 14-16, Dresden
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