Business Rules in Government

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Business Rules in Government

• Anthony Bettanin,
• Thursday 10 May 2007
• GOVIS

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My history and background

• I joined SoftLaw (later renamed RuleBurst) in
  1998 at corporate headquarters in Canberra
  because of its social justice focus and
  combination of law IT
• Ive lectured graduate and undergraduate courses
  in law IT at the Australian National University
  in Canberra and Kings College in London
• I worked with many public sector agencies in
  Australia, both federal and state
• Ive spent the last three years based in the
  RuleBurst office in London working predominately
  with HM Revenue Customs
• Ive recently transferred to the RuleBurst office
  in Melbourne to focus on public sector clients in
  Victoria New Zealand

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What is a rules engine? Its a brain!
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Forrester analyst research

• Business rules are
• for defining business logic in non-code format
• automating decisions within processes
• supporting application change by decoupling rules
  from code
• effective for business involvement in
  applications
• Business rules should have the following
  characteristics
• fit integration with standard programming
  models runtimes
• accessibility ease of use for business analysts
• centralised management of rules as an asset
• optimised rules algorithm for performance

• The Forrester Wave Business Rules Platforms, Q1
  2006
• John R. Rymer, January 4, 2006

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The BRMS sector is growing quickly as customers
realise the business benefits
Source IDC 2006
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What exactly is a business rules system?

• A software program designed to mimic the
  knowledge of a human being with expertise in a
  particular area
• A type of artificial intelligence it takes the
  knowledge of a human expert and converts it into
  a computer-generated problem solving tool
• Allows people with varying levels of expertise to
  perform tasks and/or reach conclusions without
  being a specialist in that area
• Unlike a normal software program, a business
  rules system has
• Human reasoning a business rules system
  simulates human reasoning it can apply reasoning
  and reach the same conclusions as a human using
  cognitive thinking
• Knowledge representation the knowledge
  incorporated into a business rules system is
  stored in an area called a knowledge base or
  rulebase. This is separate from the inference
  engine the computer program that applies the
  reasoning
• Uncertainty some business rules systems can
  work with uncertainty, unlike standard computer
  programs that require specific conditions to be
  met. It can reach a conclusion, even where there
  is some aspect that it does not know.

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Rules and SOA
Presentation Layer Display Engine
Look and Feel
Business Process Management Process Engine
Workflow

• Independent coarse-grained service
• Share one set of rules across the enterprise
• Store multiple rule sets in the one server
• Technology-neutral

Enterprise Service Bus Service Orchestration
Orchestration
Database Adaptor
Business Rules Management Rule Server
Decisions
Store
Database
Database
Database
Database
Business Rules
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Centralised Reusable

• Make rules available to all applications in the
  technology stack
• Use business logic consistently across the
  enterprise
• Write once, deploy everywhere
• Reduce maintenance overhead by maintaining one
  set of rules
• Flex the boundaries of the organisation for the
  2010 Web 2.0 vision (more interative self
  service, plus service delivery via third parties
  like Maori trusts, RSL, etc)

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Business Rules in the Public Sector

• In the public sector typical sources of business
  rules are
• Legislation
• Regulations
• Department policies, procedures, handbooks,
  manuals, circulars, memos, interpretations, etc
• Application forms, guides and processes
• Business rules from these sources typically are
  used to provide
• Decision support for customer service
• Assessment and calculation
• Typical features of public sector business rules
  are that they are
• Dynamic and not static
• Owned by the business (eg in the NZ Government
  shared network ownership of rules is retained by
  the primary department so they can provide the
  authoritive source, like the e-benefits project
  in the UK)

Legislation
Regulations
Other policy and business rules
Rent assistance
State Housing
Loans

Special assistance
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Why is a rules engine useful in government?

• Every interaction between a citizen and their
  government is governed by complex rules based in
  legislation and policy
• eg. how much tax should I pay?
• eg. am I eligible to claim this benefit?
• eg. how do I set up and register my new business?
• Government must continually innovate to be able
  to afford service delivery
• There are 3 ways to handle these complex
  interactions/ decisions
• 1. employ rooms full of people trained to make
  the decision but
• People are expensive, and they all require
  detailed training
• They make mistakes, are inconsistent decisions
  are open to challenge
• Normally inefficient and very costly
• 2. write custom code but
• Its normally very difficult, very complex, and
  very expensive to write
• Its difficult, complex, expensive and slow to
  update the code every time the laws, legislation
  and policy change (which they do all the time!)
• Its normally difficult to integrate the custom
  code into other applications
• 3. use business rules!
• Its quick and easy to set up, use and change
• It integrates with existing applications is
  immediately web deployable
• Business owners own the rules

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Who can benefit from business rules software?

