Business Rule Management. Effective IT Modernization

Business Rule Management Effective IT Modernization

Business Rule Management Lynne Harbin, Associate Director Health Eligibility Center, Veterans Health Administration I. Philip Matkovsky, Principal Macro Design Group Pierre-Henri Clouin, Market Development Director ILOG Tom Temin, Editor-in-Chief Government Computer News

Agenda Introduction to Business Rules Management Agility and Control in BPM and SOA Business Rule Management Implementation Conclusion Company Overview Q&A Copyright ILOG, Inc. 2005 3

Business Rule Management Systems

What are Business Rules? Applications Business Policies: - Regulations - Risk profiles - Internal guidelines Business Rules Formal statements of business policies that define or constrain some aspect of the business Benefit calculation Case management Claims processing Eligibility Human Services Fraud detection Licenses Tax Unemployment Copyright ILOG, Inc. 2005 5

Traditional Approach Business Rules are typically found in Challenges for a Change Request Changes are costly, resource and time-intensive Rules are hidden in code Most changes have to be programmed costly Mainframe Lack of consistency Manual Processes Monolithic Applications No central management of rules No reuse of rules Gap between and business analysts and IT administrators Business rules knowledge fades over time Spreadsheets Databases Lack of auditability No easy way to test/simulate the change Copyright ILOG, Inc. 2005 6

Introducing the Business Rule Management System The major elements of a Business Rule Management System (BRMS) User Tools provide accessibility and rule management Mainframe User Tools Manual Processes Monolithic Applications Rule Repository Rules are extracted and stored in a Rule Repository Spreadsheets Databases Rule Engine Rule Engine provides execution and deployment throughout the process Copyright ILOG, Inc. 2005 7

ILOG BRMS Reconciles Automation with Agility Manage change and and complexity Rule Rule Builder Builder IDE IDE Rules Rules Repository Repository Make better decisions, faster Rule Engine Decision Decision Support Support and and Automation Automation - - Case Case assignment assignment - - Benefit Benefit calculation calculation - - Eligibility Eligibility - - Grant Grant Compliance Compliance management management Light Light Rule Rule Builder Builder (Web (Web / / Desktop) Desktop) Rule Engine - - Fraud Fraud detection detection - - Data Data compliance compliance - - Threat Threat detection detection Copyright ILOG, Inc. 2005 8

Business Rules Management Target Areas Entitlement Eligibility determination Benefit calculation Screening and Targeting Fraud detection and IPIA Homeland Security Information dissemination IT Consolidation and Modernization ERP, Financial Management, HR Defense Copyright ILOG, Inc. 2005 9

Agility and Control in BPM and SOA

BPM and SOA Streamline Processes and Improve Flexibility Streamline Processes Years Months Weeks Product Lifecycle Process change and built time Improve Process Flexibility Days Hours Minutes Seconds Process execution 1960s 1970s 1980s 1990s 2000s Copyright ILOG, Inc. 2005 Source : Gartner 11

Streamlining Processes from End to End Many Decisioning Elements throughout the process, such as: Benefit Calculation Eligibility Determination Risk Scoring Case Assignment Data Consistency Validation / Regulatory Compliance Copyright ILOG, Inc. 2005 12

BRMS Maximizes Investment in BPM BPM+BRMS BPM How people and systems interact BRMS How decisions are made Process automation, integration and monitoring Business rules and policies automation, maintenance, and modeling BPM + BRMS streamline processes end to end Copyright ILOG, Inc. 2005 13

BRMS Enhances SOA Agility Compliance, decision, and policy services Automate key business decisions Transparent to business users Seamless integration in orchestration environments Simplified process and integration logic Much easier and faster to change than the orchestration Copyright ILOG, Inc. 2005 14

Preferred BRMS Vendor with BPM and SOA Leaders Copyright ILOG, Inc. 2005 15

Business Rules Management Implementation Briefing 2005

Overview Background Recognition that Business Rules Management is valid approach Framework for assessing viable toolsets Solution architecture Analysis and Design challenges and opportunities with business rules management Solution implementation and program management 17

Background The Veterans Health Administration operates the largest healthcare delivery system in the U.S., serving over 7.5 million enrolled participants, with roughly 5 million receiving health services through the system VHA is organized into 21 Veterans Integrated Service Networks (VISNs) with: 133 decentralized field facility VistA systems 162 hospitals 137 nursing homes 43 domicilaries 850+ community and facility based clinics VHA is headquartered in Washington, D.C.; this project is a joint effort of two headquarters organizations, the Business Office and the Office of Information 18

Background Governed Largely by Title 38 United States Code and 38 Code of Federal Regulations Chapter 17 Within limits, interpretations can be applied to policy by the Administration, e.g. Threshold values for means testing Updates to dates Combat locations Enrollment group thresholds, etc. 19

