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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.

April 2009 Archives

SESRussian.PNG Well it finally happened - Neil and I became internationally published authors! Check out this link and what you see is a Russian version of Smart (Enough) Systems, the book on Decision Management we published a little while back. If any of my readers are Russian speakers and get hold of a copy in the coming weeks, please let me know. It would be fun to hear from someone who read it in a different language.

The title of this post, by the way, comes from the Yahoo Babel Fish translation of the Russian

Sorry for the lack of posts this week, been a busy week one way and another.

Posted April 30, 2009 8:52 PM
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This headline came from a briefing I got from LucidEra about their spring release and was so good I just had to use it. Think about it - if all a dashboard does is stress you out and raise your blood pressure by telling you what's wrong without giving you any help as to how to fix it then it is not much use. You must know what decisions can and should be made and think about how you can help the user of that dashboard make the right decision and make it fast.

This was the #1 principle in Tom Davenport's piece on the new BI back in December. He listed 10 prinipcles of which the first two were:

  1. Decisions are the unit of work to which BI initiatives should be applied.
  2. Providing access to data and tools isn't enough if you want to ensure that decisions are actually improved.
This thread, this idea that BI must focus on decisions, also came up in a piece written by two of Gartner's smartest analysts - Kurt Schlegel and Gareth Herschel - called "Business Intelligence and Decision Making". This paper was one of Gartner's Strategic Planning Assumptions and the (free) summary says:

A subset of organizations that seek a competitive advantage will evolve the primary role of their business intelligence and performance management initiatives to ensure that decision making is made a core competency across the company (my emphasis).

When I participated in IBM's launch of their BAO (Business Analytics and Optimization) service line (see this BusinessWeek article for a summary) it was clear that this organization is very focused on decisons and on moving from a fairly passive "decision support" mindset to a more proactive "action support" mindset.

The first step is to focus BI and dashboard development on decisions and this means identifying the decisions that your users must make, the questions to which they need answers, and then focusing on these like a laser. Data quality, data integration, timeliness should all be driven by the decision's needs. This can be a challenge for companies and is one I often spend a lot of time on when I work to help them improve their use of analytics.

By the way, I blogged about LucidEra before and hoped they would keep moving towards this idea of acting not just informing. Glad to see them moving along the path that everyone should be following - focused on the decisions to be made and on making it easier (and perhaps automatic) to make them.

Posted April 23, 2009 5:43 PM
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I participated in a panel at IBM's launch of its new Business Analytics and Optimization service line this week. I wrote a quick post to go with the launch and having attended and heard the IBM folks talk about it and had a chance to talk with some of them I thought a longer post was in order.

The core premise that the enterprise of the future is instrumented. interconnected and intelligent. This enterprise needs to make smarter decisions faster and to understand and be able to optimize those decisions ahead of time. It must be able to tell the consequences of a decision in advance (be predictive) and it needs to generate new insights into opportunities and threats from existing data while taking advantage of new data sources.

IBM feels, and I agree, that the current business climate, the explosion of new data source and the growing fear of blind spots combine to make a fundamental shift towards fact-based, directive action support systems and to a new kind of company that puts information to work in a culture of fact-based decisioning. Delivering these kinds of systems takes an understanding of a company/industry software (for information management and decision management) as well as advanced analytics and optimization.

These companies need to make smarter decisions for optimized performance and IBM talked about them moving to "perceive, predict, perform" so they can react faster and react correctly. I like to think of this as a move from a "those who know first win" mentality to a "those who act first win, providing they act intelligently" one. The focus on acting fast not just knowing is critical.

IBM sees three main focus areas for their worldwide offering - advanced customer insight, risk and fraud and analytics and data optimization. Of these the first two obviously match with the most common applications of decision management and both are critically focused on micro decisions. Risk and fraud happen one transaction at a time and customers are treated one at a time - focusing the analytics on these micro decisions will be critical for IBM to succeed in these areas.

IBM sees the pillars of this new approach and its Business Analytics and Optimization service line as Strategy/Road Map, Business Intelligence/Performance Management, Advanced Analytics, Enterprise Information Management and Enterprise Content Management. Of course I would add Decision Management to this list and point to the WebSphere stack with its recent inclusion of ILOG's BRMS as a critical component too. The platform cannot just support information management and information analysis it must also deliver decision making to the front line and nothing is better for that than a Business Rules Management System. Indeed right at the end of the event IBM made the point that many of the systems that will be delivered under the auspices of the BAO service will include analytics and optimization but in a way that the user of the system is not aware of the complexity - decision management applications in other words.

From a business perspective IBM was very clear that this is not just a consulting play but involved research and software in a tight partnership. This is crucial as pulling the pieces together takes consulting work but new data and new algorithms require the research folks and delivering it at scale requires software. They also see this as becoming pervasive across the IBM practice areas like CRM and supply chain. And, in case you were wondering, this did not "just happen" - IBM has clearly been incubating this a while with groups like the Center for Business Optimization and client engagements around analytics.

One final note. IBM talked a lot about an information agenda and a need to manage information as a strategic asset - not using data or information application by application but as an enterprise asset. I would go further and talk about a decision making agenda and decisions and decision making as an asset.

I think this is an interesting development and I look forward to seeing how IBM delivers and evolves this service, particularly around decision management. BusinessWeek ran a nice little article on this too.

Posted April 15, 2009 9:24 AM
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TDWI had an interview with Michael Corcoran of Information Builders recently - Q&A: Pushing BI Beyond Business Managers: TDWI in which he had a great phrase:
"Information can have a dramatic, positive behavioral effect when it is directly available"
I am not familiar with the WebFOCUS platform - if anyone from Information Builders wants to set up a briefing for me that would be great - but from what Michael says it seems to me that a platform like WebFOCUS would get companies well down the road to managing operational decisions.

The keys to success would be a couple of things:
  • Can you identify the decisions that matter and focus on them?
  • Can you change your thinking from "this is the data I have, who needs it?" to "these are the decisions we must improve, what data would help?"
  • Can you integrate analytic insight with regulations and policies - put business rules and analytics together, in other words?
  • Can you focus you analytic effort on predicting the future not reporting on the past?
  • Can you automate as much, or as little, of the decision as makes sense?
If you can then I, like Michael, think your information can have a dramatic and positive effect. Decision management is about putting your data to work and it seems to me that Michael is focusing on that same objective.

Posted April 8, 2009 10:00 PM
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It can sometimes be lonely being a proponent of a big new idea like decision management. It is delightful, then, when you find out that you are less alone than you expected. Last week I came across a couple of white papers from Ventana Research - Extending BI to Support Operational Decision Management and Improving Operational Performance through Decision Management. The first of these has a great paragraph that summarizes one of the major challenges I see in this space (my emphasis):
While many examples of deployed automated decision systems exist, many business managers still do not fully understand or trust them. This is partly because of commonly held but narrow definitions of BI, and partly because of a lack of understanding of how to deploy automated decision making systems.

Mark nails this one - the narrow definition of BI as a way to deliver information to people (presumably so those people can make better decisions) makes it hard for "BI people" to see the power of decision management. This was the prompt for my post To Hell with Business Intelligence, try Decision Management and my article First Steps To and Beyond Operational Business Intelligence. Mark also lists some characteristics of organizations/decisions that will benefit from the decision management approach. Both papers are worth checking out. If you want a thorough exploration of the whole topic, check out the book I wrote with Neil Raden Smart (Enough) Systems - you can buy it from amazon.com.

Posted April 6, 2009 8:14 AM
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