Decision management

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Decision management refers to the process of designing, building, and managing automated decision-making systems that support or replace human decision-making in organizations. [1] It integrates business rules, predictive analytics, and decision modeling to streamline and automate operational decisions. [1] These systems combine business rules and potentially machine learning to automate routine business decisions [1] and are typically embedded in business operations where large volumes of routine decisions are made, such as fraud detection, customer service routing, and claims processing. [1]

Contents

Decision management differs from decision support systems in that its primary focus is on automating operational decisions, rather than solely providing information to assist human decision-makers. It incorporates technologies designed for real-time decision-making with minimal human intervention. [2]

Historical background

The roots of decision management can be traced back to the expert systems and management science/operations research practices developed in the mid-20th century. [3] These early systems aimed to replicate human reasoning using predefined logic. As technology advanced, decision management evolved to incorporate data-driven analytics and visual analytics tools. For instance, the Decision Exploration Lab introduced visual analytics solutions to help understand and refine decision logic, streamlining business decision-making. [3] This historical context helps place current decision management strategies within their evolutionary framework.

Operational vs. strategic decisions

A key distinction within decision management is its focus on operational decisions rather than strategic decisions. [4] Operational decisions are typically:

Strategic decisions, in contrast, are generally unique, complex, less structured, and made less frequently by senior management. Decision management primarily targets the automation and improvement of high-volume operational decisions. [4]

Approaches and key components

Modern decision management systems integrate a combination of rule engines, data analytics, and increasingly, AI models. [5] These components help organizations formalize decision logic, improve the quality and speed of decisions, and enhance agility in response to changing business environments.

Key components include:

Modern trends: AI and hybrid decision-making

Artificial Intelligence (AI) is increasingly integrated into decision management, leading to "AI-enhanced hybrid decision management". [5] AI technologies, particularly machine learning, enhance decision-making by enabling systems to: [7] * Learn from vast amounts of data.

Combining AI with established decision modeling standards like DMN facilitates the creation of more sophisticated, dynamic, and context-aware automated decision systems. [5]

Benefits and business drivers

Organizations adopt decision management to achieve several benefits:

Chief Information Officers (CIOs) often drive adoption to overcome challenges associated with outdated or hard-coded rule engines and to empower business users to manage their own decision logic. [8]

Real-world applications

Decision management is applied across various industries to automate operational decisions: [1] [2]

Architecture

Decision management systems frequently utilize a service-oriented architecture where decision logic is encapsulated within distinct "decision services". This architectural pattern, often aligned with frameworks like The Decision Model, [6] advocates for decoupling the business decision logic from the core business processes and application code. This separation enhances maintainability, scalability, and the reusability of decision logic across different applications. [6]

See also

References

  1. 1 2 3 4 5 "What is decision management?". IBM Think Blog. IBM. December 9, 2021. Retrieved March 25, 2025.
  2. 1 2 3 4 5 Taylor, J. (2011). Decision management systems: A practical guide to using business rules and predictive analytics. IBM Press. ISBN   978-0-13-288438-9.
  3. 1 2 Broeksema, B.; Baudel, T.; Telea, A.; Crisafulli, P. (2013). "Decision exploration lab: A visual analytics solution for decision management". IEEE Transactions on Visualization and Computer Graphics. 19 (12): 1972–1981. doi:10.1109/TVCG.2013.130. PMID   24051802.
  4. 1 2 3 Taylor, J. "The role of decision modeling in business decision management". BPMInstitute.org. Retrieved March 25, 2025.
  5. 1 2 3 4 Bork, D.; Ali, S. J.; Dinev, G. M. (2023). "AI-enhanced hybrid decision management". Business & Information Systems Engineering. 65 (2): 179–199. doi: 10.1007/s12599-023-00790-2 .
  6. 1 2 3 4 von Halle, B.; Goldberg, L. (2010). The decision model: A business logic framework linking business and technology. CRC Press. ISBN   978-1420082814 . Retrieved March 31, 2025.
  7. Guemuesay, A. A.; Bode, I.; Spreitzer, G. (2022). "AI and the Future of Management Decision-Making". ResearchGate. Retrieved May 2, 2025.
  8. 1 2 3 "What CIOs want from decision management" (PDF). Sapiens Decision. 2022. Retrieved March 25, 2025.