Interview Questions for Business Analysts and Systems Analysts


Recent Interview Questions | Search | Subscribe (RSS)

?
INTERVIEW QUESTION:

What is a business rule and how does it differ from a business requirement?

Posted by Chris Adams

Article Rating // 18728 Views // 0 Additional Answers & Comments

Categories: Business Analysis, Business Rules

ANSWER

What is the difference between a business rule and a business requirement. Let's begin with a provocative statement. Maybe it doesn't really matter that much. And in reality, not identifying a particular business requirement as a business rule won't have a huge impact on a business.  Let's be clear, missing a business requirement altogether can have tremendous impact. But simply labeling a business rule as a business requirement will not. So, take a deep breath and relax.

Still there is a lot of confusion around business rules versus business requirements.  Understanding the difference between the two can help a business realize certain benefits and efficiencies by managing business rules and business requirements separately.  It can, however, be difficult to differentiate between the two especially when reading each as a textual statement without the necessary context surrounding it.

What are business rules?

Business rules often tell you whether you may or may not do something. They may also be the input criteria used for making more complex business decisions that will ensure compliance throughout the business. Business rules can apply to individuals, general corporate behavior, or business processes.

Business rules often originate from government or industry regulations. These are easy to identify. Businesses have little control over them but they change infrequently. In fact most business rules are fairly static. By managing them (often with a Business Rules Management System), businesses can gain increased efficiencies, agility, and the ability to adapt quickly to changing environmental factors. By simply adjusting a value within an encapsulated business rule referenced by an existing process or system, the business can alter how it responds to the surrounding environment.
 
While many business rules originate outside of the business, others originate internally. These rules can be harder to identify. They can me more evident if they are policies passed down from high within the organization or from an HR or Compliance department.  They also are easier to identify when they are clear inputs into decisioning logic. When decisions have to be made, business rules are involved. Business rules help inform business policies, the creation of business processes, and the creation of business systems. 

How business requirements relate to business rules.

Business requirements are used to implement business rules. They ensure compliance with the business rules. Therefore, if a business rule changes, your business requirements will be impacted and need to change also. 

More practically speaking, business rules ARE business requirements, though not all business requirements are business rules. This is similar to how a square is a rectangle but a rectangle is not a square.  We choose to label and refer to a square with its special name, but it doesn't cease being a rectangle. Similarly, we label business rules as a special type of business requirement, but they don't cease being a business requirement. 

Some industry leaders may disagree with this more practical approach. An esoteric argument can be made that business rules exist whether they have been implemented by a business requirement or not. That's fine, and is technically true. A business rule could be generally known throughout the business, but never codified or implemented by a business requirement.  How or why would this happen? Maybe the business has decided that the cost of implementing the known rule within a business process or system would be costly and the business risk and impact associated with not following the rule is relatively low.  In this case, no business requirement exists to implement the rule. But in a sense, the rule doesn't really exist except in the most theoretical sense or unless the business is really good about tracking all business rules including those never implemented (doubtful).

Business rules (the special type of business requirement), and business requirements are both hierarchical in nature.  A more general rule or requirement can be broken down into more specific rules and requirements that more fully describe them.  

It's also feasible that more than one set of business requirements could implement the same business rule, just in a different manner.  Just as you can have many different options for a system design that meet the needs of the business requirements, many different and valid business requirements could feasibly implement the same business rules. This is one litmus test for whether something is a business requirement versus a business rule.  The business would not suddenly change a business rule without a significant impetus. Whereas, the business may decide that there is a better choice of business requirement.


Example:

Business Rule: You must be 21 or older to view the alcohol product website.

The business may choose to implement and comply with this rule in a number of ways. Each may have different levels of associated risk to the business based on how fully compliance with the rule is enforced.
 
(Option 1) Business Requirement: The user shall provide a birthdate as proof of their age.
(Option 2) Business Requirement: The user shall provide a valid drivers license as proof of their age.  

Option 2 might increase the likelihood of compliance with the business rule, but it would require additional business requirements and  business rules to define how the business determines the provided license is acceptable. Is an expired license sufficient enough to comply with the original business rule?

--
Chris Adams
LinkedIn Profile

RATE THIS TOPIC

ADDITIONAL ANSWERS / COMMENTS

Only registered users may post comments.

Do your homework prior to the business analysis interview!

Having an idea of the type of questions you might be asked during a business analyst interview will not only give you confidence but it will also help you to formulate your thoughts and to be better prepared to answer the interview questions you might get during the interview for a business analyst position.  Of course, just memorizing a list of business analyst interview questions will not make you a great business analyst but it might just help you get that next job.

 



 




Select ModernAnalyst Content

Register | Login

Copyright 2006-2024 by Modern Analyst Media LLC