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Decision Management Systems Part One Decision Discovery Slide 1 Decision Management Systems Part One Decision Discovery Slide 2 Decision Management Systems Part One Decision Discovery Slide 3 Decision Management Systems Part One Decision Discovery Slide 4 Decision Management Systems Part One Decision Discovery Slide 5 Decision Management Systems Part One Decision Discovery Slide 6 Decision Management Systems Part One Decision Discovery Slide 7 Decision Management Systems Part One Decision Discovery Slide 8 Decision Management Systems Part One Decision Discovery Slide 9 Decision Management Systems Part One Decision Discovery Slide 10 Decision Management Systems Part One Decision Discovery Slide 11 Decision Management Systems Part One Decision Discovery Slide 12 Decision Management Systems Part One Decision Discovery Slide 13 Decision Management Systems Part One Decision Discovery Slide 14 Decision Management Systems Part One Decision Discovery Slide 15 Decision Management Systems Part One Decision Discovery Slide 16 Decision Management Systems Part One Decision Discovery Slide 17 Decision Management Systems Part One Decision Discovery Slide 18 Decision Management Systems Part One Decision Discovery Slide 19 Decision Management Systems Part One Decision Discovery Slide 20 Decision Management Systems Part One Decision Discovery Slide 21 Decision Management Systems Part One Decision Discovery Slide 22 Decision Management Systems Part One Decision Discovery Slide 23 Decision Management Systems Part One Decision Discovery Slide 24 Decision Management Systems Part One Decision Discovery Slide 25 Decision Management Systems Part One Decision Discovery Slide 26 Decision Management Systems Part One Decision Discovery Slide 27 Decision Management Systems Part One Decision Discovery Slide 28 Decision Management Systems Part One Decision Discovery Slide 29 Decision Management Systems Part One Decision Discovery Slide 30 Decision Management Systems Part One Decision Discovery Slide 31 Decision Management Systems Part One Decision Discovery Slide 32 Decision Management Systems Part One Decision Discovery Slide 33 Decision Management Systems Part One Decision Discovery Slide 34 Decision Management Systems Part One Decision Discovery Slide 35
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Decision Management Systems Part One Decision Discovery

Based on multiple client engagements, How to Build Decision Management Systems introduces our phased approach to building information systems that improve the effectiveness and efficiency of business operations.

“Part One - Decision Discovery” introduces the first step in successfully building Decision Management Systems, how to discover and model the right decisions. The webinar recording is available on our Omnovia channel.

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Decision Management Systems Part One Decision Discovery

