What do business rule management systems do?
Business rule management systems (BRMS) improve the way organizations manage change and deal with high variability by externalizing a company's decision logic from hard-coded systems to a central repository, where it can be easily managed and shared across any system in the enterprise. Policies and decisions are automated and put into the hands of business teams who can then change, test and launch the rules in a fraction of the time it normally takes.

Change occurs with evolving market conditions, the competitive landscape, new regulations, procedures or policies, new business objectives and so forth. Variability is represented by different customers, locations, products or processes; a BRMS easily handles change and variation. One of the key benefits of this capability is mass customization—the ability to apply fine-grained terms, offers, actions, or other custom decisions at the individual level, based on individual case information.

What's the difference between a BRMS and a rules engine?
A BRMS incorporates a rules engine (or run-time environment), but it's much more robust in that it adds tools for stakeholder groups, including IT, business users and system administrators. Business rule management systems also help organizations handle change management holistically, supporting the business rule lifecycle from inception to retirement and connecting business and IT teams along the way.

How can I tell if a BRMS is a good fit for an application?
A key factor is the degree and frequency of change in a particular business operation—the need for speed. For processes that must be updated quickly or often, a BRMS enables quick change without lengthy IT projects.

The level of complexity of the decisions in question should also be taken into consideration. A BRMS would be a good fit for applications with large volumes of complex business policies, like those involving risk-based pricing or custom point-of-sale decisions that can engage hundreds to thousands of business rules (basically if-then-else statements).

Ownership can determine fit. Regardless of the frequency of change, some rules—like those in risk management and scoring—need to be in the tight control of non-technical business users. A BRMS provides a comprehensive yet user-friendly environment for rule creation, access and maintenance in these cases.

You might also consider your company's need to justify actions or decisions. For example, "Why are you rejecting this application for a loan?" "Why was that claim settled for $550.00?" A BRMS handles decisions consistently and documents the reasoning behind them, yet it allows special situations to be handled differently, yielding drastic savings of time, error, and liability, and it shifts your focus to exception management.

Your compliance and auditability requirements will indicate if you need a BRMS. With a BRMS, compliance policy changes can be made in minutes or days, rather than in weeks or months. At any point, you can take a "snapshot" of current policies and review it in simple language. You can also capture the history of your policy changes over time—a powerful way to quickly and thoroughly meet all your compliance mandates.

What are typical applications for BRMSs in financial services?
BRMSs provide business gains in financial services functions ranging from credit origination, marketing, accounting and core banking systems such as payment gateways.

Customer relationship management (CRM) and point-of-sale (POS) enhancements are in high demand, due to current market conditions and increased scrutiny of business operations. You can expect higher customer acquisition rates through better customer experiences and highly compelling offers when you embed a BRMS into your CRM and POS systems. Complex functions, like creating unique bundles based on the best fit between a customer's goals, preferences and risk profile are automated in real time. BRMSs improve customer service and increase up-sell and cross-sell revenues, boosting customer retention.

Financial services companies, typically with high compliance requirements, frequently automate their applications for compliance mandates with BRMSs because of the higher consistency, transparency and auditability these systems provide.

How should my company start using a BRMS?
Ideally, a BRMS is deployed gradually. First, identify functions that require many policy or decision changes with fast implementation. Look at business areas you're trying to improve with more speed, less manual handling, high consistency, more fine-grained customization, or better compliance transparency and reporting; these are your immediate areas of concern where automated decisioning will provide dramatic returns.

Look for an application that has well-known and documented business policies, because less time will be spent on harvesting and understanding rules before putting them into a BRMS.

A good place to start using a BRMS is with your point-of-sale (POS) applications. Most organizations already have their POS rules documented in product or service catalogs via PDF documents, rate sheets or spreadsheets. A BRMS will show its capabilities for improving customer service, streamlining processes and cutting costs—quickly.

