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Business rule



Business rules or business rulesets describe the operations, definitions and constraints that apply to an organization in achieving its goals. For example a business rule might state that no credit check is to be performed on return customers. Others could define a tenant in terms of solvency or list preferred suppliers and supply schedules. These rules are then used to help the organization to better achieve goals, communicate among principals and agents, communicate between the organization and interested third parties, demonstrate fulfillment of legal obligations, operate more efficiently, automate operations, perform analysis on current practices, etc.


 


Strategic management is distinct from business rule's. Business rules are the foundation on which strategies and tactics are built. The rules simply tell an organization what it can do while the strategies and tactics tell it how to do it to be successful in obtaining its goals. An analogy for the relationship between business rules and strategies would be the relationship between a road map and a path along the map to reach a destination.


 


Example business rule domains include:


 


    * marketing strategies


    * pricing policies


    * customer relationship management practices


    * human resources activities


    * regulatory forces


    * product and service offerings or operation workflows.


How business rules are gathered

Business rules exist for an organization whether or not they are ever written down, talked about or even part of the organizations consciousness. However it is a fairly common practice for organizations to gather business rules in at least a very informal manner.


 


Organizations may choose to proactively describe their business practices in a database of rules. For example they might hire a consultant to come through the organization to document and consolidate the various standards and methods currently in practice.


 


More commonly, business rules are discovered as part of a formal requirement gathering process during the initial stages of a project. In this case the collecting of the business rules are coincidental. Projects, such as the launching of a new product, might lead to a new body of business rules for an organization, i.e. this new product would require the employees to conceptualize about what the purpose of the organization is in a new way. This practice of coincidental business rule gathering is vulnerable to the creation of inconsistent or even conflicting business rules within different organizational units, or within the same organizational unit over time.


 


Business Rules Methodology is the process of capturing business rules in English, in real-time while empowering users to manage rules with a few simple steps.


Best practices

1. Declarative: A business rule is a statement of truth about an organization. It is an attempt to describe the operations of an organization, not an attempt to prescribe how an organization should operate. This is why business rules are said to be discovered or observed and not created.


2. Atomic: A rule is either completely true or completely false; there are no shades of gray. For example a rule for an airline that states passengers may upgrade to first class round-trip tickets if seats are available and they pay the fare increase does not imply that this deal is available for just one leg of the journey.


3. Distinct, independent constructs: Separate the things that define your business (the rules) from the processes (i.e. strategies and tactics). Don't build complex and cyclical dependencies - simplify and flatten the constructs.


4. Expressed in natural language: In order to appeal to the broadest audience, it is almost always best to express business rules in a natural language without the use of a lot of technical jargon.


5. Business, not technology, oriented: For example, a company's business rules should not be foreign to a knowledgeable customer.


6. Business, not technology, owned: Business rules come from business decisions. These are independent from implementation decisions.

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