Decision management, also known as enterprise decision management (EDM) or business decision management (BDM) entails all aspects of designing, building and managing the

automated decision-making Automated decision-making (ADM) involves the use of data, machines and algorithms to make decisions in a range of contexts, including public administration, business, health, education, law, employment, transport, media and entertainment, with var ...

systems that an

organization An organization or organisation (English in the Commonwealth of Nations, Commonwealth English; American and British English spelling differences#-ise, -ize (-isation, -ization), see spelling differences), is an legal entity, entity—such as ...

uses to manage its interactions with customers, employees and suppliers. Computerization has changed the way organizations are approaching their decision-making because it requires that they automate more decisions, to handle response times and unattended operation required by computerization, and because it has enabled "information-based decisions" – decisions based on analysis of historical behavioral data, prior decisions, and their outcomes.

Overview

Decision management was described in 2005 as an "emerging important discipline, due to an increasing need to automate high-volume decisions across the enterprise and to impart precision, consistency, and agility in the decision-making process". Decision management is implemented "via the use of rule-based systems and analytic models for enabling high-volume, automated decision making". Organizations seek to improve the value created through each decision by deploying software solutions (generally developed using BRMS and

predictive analytics Predictive analytics encompasses a variety of statistical techniques from data mining, predictive modeling, and machine learning that analyze current and historical facts to make predictions about future or otherwise unknown events. In busine ...

technology) that better manage the tradeoffs between precision or accuracy, consistency, agility, speed or decision latency, and cost of decision-making within organizations. The concept of decision yield, for instance, focuses on all five key attributes of decision-making: more targeted decisions (precision); in the same way, over and over again (consistency); while being able to adapt "on-the-fly" (

business agility Business agility refers to rapid, continuous, and systematic evolutionary adaptation and entrepreneurial innovation directed at gaining and maintaining competitive advantage. Business agility can be sustained by maintaining and adapting the goods an ...

) while reducing cost and improving speed, is an overall metric for how well an organization is making a particular decision. Organizations are adopting decision management technology and approaches because they need a higher return from previous infrastructure

investments Investment is the dedication of money to purchase of an asset to attain an increase in value over a period of time. Investment requires a sacrifice of some present asset, such as time, money, or effort. In finance, the purpose of investing is ...

, are dealing with increasing business decision complexity, face competitive pressure for more sophisticated decisions and because increasingly short windows of competitive advantage means that the speed of business is outpacing speed of

information technology Information technology (IT) is the use of computers to create, process, store, retrieve, and exchange all kinds of Data (computing), data . and information. IT forms part of information and communications technology (ICT). An information te ...

to react. Other terms used include "intelligent process automation" (where decision management is combined with

business process management Business process management (BPM) is the discipline in which people use various methods to discover, model, analyze, measure, improve, optimize, and automate business processes. Any combination of methods used to manage a company's business p ...

Approach

There are a number of different approaches used to apply decision management principles. In general, these follow three steps: # Decision identification and

decision model A decision model in decision theory is the starting point for a decision method within a formal (axiomatic) system. Decision models contain at least one action axiom. An action is in the form "IF is true, THEN do ". An action axiom tests a condi ...

ing using either open standards such as

Decision Model and Notation In business analysis, the Decision Model and Notation (DMN) is a standard published by the Object Management Group.OMG standard "Decision Model and Notation (DMN)"current version/ref> It is a standard approach for describing and modeling repeatable ...

or proprietary approaches such as The Decision Model # Development of a system or service (often called a Decision Service) that automates all or part of the decision # Ongoing monitoring and management of the decision to keep the business rules and

machine learning Machine learning (ML) is a field of inquiry devoted to understanding and building methods that 'learn', that is, methods that leverage data to improve performance on some set of tasks. It is seen as a part of artificial intelligence. Machine ...

models used up to date Decision management often involves the use of

A/B testing A/B testing (also known as bucket testing, split-run testing, or split testing) is a user experience research methodology. A/B tests consist of a randomized experiment that usually involves two variants (A and B), although the concept can be al ...

and

experimentation An experiment is a procedure carried out to support or refute a hypothesis, or determine the efficacy or likelihood of something previously untried. Experiments provide insight into cause-and-effect by demonstrating what outcome occurs when a ...

as well.

References

{{reflist Management by type Decision theory

Overview

Approach

See also

References