  1. 1. How to build Decision Management James Taylor Systems CEO Decision Discovery
  2. 2. Your presenter – James Taylor CEO of Decision Management Solutions Works with clients to improve their business by applying analytic technology to automate & improve decisions Spent the last 9 years developing the concept of Decision Management © Decision Management Solutions, 2011 1
  3. 3. Decision Management Systems Introduced
  4. 4. A changing world Changing Scale Changing Expectations Changing Interactions ©2011 Decision Management Solutions 3
  5. 5. What are Decision Management Systems? Agile Analytic Adaptive ©2011 Decision Management Solutions 4
  6. 6. Decision Management Systems… Keep the Are decision in transparent mind and agile Are Test, learn, predictive and improve not reactive ©2011 Decision Management Solutions 5
  7. 7. 3 Steps to Decision Management Discover Build Improve ©2011 Decision Management Solutions 6
  8. 8. Decisions
  9. 9. Decisions Making choices or selections and taking action ©2011 Decision Management Solutions 8
  10. 10. Different kinds of decisions Strategic Decisions • Few in number, large impact • Should we acquire this company or exit this market? Tactical Decisions • Management and control, moderate impact • Should we re-organize this supply chain, change risk management approach? Operational Decisions • Day-to-day decisions that affect one transaction or customer • Best offer for this customer ?How risky is this loan? Is this claim fraudulent? ©2011 Decision Management Solutions 9
  11. 11. Suitable decisions Repeatable Non trivial Measurable Candidate for business automation impact ©2011 Decision Management Solutions 10
  12. 12. Operational decisions are key ©2011 Decision Management Solutions 11
  13. 13. Decisions implement strategy ©2011 Decision Management Solutions 12
  14. 14. Decisions are the focal point for risk Risk is not acquired in “big lumps” but one transaction at a time ©2011 Decision Management Solutions 13
  15. 15. Decisions maximize customer value ©2011 Decision Management Solutions 14
  16. 16. Decisions scale for large impact Strategic Decision Tactical Decision Operational Decision ©2011 Decision Management Solutions 15
  17. 17. Different types of operational decision Eligibility Validation Calculation Risk Fraud Opportunity ©2011 Decision Management Solutions 16
  18. 18. Three kinds of analytic decisions Risk Fraud Opportunity ©2011 Decision Management Solutions 17
  19. 19. Discovering Decisions
  20. 20. A simple process Age<21 No Class I or II sports Accept low-risk applicant Class II sport Previous Heart Attack, Existing Cancer Decline high-risk applicant 21<=Age<50 Class I sport Process medium-risk Good Medical Record applicant Age>50 1 or fewer Claims Multiple Claims New Customer … Long-standing Customer ©2011 Decision Management Solutions 19
  21. 21. The same process with a decision Low risk Process low-risk applicant Medium risk Determine applicant Process medium-risk type applicant High risk Process high-risk applicant ©2011 Decision Management Solutions 20
  22. 22. Candidate decisions Determine if a customer is eligible for a benefit Validate the completeness of an invoice Calculate the discount for an order Assess the risk of a transaction Select the terms for a loan Choose which claims to Fast Track These are decision words The system must answer a question each time ©2011 Decision Management Solutions 21
  23. 23. Target decision-making on KPIs Strategy defines KPIs KPIs measure operations Operational decisions affect KPIs The link between decisions and KPIs is critical ©2011 Decision Management Solutions 22
  24. 24. Decision to KPI mapping KPIs impacted by improvement in decision Customer Customer Losses Retention KPI 5 Churn Service Budget Calls What retention offer should be made? ↑ ↑ ↓ ? What initial price should be offered? ↑ ↑ Should an intervention call be made? ↓ ↓ Decision 3 ? … ©2011 Decision Management Solutions 23
  25. 25. Define decisions Name Repeatability One-off Continuous Description Measurability Poor Specific Time to value A question Immediate Delayed A defined set of allowable Degrees of answers Freedom Few Many Value Range Any other results to be Narrow Gap Wide Gap returned with the answer Timeliness Slow Real-Time Volume Key facts like volume, Few Many complexity, latency ©2011 Decision Management Solutions 24
  26. 26. Decompose the decisioning What is required to make decision? Guidelines, policy documents Human expertise Regulations Existing system logic Data describing the case External reference data The results of other decisions ©2011 Decision Management Solutions 25
  27. 27. Decision decomposition example Can this customer buy this What is the price of this service? service? Customer Profile Is the service available where this customer lives? Promotions Is there capacity on this Is the customer eligible for Pricing rules service? this service? Geographical Availability Eligibility rules Capacity and Usage Purchase propensity What is the best up sell/cross- sell for this customer? Is there an additional service? What similar service is this customer eligible for? Is there a compelling replacement service? What services are similar to Which services is the requested service? customer eligible for? Churn risk Product hierarchy ©2011 Decision Management Solutions 26
  28. 28. Prioritization of decisions Difference between good and bad decisions? How many decisions a year? What spend is committed based on them? How well can you measure good v bad decisions? What’s it worth … and to whom? ©2011 Decision Management Solutions 27
  29. 29. Learn More
  30. 30. Decision Management Systems What if you could make your systems active participants in optimizing your business? What if your systems could act intelligently on their own? Decision Management Systems can do all that and more. This book shows how to integrate operational and analytic technologies to create more agile, analytic, and adaptive systems. Available October 20, 2011 For more information about this new release, visit Discount Code: TAYLOR4389 www.ibmpressbooks.com/title/9780132884389 ©2011 Decision Management Solutions 29
  31. 31. Check in for the other webinars How to Build Decision Management Systems Part 1 – Decision Discovery Recording will be available Part 2 – Decision Services October 27, 10am Pacific Part 3 – Decision Analysis November 29, 10am Pacific ©2011 Decision Management Solutions 30
  32. 32. Other opportunities to hear me speak SAS Forum Netherlands – October 5, Amsterdam Information Management 2011 – October 12, Copenhagen Predictive Analytics World – October 18, New York eMetrics – October 19, New York Information on Demand – October 24-26, Las Vegas Building Business Capability – October 31-November 1, Miami ©2011 Decision Management Solutions 31
  33. 33. Questions?
  34. 34. Begin with the Decision in mind Discover Build Improve Find the decisions that matter to your business and model them ©2011 Decision Management Solutions 33
  35. 35. Thank You James Taylor, CEO james@decisionmanagementsolutions.com 34
  • roygouck

    Feb. 20, 2016

Based on multiple client engagements, How to Build Decision Management Systems introduces our phased approach to building information systems that improve the effectiveness and efficiency of business operations. “Part One - Decision Discovery” introduces the first step in successfully building Decision Management Systems, how to discover and model the right decisions. The webinar recording is available on our Omnovia channel.

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