A Practical Approach Using Decision Management and Decision Modeling at The Principal

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1 Building Business Capability (BBC) 2013 A Practical Approach Using Decision Management and Decision Modeling at The Principal Doris Kimball and Don Perkins

2 Welcome and Introduction Doris Kimball Senior Business Analyst at The Principal Financial Group 10+ years experience with business analysis in financial services IIBA Central Iowa LOMA designations: FLMI, FFSI, ACS, AAPA, AAIA, AIRC Don Perkins Independent Business Rule Consultant 20+ years experience with rules across multiple domains Consulted for The Principal, MasterCard, Great West Life, Target, Nissan, US West, Dex, Ford IIBA Denver

3 Welcome and Introduction At the Principal Financial Group (The Principal ), we are developing a Decision Centric Approach to discovering and documenting business rules What does that mean? What are the benefits?

4 Agenda Overview of Projects Fundamentals Teaching Our Approach Benefits Lessons Learned Questions

5 Overview of Projects

6 Sample Projects Several past and ongoing project apply a decision centric approach to discover and elicit business rules Project Annuity Payments Brief Description Evaluate good order status of incoming payments Annuity Applications Evaluate good order status of application materials Add new financial products

7 Sample Projects More projects applying a decision centric approach Project Life Insurance Underwriting Brief Description Streamline the level of medical information gathered Assess risk class Pension Client Transitions Onboard clients in new and transferring accounts.

8 Fundamentals

9 Fundamentals Our decision centric approach blends multiple disciplines: Discover, document, diagram, and prioritize decisions using Decision Management principles Elicit and structure business logic using The Decision Model principles Verbalize key business rule statements using RuleSpeak principles

10 Fundamentals Discover Decision Characteristics

11 Decision Management Methodology Capture high level operational decisions by exploring business processes Document key decision characteristics Clearly state the one question that the decision answers Diagram decision requirements for human consumption Prioritize decisions to maximize business benefit

12 Decision Management Methodology Begin detailed analysis with one process-level decision in mind and identify the supporting decisions Be transparent and agile make analysis artifacts easy to understand and change over time Improve the quality of important decisions over time

13 Decision Management Methodology Based on the work of James Taylor and Decision Management Solutions Particularly chapters 4 and 5 of Decision Management Systems A Practical Guide to Using Business Rules and Predictive Analytics

14 Decision Management Information Example of decision characteristics being captured and documented.

15 Decision Prioritization Sample scorecard to rank process-level decisions.

16 Decision Requirements Diagram Typical mid-level decision with dependencies

17 Decision Requirements Diagram Summary of a decision with a large set of dependencies

18 Decision Requirements Diagram

19 Fundamentals Elicit Business Logic

20 Decision Model Methodology Separate business decision logic from business process Create decision model diagrams or continue to refine decision requirement diagrams using the same structure Document business logic with tabular rule families Work top-down from process-level rule family to supporting rule families

21 Decision Model Methodology Rule family content is constrained using structural, declarative, and integrity principles Each rule family uses a set of input conditions to reach exactly one output conclusion All input conditions are independent of each other All allowed conclusion values must be represented

22 Decision Model Methodology Based on the work of Barbara von Halle, Larry Goldberg, and Knowledge Partners International Particularly chapters 6 through 10 of The Decision Model A Business Logic Framework Linking Business and Technology

23 Rule Family Template

24 Rule Family Example

25 Fundamentals Verbalize Business Rule Statements

26 Business Rule Statements A business rule statement is a well formed verbalization for one row of business logic Business rule statements are allowed by, but not required by, the decision model methodology A business rule statement provides an opportunity to Document business intent in a refined way Explain a decision outcome for guidance

27 Business Rule Statements Define business logic in table first, then verbalize a corresponding statement The business rule statement is a beneficial outcome of this approach, but is not the primary artifact Only need to define statements for outcomes that need to be explained

28 Guidelines for Rule Statements A good business rule statement is a grammatically correct complete sentence starts with the subject describes the subject with whatever detail is appropriate to define the rule defines a constraint using all of the pieces of information that are under consideration explains the conclusion being reached represents business intent

29 Sample Business Rule Statements A tax qualified annuity cannot have joint ownership. A tax qualified pension trust cannot have individual ownership. A tax qualified annuity that is not a pension trust cannot have trust or corporation ownership.

30 Business Rule Statements in Context Business rule statements are derived from the tabular logic.

31 Teaching Our Approach

32 Basic Process Business Analysis Planning Draft Shell of Decision Identify Sub- Decisions Elicit Conditions Add Message Populate Rule Family

33 Basic Process Business Analysis Planning Draft Shell of the Decision Identify Sub- Decisions Elicit Conditions Add Message Populate Rule Family

34 Basic Process Business Analysis Planning Draft Shell of the Decision Identify Sub- Decisions Elicit Conditions Add Message Populate Rule Family

Basic Process Decision Diagram Message /

NIGO 3 4 5 Business vocabulary term that

35 Basic Process Decision Diagram Message / Business Rule Statement Rule Family Conclusion Conditions Index Withdrawal Request Good Order Status 1 is IGO 2 is NIGO Business vocabulary term that best describes the conclusion of the decision

