how to make sure a computer decision making system will not hurt your business
Post on 13-Apr-2017
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05/02/2023
1Computer controlled decision systems process 100’s of thousands (and more!) decisions per hour… How can I make sure they will not hurt my business?
LUIS CARRASCO-CORTESIBM DIGITAL PROCESS TRANSFORMATION LEADER, CANADA AND CARIBBEAN.ALL OPINIONS ARE MY OWN
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2The 3 MUST HAVE attributes to make sure your computer controlled decision system will result in your business success
In order to ensure excellence in operational execution, a computer decision making system needs 3 attributes:
1. Transparency,
2. Agility and,
3. Governance
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3Transparency to make sure these rules won’t create adverse effects
Transparency is about the BUSINESS people (not just IT people) being able to understand:
What the business rule is in the first place
They also need to understand why the rule exists in the first place
This is about high levels of nuance
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4Transparency to make sure these rules won’t create adverse effects
A critical element of transparency is AUDITABILITY. Can your business people see instantly, when a rule is changed:
1. What was the change that was made?
2. Who made the change?
3. When was the change made?
4. For what reason was the change made?
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5Transparency to make sure these rules won’t create adverse effects
A critical element of transparency is TRACEABILITY.
1. Assume last year you had a rule that determined the price on an insurance policy
2. This year you create a new rule that increases the price
3. Your staff needs to justify why the new rule was implemented in the first place
4. You need to be able to trace on a case by case basis
5. You also need to do business intelligence on all cases that make up the rules
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6Agility to make sure these rules won’t create adverse effects
Simply stated agility is the ability to respond to an opportunity or threat to your organization…
Immediately by changing a rule
Examples: Changes in regulation, competitive threat, major economic event that will impact your business…
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7Agility to make sure these rules won’t create adverse effects
Another real – and sinister – threat businesses and institutions face is Fraud
If a system is meant to counter fraud, the system must be agile to stay ahead of the fraudster
This requires integration into analytical systems to identify the fraud.
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8Agility to make sure these rules won’t create adverse effects
In order to be agile, BUSINESS people need to be able to change the rules
Additionally these business rules have to be kept separate from all other systems
Otherwise you have to do open heart surgery in a major enterprise system to make a simple rule change
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9Agility to make sure these rules won’t create adverse effects
Simulation: Critical to agility and reducing risks
The technology must allow you to simulate the impact of a rule change PRIOR to executing the rule in your business
You need to measure whatever metrics or KPI’s are important to you.
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10Governance to make sure these rules won’t create adverse effects
You need a technology that defines what business people can do with ease and speed
At the same time you also need to define as many controls as you think are appropriate to ensure changes don’t hurt you
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11Governance to make sure these rules won’t create adverse effects
Some organizations will enforce very tight governance where nothing goes into production until it has been thoroughly reviewed
In other organizations very little controls are chosen to achieve instant speed
You define how many controls you think are needed
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12Governance to make sure these rules won’t create adverse effects
What governance looks like… an example:1. Editor (a business LOB manager) makes a change to a rule
2. Someone else – other than the editor – runs simulations
3. Simulations show that the new rule is safe to execute
4. Now you can set up a series of approvals (however many you want)
5. The final approval can come from IT who does the final approval and then operationalizes the new / changed rule in your system.
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13Governance to make sure these rules won’t create adverse effects
Governance also means the following:
1. Users MUST log into the system to make a change
2. Whenever someone makes a change, it will be traced… and all changes have a permanent history
3. People that make changes must have special authorizations
4. The system must provide a special change workflow for authorizations: Define different people with appropriate levels of security.
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14What if I don’t have the technical skills in house?
We recommend you acquire cloud based technology:
No need for dedicated IT
No hidden costs
Pay by the use and scale at the rate you grow
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15Where can I get more information?
Click on these links to see how this technology could help you run your operations
IBM Operational Decision Manager on Cloud
Blueworks Live Process Discovery and Modelling Platform
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16
Thank you
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