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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Thank you