• Any public sector organisation or department that
  has any of the following
• A complex, volatile or large legislative and
  policy base
• High risk administrative decision making
• Large volume of claims processing
• Unacceptable levels of inconsistent or inaccurate
  decisions
• A need to provide auditability in decisions
• A high turnover of staff
• A demand for Internet and self service capability
  
• Fast turnaround required for policy changes

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Benefits
EFFICIENCY IMPROVED CUSTOMER SERVICE
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Measuring the ROI

• Faster implementation of Government policy
• Heavy political cost of making errors
• Complexity is hard to explain to constituents

• Automated decision-making (self service)
• Higher Productivity from existing staff
• Reduced errors and appeals
• Massively reduced implementation costs

• Open and transparent decisions
• Understanding the impact of policy change
• Reducing red tape for citizens/businesses

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Political ROI
Pain Points
Business Rules Solution Enablers

• Difficult to change Government Policy
• Policy complexity makes it to hard to get it
  right
• Government would like to be more agile
• Errors are costly in political capital
• Often high profile Government stuff-ups
• In most countries, FOI means the Government
  cannot hide
• Appeals reduce public confidence
• Costs of complexity
• High burden on taxes/fees on citizens/businesses
• Very high administrative costs

• Active policy
• Changes can be made quickly
• Impact of changes is measurable
• Improved accuracy and consistency in decisions
• Increased automation of rule based decision
  making
• Line of reasoning can be explained to the end
  citizen
• Reduction in red tape
• Provide online advice consistent with the
  underlying policy

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Social ROI
Pain Points
Business Rules Solution Enablers

• Accurate, consistent, transparent decisions
• Automated, accurate, consistent decisions
• Discretion is controlled, and decisions can be
  explained easily
• Citizens can self serve
• Test their own circumstances against the same
  policy used by the transactional system
• Intelligent online questionnaires guide the
  citizen through the necessary data to provide a
  result
• Citizen-centric services
• The citizen does not need to know what they are
  looking for, the system will help guide them to
  the correct processes
• Complex processes such as tax social security
  payment/claims can be done online, directly
  linked to CRM/legacy applications
• Empowers end users, increases accessibility (eg
  better off calculator)
• Joined up government, no wrong door!

• Lack of trust in the system
• Inconsistent decisions
• Difficult to explain reasoning behind decisions
• Difficult to work out how does it affect me?
• New/changed policies are poorly understood by
  those they affect
• Online material is typically just static web
  pages and forms
• Difficult to deal with Government
• A lot of red tape (especially for businesses)
• Processes are very rarely citizen-centric
• True e-Government is very difficult because of
  the complexity of the rules

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Compensation and Benefits Case Study
Background
Issue

• Highly critical Auditor General report on the
  administration of veteran disability compensation
  processing
• Lengthy claim process of approximately 6 months
  with only 2 days or so work on each claim
  (Veterans were dying before claims were
  processed)
• Up to 12 staff members involved in processing
  each claim
• Senior staff required to approve each claim
• Legislation allowed subjectivity and discretion
  by assessors
• Assessments were inconsistent and open to appeal

• Department of Veterans Affairs is responsible
  for providing funding to former Australian
  soldiers and those involved in war
• It approves and provides funding for a number of
  purposes, including
• Healthcare
• Pensions
• Home renovations

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Compensation and Benefits Case Study
Solution
Benefits

• RuleBursts technology enabled a comprehensive
  re-engineering of the compensation claims policy
  and process
• Solution delivered a system that guides assessors
  through the rules governing more than 300 medical
  conditions
• System enabled single assessor processing, end to
  end
• Generation of personalised evidence-gathering
  questionnaires tailored to the clients medical
  circumstances and service history
• Determination of eligibility for and rates of
  payments

• 60 more claims processed in 60 less time
• 80 productivity improvements
• Reduction in the number of processing staff by
  one-third
• Decision making delegated to more junior staff
• Reduced reliance on doctors and senior staff
• Reduction in the number of appeals by 30 (cost
  of appeals previously equalled the cost of
  primary decision making)
• Administrative savings greater than 2m per annum

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Business Rules in Government - Case Studies

• Compensation/Benefits Department of Veterans
  Affairs (Australia), Department of Defence
  (Australia), Ministry of Defence (UK)
• Social Services Centrelink (Australia)
• Tax and Revenues HM Revenue and Customs (UK),
  IRS (USA)
• Human Resources NSW Premiers Department
  (Australia)
• Housing Queensland Housing (Australia)
• Immigration Department of Immigration and
  Citizenship (Australia)
• Insurance NSW WorkCover (Australia)
• Grants Management Department of Environment
  (Australia)
• Local Government Queensland Department of Local
  Government (Australia), eBenefits (UK),
• Harmonisation of Laws Estrella (Europe)
• Justice Victorian Department of Justice
  (Australia)
• Aid Program Reduction in admin costs from 60 to
  20

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Benefits summary

• Rapid modelling of rules using a methodology
  designed for statutes, regulations and policy
• Business users maintain rules using familiar
  Microsoft Office tools Word (natural language
  rules), Excel (calculation rules, decision
  tables), Visio (workflow, process rules)
• Traceability between laws, regulations, policy
  and the system implementation
• Ensures up-front compliance
• Ensures accurate and consistent decisions
• Detailed audit reports to explain complex
  automated decisions
• Rapid extension of core enterprise solution
  capability with complex rules
• Can inform analytics and evidence-based reporting

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Anthony Bettanin anthony.bettanin_at_ruleburst.com 6
1 434 832 564