Commercial lending is a popular starting point in banking. Most commercial lending systems are heavy on expensive manual processing, and yield dramatic cost and time savings quickly with BRMSs, providing faster and better customer service.

Once the first application is deployed, your IT and business teams will have a clear idea of how to use business rules, and further expansions can be made with confidence.

What skills are needed for successful BRMS deployments?
It is critical that both your non-technical business and IT stakeholders are involved in the deployment process. Your business representatives are experts in the functions being automated, and your IT staff delivers the infrastructure that will support business rule management. In some instances, such as legacy migration projects, people with specific experience (i.e. COBOL, Fortran, etc.) may be needed to harvest rules from existing systems.

Typically, a BRMS team is made up of the following roles:

• The BRMS project lead, who defines the task-level implementation plan, resources, task dependencies, and so forth. The project lead is also responsible for the overall testing strategy and governance process
• An architect, who defines the overall solution, including the technical architecture and the integration of the BRMS into the technology stack. The architect also keeps an eye on the re-usability of the infrastructure and BRMS-based decision services across other product lines, divisions, or lines of business, making sure your BRMS investment is fully leveraged through expansion
• A business policy analyst, who defines the rule architecture, which is the organization of rules into logical categories that correspond to the way business analysts think about their policies and rules
• A rule developer, who is responsible for implementing the business rules
• Internal business customers, who are the subject matter experts about the application's policies, decision logic and goals.
• The project stakeholders, who represent both non-technical business and IT groups

Can non-technical staff work easily with a BRMS system?
Your non-technical business staff should often be involved in updating and maintaining your business rules, so your BRMS evaluation should include a close look at the non-technical user interface. Your chosen BRMS should provide tools for each type of user, from non-technical business experts to developers and architects.

Some BRMS products have a Web-based interface that includes English-language rule terminology. In these cases, your non-technical users make rule changes through the interface, then test and route the rules to IT or a rule governance team for approval and deployment. They might author and maintain rules in Microsoft Word or Excel in .NET environments.

What is involved in system maintenance?
It's helpful to think of the business rule lifecycle in which rules are defined, validated, tested and deployed within a production system. Rules are monitored and updated with versioning controls as business circumstances change, and then are retired when no longer relevant.

Non-technical business users usually maintain policy management, which consists of business rule creation and/or updates. IT teams usually maintain the BRMS platform, adding or phasing out decision attributes, updating rule vocabulary or re-organizing rule hierarchies. IT teams also make sure technology integration testing is done along with business outcome testing. System administrators maintain business rule staging on your test server, deployment, and rule-execution monitoring throughout all systems.

What improvements can I expect from a BRMS?
You will see several improvements when using a BRMS, such as:

• Increased speed-to-market for products, services and business policies. Companies often experience speed gains of of great magnitude. Product or eligibility guideline updates can be rolled out in a matter of hours with a BRMS, compared to weeks without.
• Streamlined operations, including cost reductions, faster processing and better customer service. Entire customer service organizations have moved from being transactions-orientated to being more relationship-centric, dealing almost entirely with exceptions and gaining spare bandwidth for other strategic improvements.
• High-quality decisioning, applied quickly and consistently.

How do BRMSs fit into standard IT platforms like Java, .NET and COBOL?
The ease of integration depends on the BRMS. When a BRMS is natively built in the platform of your business, the design, maintenance and execution of BRMS applications are simplified.

From a developer's standpoint, a BRMS should fit within the most frequently used development environment. For example, a BRMS used with Java stacks should fit within the Eclipse Integrated Development Environment (IDE); a BRMS should work with Microsoft Visual Studio and the Microsoft SharePoint collaboration infrastructure when used on the .NET platform.

COBOL is an interesting case: A BRMS system with COBOL deployment capabilities will resolve both the need for speed and the protection of previous investments, allowing the externalization of business logic from legacy COBOL systems for better and faster change management, while ensuring the continued business operations of core support systems.