Background Eligibility Determination Eligibility factors are determined and verified Also covers means testing and income verification; if need is determined, veteran does not incur charges for service Decision regarding eligibility Eligible Veterans are Assigned to Priority Groups Enrollment is managed through a priority system: There are currently eight priority groups; Priority 7 and 8 have subgroups Highest priority enrollment is for veterans with serviceconnected conditions rated 50-100% disabling, lowest priority for higher income nonservice-connected veterans Secretary sets enrollment group threshold by priority group Enrollment decision is applied after determining priority group assignment 20

Background: Workload Over 7.5 Million Enrollees as of 2005 Roughly 900K new enrollees per year. Veterans enrollment priority and status may be adjusted due to changes in compensation or pension award, financial or health status, or military service factors. 800,000 cases subject to Income Verification in 2004, potential for up to 1.6M per year. 21

Background: Current IT Environment Two Sets of Systems Distributed Central Distributed System: At point of intake for a new patient M-based legacy system Message sent to central system Message-Based Interface between Distributed and Central System is HL7 22

Recognition that Business Rules is Valid Approach Business Drivers Current environment proves cumbersome to make major changes to business rules Gains Mechanism for rapid deployment of changes to policy and/or business in systems without excessive costs: time, resources Legacy rules maintained in source computer code, inconsistently documented requirements/design documents Conversion of rules from current mode provides opportunity to review, rationalize and manage rules in business-friendly manner 23

Recognition that Business Rules is Valid Approach Business Drivers Business domain is a rules-intensive process with close integration between policy and operational processes Major modernization effort provides opportunity to implement accessible rules sets for service in multiple modes Gains Rules management strategy enables business to more closely maintain rules as business assets; business has identified staff to manage rules business language Business rules engine / common rules enable VHA to use standardize business rules for centralized, distributed, selfservice; current implementation then serves as foundation for subsequent process and systems enhancements 24

Recognition that Business Rules is Valid Approach Primary Technical Drivers Service Oriented Architecture Require rules management system capable of integrating with SOA; lightweight call to BR tier Integration with Workflow management Require that rules management system interoperate with BPM components Improved Development of complex rules-based determination systems Robust environment for development, testing, debugging, deployment and management of rule sets 25

Assessing Toolsets Rule development environment IDE: Tools for authoring, testing, deploying and managing Requires adoption in development teams Rule management Multiple views into rules repositories: ability to support business view into rules (e.g. in conjunction with specification) Must support enhancing definition of software requirements Business view to authoring, promotion and versioning of rules Ease of deployment of rules changes Integration with SOA Lightweight access to rule-sets from multiple application/service contexts Robust rules engine Rule algorithm, support for forward/backward chaining Devotion to R&D (e.g. both inductive and deductive rule definition) 26

Assessing Toolsets Integration with development management environments Product support and training Dedicated product support Diversity of course offerings Deployment base Indication that product set has been adopted by organizations with similar requirements sets Demonstrable success in comparable initiatives Standards Support 27

Solution Architecture Phase 1 Rules layer Asynchronous messaging exchange Enterprise DB J2EE Service Tier EAI Exceptions and other processes managed by workflow management system BPM BPM Workflows Local Environment 1 Local Environment 1 Local Environment 1 28

Solution Architecture Phase 2 Enterprise DB Rules layer J2EE Service Tier EAI BPM BPM Workflows Self-service system accesses consolidated rule repository; enables re-routing of major workload Rules Exposed via API to synchronous application Local Environment 1 Local Environment 1 Local Environment 1 Self-service mode 29

Solution Architecture Phase 3 Enterprise DB BPM Rules layer J2EE Service Tier BPM workflows BPM workflows Self-service mode Distributed environments are replaced by functional groupings supported in workflow modules (e.g. appeals, cases, etc.) 30

Analysis and Design challenges and opportunities Rules offer unique opportunity to narrow semantic gap (concept attributed to Paul Marshall) Typical textual representation of requirements persists in RUP Rules management allows for expression of actual requirement in a mode understandable to business and implementation Challenge: recognizing that definition practices need to evolve While rule authoring assumes a particular implementation path, business oriented rule language allows analysts, within UC text, to employ alternative mode for capturing and representing requirements Engaging business representatives earlier in embellishing rule metadata and ensuring validity of rule-sets 31

Solution Implementation and Program Management Current state Well on way to implementing Phase 1 Begun analysis of Phase 2 Initiating inclusion of business-led activity in rule management 32

About ILOG Changing the rules of business Founded in 1987 Publicly traded (NASDAQ) FY05 - $125 Million Revenue 690 Employees Worldwide Leader in Business Rule Management Systems (BRMS), Optimization, and Visualization 2,500+ customers 490 ISV/ OEM partners Operating in 30 countries Copyright ILOG, Inc. 2005 33

Thank you &