Imagine increasing efficiency, decreasing mistakes, and gaining insight into your business. Learn about the benefits of business process automation in this video.

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What is BUSINESS RULE? What does BUSINESS RULE mean? BUSINESS RULE meaning - BUSINESS RULE definition - BUSINESS RULE explanation.

Source: Wikipedia.org article, adapted under https://creativecommons.org/licenses/by-sa/3.0/ license.

A business rule is a rule that defines or constrains some aspect of business and always resolves to either true or false. Business rules are intended to assert business structure or to control or influence the behavior of the business. Business rules describe the operations, definitions and constraints that apply to an organization. Business rules can apply to people, processes, corporate behavior and computing systems in an organization, and are put in place to help the organization achieve its goals.

For example, a business rule might state that no credit check is to be performed on return customers. Other examples of business rules include requiring a rental agent to disallow a rental tenant if their credit rating is too low, or requiring company agents to use a list of preferred suppliers and supply schedules.

While a business rule may be informal or even unwritten, documenting the rules clearly and making sure that they don't conflict is a valuable activity. When carefully managed, rules can be used to help the organization to better achieve goals, remove obstacles to market growth, reduce costly mistakes, improve communication, comply with legal requirements, and increase customer loyalty.

Business rules tell an organization what it can do in detail, while strategy tells it how to focus the business at a macro level to optimize results. Put differently, a strategy provides high-level direction about what an organization should do. Business rules provide detailed guidance about how a strategy can be translated to action.

Business rules exist for an organization whether or not they are ever written down, talked about or even part of the organization's consciousness. However it is a fairly common practice for organizations to gather business rules. This may happen in one of two ways.

Organizations may choose to proactively describe their business practices, producing a database of rules. While this activity may be beneficial, it may be expensive and time-consuming. For example, they might hire a consultant to comb through the organization to document and consolidate the various standards and methods currently in practice.

More commonly, business rules are discovered and documented informally during the initial stages of a project. In this case the collecting of the business rules is incidental. In addition, business projects, such as the launching of a new product or the re-engineering of a complex process, might lead to the definition of new business rules. This practice of incidental, or emergent, business rule gathering is vulnerable to the creation of inconsistent or even conflicting business rules within different organizational units, or within the same organizational unit over time. This inconsistency creates problems that can be difficult to find and fix.

Allowing business rules to be documented during the course of business projects is less expensive and easier to accomplish than the first approach, but if the rules are not collected in a consistent manner, they are not valuable. In order to teach business people about the best ways to gather and document business rules, experts in business analysis have created the Business Rules Methodology. This methodology defines a process of capturing business rules in natural language, in a verifiable and understandable way. This process is not difficult to learn, can be performed in real-time, and empowers business stakeholders to manage their own business rules in a consistent manner.

Gathering business rules is also called rules harvesting or business rule mining. The business analyst or consultant can extract the rules from IT documentation (like use cases, specifications or system code). They may also organize workshops and interviews with subject matter experts (commonly abbreviated as SMEs). Software technologies designed to capture business rules through analysis of legacy source code or of actual user behavior can accelerate the rule gathering processing.