Business Rule Management in Financial Services · Transformation … Confidential ... Loan...
Transcript of Business Rule Management in Financial Services · Transformation … Confidential ... Loan...
Business Rule Management Business Rule Management in Financial Services:in Financial Services:
Implementing Implementing Transparent Decision ServicesTransparent Decision Services
Stephane MarouaniOperations Manager, ILOG Australia P/L
Stephane MarouaniOperations Manager, ILOG Australia P/L
Sydney, December 6th, 2006
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Agenda
Faster implementation and consistent execution of operational policies
Collaboration between IT and business for policymanagement: the controlled Agility paradigm
Reuse of decision services as a key element of SOA
BPM, BRM, BI : the corner stones of modern Banking IT architecture
Case studies
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Finally, STP is there
No Automation
Highly Automated
(STP)
time
Leve
l of A
utom
atio
n
Automated WorkflowsFewer Human interventionsmostly for Decision-making
activities
Little or No AutomationManual Processes
Many Human interactionsand exchanges
Automated DecisionsHuman interventions
only for handling exceptions
Process Automation Stage
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Crisis
Regulation
Market
CompetitionInternal process
Business Operations
New Product Lines
New Segments
New Desks
New TerritoriesAttractive Offerings
New ServicesNew Bundles
ReorganizationRestructuring
M&A
Basel II
IAS / IFRS
Breakouts
Tsunami
UnexpectedEvents
Drivers for Change
Continuous Need for Change
Need for Agility
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Ability to react to change
Years
Months
Weeks
Days
Hours
Minutes
Seconds
1960s 1970s 1980s 1990s 2000s
Process execution
Product Lifecycle
Process change and built time
Source : Gartner
… is the key differentiator
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Where is the bottleneck?
Business Decisions are in:
Spreadsheets
Databases
ManualProcesses
Mainframe
MonolithicApplications
Challenges for a Change Request
• Need to redefine manual processes
• Every change has to go through IT
• This type of change was not planned
• Rigid legacy system
• Change has to happen in many places
• Change has implications throughout the process
• No easy way to test/simulate the change
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Decisions are business rules rich
Many Decisioning Elementsthroughout the process, such as:
Pricing / QuotingEligibility DeterminationScoringCase AssignmentData validation / ComplianceReconciliation / Transformation…
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Introducing Business Rules Management
Spreadsheets
Databases
ManualProcesses
Mainframe
MonolithicApplications
Rule Repository
User Tools
Decision service
Business Rules are extracted
into a Rule Repository
Rule EngineprovidesDecision
execution and
deployment
User Tools
provide
accessibility and
rule management
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Business Rules for Agile SOA
Validation
Pricing
EligibilityValidation Rules
Eligibility Rules
Pricing Rules
Business Rules• Automate key business decisions• Simplify process and integration logic• Are invoked as standards-based
service from the process• Are much easier and faster to change
than the orchestration
Key benefits
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Transparent Decision Services
Yes
NoRiskAssessment
AcceptableRisk?
Loan Processing Example
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Yes
No
Rule Service
RiskAssessment
AcceptableRisk?
1- loan applicationmisc. data: scores…
2- risk evaluation(Yes/No/Referral)
Loan Processing Example
Transparent Decision Services
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Rule Service User Tools
Rule Repository
Maintain & Audit
Business Rules
Deploy new/updated
Business Rules
Scoring, rating, referral rulesPricing rules
…
Loan Processing Example
Transparent Decision Services
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Loan Processing Example
Rule Service User Tools
Rule Repository
Deploy new/updated
Business Rules
Scoring, rating, referral rulesPricing rules
…
Transparent Decision Services
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Rule Service User Tools
Rule Repository
Maintain
Business Rules
Deploy new/updated
Business Rules
Scoring, rating, referral rulesPricing rules
…
Loan Processing Example
Transparent Decision Services
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SOA stack
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Rule Service
Rule Service
Rule Service
The corner stones of SOA
AutomatedProcesses
Rule basedDecisionServicesB
usin
ess
Inte
llige
nce
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Smart Decisions from End to End
BPMS
Software to automate, integrate and monitor end-to-end business processes
Evolution of Workflow / EAI
Focuses on how people and systems interact
BRMS
Software to model, automate, maintain and monitor business rules
and policies
Evolution of Rule Engines
Focuses on how decisions are made
BI
Software to mine, correlate and display the right
information
Evolution of Data Mining
Focuses on giving the right information to decision
makers
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Credit Decisioning
Goals
Improve customer experience and satisfaction Consolidate inventory of decisioning and automation capabilities into one integrated platformProvide greater customer control by enabling rules management at customer level
Benefits
Improved customer retention and acquisition with enhanced and new service (ASP)Reduced time-to-market by 50%
Policy changes in real-time or days vs. weeks and monthsMore standardized decision making while enabling custom solutions
Solution
ILOG BRMS to support risk assessment, compliance and credit decisioningBusiness rules re-use across business processes, channels and custom solutionsExtend certain rule management capabilities to customers through web-based access
Situation
Decisioning platform would not scale to adapt to growing customer baseLong turn around time to implement new or updated customer policiesHard to integrate and use all data sources
Questions & AnswersThank You
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