How is ILOG's Business Rule Management System (ILOG BRMS) used throughout the lending process?
ILOG's BRMS technologies are used throughout the lending process and across lines of products, such as prime or sub-prime mortgages, home equity lines of credit, credit cards, commercial products and auto loans. It automates critical decisions, such as pre-qualification processes, underwriting, pricing, deal structuring, cross-selling, best execution practices, credit scoring, risk grading and compliance procedures.

The following table illustrates how ILOG BRMS is used in the lending and credit sector:

Who in the financial services industry uses ILOG BRMS products and services?
Our customers include:

• Eight of the top ten Fortune 500 commercial banks, including Credit Suisse, Deutsche Bank and Bank of America
• Five of the top six Fortune 500 diversified financial companies, including Fannie Mae, Freddie Mac and Countrywide Home Loans
• Other leading financial service institutions such as Equifax, Wells Fargo, Commerzbank, CitiMortgage, Wachovia and Visa International

Why should my company use ILOG BRMS?
Financial services companies build flexible decision automation services that enhance their operational efficiency, optimize processes and improve customer retention and acquisition with ILOG's business rule management system (BRMS). ILOG BRMS goes beyond basic automation by enabling advanced decisioning capabilities to automate changes to your product guidelines and regulatory policies along with your organization's best practices and knowledge.

Key reasons for choosing ILOG BRMS:

• Recognized leadership
  For over 20 years, ILOG has delivered the most advanced products on the market to support financial service operations. That's why ILOG is consistently recognized as a technology leader by leading analyst firms such as Gartner, Forrester, IDC and Tower Group, as well as industry publications such as Mortgage Technology.
• Proven implementation and delivery
  Hundreds of successful, real-word projects validate the ILOG Solution Implementation Standard (ISIS) methodology.
• Unique domain know-how and industry best practices
  Through years of work with industry leaders, ILOG has formalized best practices, implementation roadmaps, modeling tools, frameworks and templates that address functions specific to lending, such as product pricing and eligibility, automated underwriting and best fit. Backed by product, domain and project delivery experts, ILOG's lending practice helps you achieve better results faster, while reducing development time, costs and risks.
• End-to-end business rule management
  ILOG has the only business rule management system (BRMS) that controls the life cycle for business rule stakeholders across the enterprise, accelerating and simplifying critical rule creation and governance tasks.
• The most scalable and flexible system
  Scale from your desired starting point to automate any credit, lending or business process throughout the enterprise-at the right speed for your organization. ILOG's technologies are built on flexible architecture that serves several processes and functions; it is used across industries by Global 1,000 firms.

What kind of results can we expect from ILOG BRMS?
ILOG BRMS software and services have a proven track record of enhancing core business processes. You can expect to experience the same results that our financial services customers have achieved to date, such as:

• A 50-percent decrease in time to market
• Over a 50-percent reduction in the cost of origination and underwriting with the introduction of automated decisioning and centralized rule management
• Over a 15-percent increase in customer bases, with real-time decisions made at the Point of Sale (POS)
• Improved offering quality and maximized cross-sell opportunities with best-fit, near-fit and counter offers
• Accurate and consistent risk and credit capacity assessments, to help fine tune risk-based pricing
• Improved compliance monitoring and fraud detection with less false positives
• Better audit trails throughout the lending process and across lines of products

Is ILOG BRMS user friendly and easy to integrate?
ILOG BRMS is the only business rule management system that allows both business and IT professionals to easily and successfully manage the rules that drive lending operations—without compromising on power. Financial service institutions now have the scalability, predictability and reliability they need to stay ahead. ILOG BRMS includes centralized rule management with permission-based access control, queries, history management, versioning, a high-performance rule engine and a Web-based rule maintenance application that includes wizards, point-and-click rule editors and rule templates for business users.

Recognized for its ease-of-use and integration, ILOG BRMS adheres to standards such as service-oriented architecture (SOA) and Mortgage Industry Standards Maintenance Organization, Inc (MISMO) XML compliance. As such, companies are able to preserve and enhance existing IT investments, such as legacy platforms, loan origination system (LOS) or point-of-sale (POS) portals.

