I facilitated a breakfast session this morning discussing BPM in the cloud, which was a lot of fun, and now I’m in the keynote listening to James Taylor on the role of decision management in agile, smarter systems. Much of this is based on his book, Smart (Enough) Systems, which I reviewed shortly after its release.
Our systems need to be smarter because we live in a time of constant, rapid change – regulations change; competition changes due to globalization; business models and methods change – and businesses need to respond to this change or risk losing their competitive edge. It’s not just enough to be a smarter organization, however: you have to have smarter systems because of the volume and complexity of the events that drive businesses today, the need to respond in real time, and the complex network of delivery systems by which products and services are delivered to customers.
Smarter systems have four characteristics:
- They’re action-oriented, making decisions and taking action on your behalf instead of just presenting information and waiting for you to decide what to do.
- They’re flexible, allowing corrections and changes to be made by business people in a short period of time.
- They’re forward-looking, being able to use historic events and data to predict likely events in the future, and respond to them proactively.
- They learn, based on testing combinations of business decisions and actions in order to detect patterns and determine the optimal parameters (for example, testing pricing models to maximize revenue).
Decision management is an approach – not a technology stack – that allows you to add decisioning to your current systems in order to make them smarter. You also need to consider the management discipline around this, that will allow systems to not just become smarter, but begin to make decisions and take actions without human intervention.
James had a number of great examples of smarter systems in practice, and wrapped up with the key to smarter systems: have a management focus on decisions, find the decisions that make a difference to your business, externalize those decisions from other systems, and put the processes in place to automate those decisions and their actions.
Hi Sandy,
I’d like to point out that there is a limit to decision services or decision management or decision automation, whichever term you use. When James Taylor and I wrote Smart (Enough) Systems, we were very careful to point out in the book that this applies to only a very limited number of decision types, not all decisions. Those that can be codified are generally customer-facing (though there are others such as logistics, etc.), generally of large numbers and, most importantly, not so critical on an individual level that it hurts too much to be wrong. In other words, if you get 100,000 insurance inquiries a day and deny coverage to a handful that should have been covered (or alternatively, cover some that shouldn’t), it’s OK because you keep working at it to get better models (adaptive control).
Decision services can also advise humans where it would be reckless to allow a decision model to take complete control.
Then, of course, there are decisions that are best left to experts.
Sorry I couldn’t make it to BRF, I was elsewhere.
-Neil Raden
Neil, thanks for your clarification. Missed you at BRF!