We use cookies and other similar technologies (Cookies) to enhance your experience and to provide you with relevant content and ads. By using our website, you are agreeing to the use of Cookies. You can change your settings at any time. Cookie Policy.


Blog: James Taylor Subscribe to this blog's RSS feed!

James Taylor

I will use this blog to discuss business challenges and how technologies like analytics, optimization and business rules can meet those challenges.

About the author >

James is the CEO of Decision Management Solutions and works with clients to automate and improve the decisions underpinning their business. James is the leading expert in decision management and a passionate advocate of decisioning technologies business rules, predictive analytics and data mining. James helps companies develop smarter and more agile processes and systems and has more than 20 years of experience developing software and solutions for clients. He has led decision management efforts for leading companies in insurance, banking, health management and telecommunications. James is a regular keynote speaker and trainer and he wrote Smart (Enough) Systems (Prentice Hall, 2007) with Neil Raden. James is a faculty member of the International Institute for Analytics.

Copyright © 2009 James Taylor. Visit the original article at Using decision management to manage risk.

The Forrester Blog For Information & Knowledge Management Professionals had a nice post on The Growing Importance Of Enterprise Risk Management. One of the key points was this one:

2) They will focus on driving risk management into business decisions. Risk management is not new. Enterprises have internal auditors, Chief Risk Officers, and others responsible for risk identification and management. However most of those I spoke with noted they were not as effective at driving risk management into business decisions, performance metrics were not often compared with risk metrics.

This makes a couple of key points. Firstly it points out that risk management must be driven into every business decision - operationalized if you will. Secondly it correctly points out the importance of performance metrics and risk metrics.

Decision management is critical to managing risk given these two issues. Why?

  1. Decision management uses business rules management to automate operational decisions in Decision Services. This allows the rules (policies, regulations) that have been adopted to manage risk to be pushed into every operational decision in every business process.
  2. These Decision Services are the ideal leverage point for analytics, allowing predictive analytic models (of risk) and the results of data mining to be applied to these same operational decisions.
  3. Decisions can and should be mapped both to risk metrics and to performance metrics. Knowing which decisions impact which performance measures and which risk metrics is essential if you are to manage risk systematically across your business processes.

As organizations start thinking more holistically and systematically about risk they need to also think more systematically about decisions.

This whole issue of mapping decisions to performance measures is one I am going to blog on more.


Posted January 13, 2009 4:25 AM
Permalink | No Comments |