Out of the box, ILOG BRMS provides:

• Seamless integration—With IT tools and development processes, including SOA, XML, MISMO, Java/J2EE, .NET and Eclipse/Visual Studio
• Easy, Web-based rule management—For business users with wizards, templates and point-and-click simplicity
• Complete operations control—For testing, deployment, versioning and performance monitoring for operations management
• Easy integration with and ability to modernize legacy platforms and enhance IT investments—Such as loan origination systems (LOS), point-of-sale (POS) portals, business process management (BPM) or enterprise content management (ECM) platforms
• Improved control and compliance monitoring—Including built-in auditability, traceability and impact analysis capabilities

What level of product support do you provide?
We offer three primary service models:

• The quick-start product training and consulting model: We provide training and high-level consulting services to assist with your initial project design and requirements.
• The collaboration model: This is the model we recommend, as it provides the highest level of value; we work with your teams to co-develop the right solution for you.
• The full solution implementation model: We perform a majority of the work with guidance from your teams. This model is ideal when there is a tight schedule, limited availability of customer resources, and/or a risk-averse environment.

What are the typical issues you have encountered with previous implementations of ILOG BRMS, and how were they resolved?
Two of the more common issues we have encountered are:

• Lack of customer experience with business rule management systems
  In addition to focusing on solution development, we dedicate time to train and mentor your teams how to best use our products and rule development best practices. We strive to ensure that your team is fully capable of maintaining, enhancing, and extending the system we develop with you.
• Weak business object model (BOM) design
  A well-designed BOM makes rule development a much simpler task and ensures that the system is robust and flexible enough to support future changes. Our business policy consultants focus on ensuring a well-designed BOM through analyses of business policy documents and processes, and through interviews with key business personnel.

How long has ILOG JRules been on the market?
We have been delivering market-leading rules technology since 1987; we released ILOG JRules 6.7 in February, 2008.

How often do you release new (major and minor) versions of ILOG JRules?
We typically release one major release and three to four minor releases per year.

How does ILOG BRMS serve financial customers and increase customer satisfaction?
ILOG BRMS treats rules as a corporate asset: instead of simply updating rules when conditions change, ILOG BRMS empowers business users to manage rules throughout the lifecycle of the application. This helps you anticipate changes in demand, regulations and competitive activities, converting these challenges into advantages such as flexible product offerings, pricing and services that generate incremental revenue streams.

Does ILOG BRMS offer what-if or impact analyses and how do you deal with testing and simulation?
You can make simulations and what-if scenarios with the ILOG JRules Rule Scenario Manager (RSM) module. ILOG JRules RSM provides a facility for testing rules over selected input data, comparing them with known or expected results. Scenarios can be executed individually, in suites, or as collections of suites that form a simulation. Scenarios are defined in terms of input data, baseline reports and result-test criteria.

Can your decision-engine test policy change prior to implementation?
Yes. Testing is best done by deploying and executing policies tagged for testing in a testing environment. ILOG JRules Rule Scenario Manager (RSM) can execute both changed and unchanged policies in parallel and provide a detailed report of the different execution results. If testing is successful, the policies can be tagged for deployment and then be deployed to production.

What are the reporting capabilities of the decision engine when a new policy is tested?
ILOG JRules Rule Scenario Manager (RSM) can generate reports in Excel, XML or HTML. The reports are highly customizable and would typically show input and output data, test results such as rules fired, in which order, etc.

Does ILOG BRMS support the .NET platform?
Yes, ILOG Rules for .NET provides enterprise business rule management capabilites in a native .NET environment. ILOG and Microsoft have collaborated to upgrade, expand and promote the integration of ILOG Rules for .NET within Microsoft desktop and enterprise products, including Office 2007, BizTalk Server 2006 R2, Windows SharePoint Services, Visual Studio, .NET 3.0 and Windows Workflow Foundation.