36 Basic Process Business Analysis Planning Draft Shell of the Decision Identify Sub- Decisions Elicit Conditions Add Message Populate Rule Family

37 Basic Process Business Expert: First, we review the withdrawal form for completeness. Then, we make sure the customer has sufficient funds within his account. We also make sure the customer s remaining account balance after the withdrawal meets the account s minimum balance requirement. Conditions: 1. Withdrawal Service Form Completeness Status 2. Account Pre Withdrawal Balance 3. Account Post Withdrawal Balance

38 Basic Process Decision Diagram Conditions Index Message / Business Rule Statement Rule Family Conclusion Withdrawal Request Good Order Status 1 is In Good Order 2 is Not In Good Order Withdrawal Service Form Completeness Status Conditions Account Pre Withdrawal Balance Good Order Status Account Post Withdrawal Balance Good Order Status

39 Basic Process Business Analysis Planning Draft Shell of the Decision Identify Sub- Decisions Elicit Conditions Add Message Populate Rule Family

40 Basic Process Business Expert: Yes, the customer must complete the form. If the form is incomplete, we cannot process the withdrawal request as submitted. Index Message / Business Rule Statement Conclusion Withdrawal Request Good Order Status Withdrawal Service Form Completeness Status 1 is IGO is Complete 2 is NIGO is Incomplete Conditions Account Pre Withdrawal Balance Good Order Status Account Post Withdrawal Balance Good Order Status

Basic Process Complete Rule Family Index Message / Business Rule Statement Conclusion Withdrawal Request Good Order Status Withdrawal Service Form Completeness Status Conditions Account Pre

41 Basic Process Complete Rule Family Index Message / Business Rule Statement Conclusion Withdrawal Request Good Order Status Withdrawal Service Form Completeness Status Conditions Account Pre Withdrawal Balance Good Order Status Account Post Withdrawal Balance Good Order Status 1 is IGO is Complete is IGO is IGO 2 is NIGO is Incomplete 3 is NIGO is NIGO 4 is NIGO is NIGO The Withdrawal Request Good Order Status is In Good Order when the Withdrawal Service Form Completeness Status is Complete AND the Account Pre Withdrawal Balance Good Order Status is In Good Order AND the Account Post Withdrawal Balance Good Order Status is In Good Order.

42 Basic Process Business Analysis Planning Draft Shell of the Decision Identify Sub- Decisions Elicit Conditions Add Message Populate Rule Family

43 Basic Process Index Message / Business Rule Statement Conclusion Withdrawal Request Good Order Status Withdrawal Service Form Completeness Status Conditions Account Pre Withdrawal Balance Good Order Status Account Post Withdrawal Balance Good Order Status 1 is IGO is Complete is IGO is IGO The customer's withdrawal request cannot be processed because the service form is incomplete. The customer's withdrawal request cannot be processed because the account has insufficient funds to cover the requested amount. The customer's withdrawal request cannot be processed because the account balance after the withdrawal is not in good order. is NIGO is Incomplete is NIGO is NIGI is NIGO is NIGO Business Messages

44 Basic Process Business Analysis Planning Draft Shell of the Decision Identify Sub- Decisions Elicit Conditions Add Message Populate Rule Family

45 Basic Process Business Expert: We do evaluate the form to make sure certain criteria are met, such as the owner signed the form. Before with Input Data After with Supporting Decisions

46 Basic Process Index Message / Business Rule Statement Conclusion Withdrawal Request Good Order Status Withdrawal Service Form Completeness Status Conditions Account Pre Withdrawal Balance Good Order Status Account Post Withdrawal Balance Good Order Status 1 is IGO is Complete is IGO is IGO The customer's withdrawal request cannot be processed because the service form is incomplete. The customer's withdrawal request cannot be processed because the account has insufficient funds to cover the requested amount. The customer's withdrawal request cannot be processed because the account balance after the withdrawal is not in good order. is NIGO is Incomplete is NIGO is NIGO is NIGO is NIGO

47 Basic Process Repeat the steps for the next decision

48 Basic Process How do you know when you are done? The overall process-level decision is fully decomposed when each lowest-level supporting decision consists of only input data.

49 Basic Process Summary of Key Deliverables Decision Diagrams Rule Families Vocabulary

50 Benefits and Lessons Learned

51 Benefits Produce high quality analysis artifacts, because it s easy to Focus an elicitation session on a single topic Understand and validate analysis artifacts Find errors, gaps, and conflicting rules Train methodology to business analysts Reuse business rules as supporting decisions

52 Benefits Same artifacts referenced by business and IT Reduced gap between analysis and development Direct implementation of business rules Clearly defined scope boundaries Supports an agile development approach Supports implementing a multiple-project roadmap

53 Lessons Learned Establish early foundation by adapting guidelines for Decision management information to collect Rule family template Decision status values and change control governance Business vocabulary guidelines Decision model operators

54 Lessons Learned Work top-down from process-level decision to its supporting decisions Decompose complex decisions into small chunks Separate data quality decisions from business decisions

55 Questions? No part of this presentation may be reproduced or used in any form or by any means, electronic or mechanical, including photocopying or recording, or by any information storage and retrieval system, without prior written permission from the Principal Financial Group. Copyright 2013 Principal Financial Group, Inc.

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