Business Rules : An Elixir for a Thriving Business

Know Different Types of Business Rules


Business rules can be used and defined in various attributes of the organization. Let us first understand what are business rules. Generally, business rules define a specific set of instructions or constraints concerning how certain daily operations can be executed. When the business rules are individually outlined from process implementations, they offer a flexible and powerful approach that helps organizations quickly achieve their business goals, thereby responding faster to growing business needs.

Why Are Business Rules Important?

  • Any business should have a set of business rules to ensure that its operations run smoothly across its different segments irrespective of its reputation, niche market, and size. Business rules help an organization sustain order by guiding its employees to conduct practical business activities when adhering to corporate policies.
  • Business rules are extended versions of business policies developed to accomplish more business goals. The absence of clear business rules within an organization can lead to chaos and disorder among the processes and wrong decisions that might hinder business growth. 
  • Even though there are no fixed standards for drafting business rules, adhering to fundamentals that align with business rules can significantly help. Further, it would be best if other companies’ rules were not adopted; instead, companies should identify their business rules for better prospects.
  • Additionally, businesses should ensure that their companies comply with government regulations. Although business rules define their specific business actions, they place limitations not required by the industry. The company can develop business rules either in an informal, formal, automated, or written form.

Types of Business Rules

Business rules are a specific set of guidelines that explains how businesses should operate in a given situation. Here are the different types of business rules.

  • Action Assertion: It is a set of constraints where the various aspects of any business-based action can be controlled.
  • Derivation – Extracting data from other sources of business information.
  • Structural Assertion – It refers to a business’s structure that determines how a decision can be defined.

              Within the assertions, rules are further defined as one of three types 

  1. Decision rule – A decision rule is used when an action needs to be approved, reviewed, or rejected before proceeding with the next step.
  2. Qualification/disqualification rule can be used when a plan needs to be filtered as qualified or disqualified and prevents misused time and effort.
  3. Coordination rules – These rules present a set of conditions to be met for a process to advance without re-work.

Scope :

Business rules have extensive applications covering a broad range of verticals and industries. Any process, workflow, or task within the company – either handled by manual labor or automation or a combination of two, can benefit from using business rules. For instance,

  • Business rules help gather the appropriate signatures for paper works or contracts to help human resources during the employee onboarding process. It also helps in managing paperwork and more complex arrangements that are related to business processes.
  • It can be used to deliver product recommendations to their online clients. This can be done using an algorithm or complex calculation used on shopping history data to display personalized offers to their online customers.
  • Lending and finance companies can utilize business rules for their financial products or automated financial tools to adjust interest rates depending on their customer’s terms. Business rules help in adding or eliminating the workflow processes depending on the individual needs.

How to achieve your organization’s objectives using business rules?

  • Implementing the business rules in place will help check the limitations that can be eliminated quickly and control the business processes effectively. Executing business rules helps to strengthen the process and achieve more productivity and efficiency.
  • Business rules can be utilized to minimize losses while increasing profitability. It ensures that the company standards have been incorporated and business goals are promptly fulfilled.
  • Business rules guide how a business process needs to be conducted, and all expectations need to be completed. It also helps the company to meet the compliance standards to ensure regulatory requirements are set. It can stabilize conflict resolution, safety protocols and assist in preventing potential litigation. 

Final Thoughts

The latest advancement in technology knows no bounds for raising a workplace’s productivity and efficiency. Still, companies should understand that technology provides only a fraction of the solution and should adhere to business rules and processes required to manage it. Business rules can make it possible to handle a large organization, thereby magnifying efficiency and curbing obstacles.

Richard Gallagher

Richard Gallagher has more than a decade of experience in writing. He started as a general news reporter before moving to FinanceStead's team as a financial news writer. He is passionate about stock trading. He also loves to travel a lot.

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