What is a Business Rules Engine? Types, and Benefits

A Business Rules Engine (BRE) allows organizations to define, manage, and execute business rules separately from application code. This simplifies testing and modifications, reduces reliance on developers, and enables faster adaptation to changing requirements.

By using a BRE, you can automate decision-making, enhance operational efficiency, and ensure compliance with laws. It enables rapid adaptation to changing requirements, reduces development time by allowing non-technical users to manage rules, and ensures consistency across processes with automated, rule-based logic.

This article explains what a business rules engine is, the different types, its key benefits, and how it can help improve the way businesses operate.

What is a Business Rules Engine?

A business rules engine (BRE) is a software program that collects, manages, and executes business rules, company policies, operational decisions, facts, and other functions in a runtime production environment using pre-defined logic. It works separately from the main application code and is part of a larger system called the Business Rules Management System (BRMS).

The BRE system allows you to define, organize, and verify rules, check their consistency, and link them to other IT systems when necessary. These rules can be legal or specific to your organization’s policies, enabling automated decision-making and outcome determination. This improves operational accuracy, speeds up development, and ensures compliance, especially in industries with complex dependencies and frequent regulatory changes.

It simplifies testing and modifications, reduces reliance on developers, and enables faster adaptation to changing requirements.

For instance, health insurers, financial institutions, and retailers leverage BRE applications to ensure compliance while onboarding new customers. This helps them eliminate risks and run operations according to changing state and regulatory requirements.

BRE receives data from various sources, including user inputs, sensors, and databases, and formats it according to predefined rules. It executes these rules based on dependencies, priorities, and other factors, generating outputs aligned with organizational and industry standards. The output may include results, actions, product recommendations, or decisions.

BRE utilizes artificial intelligence (AI) and machine learning (ML) to learn from large data sets and make business decisions faster and better.

Core Components of a Business Rules Engine

The core components of the business rules engine work together to streamline your business operations and enhance your productivity. These components are:

Rule Repository

The rule repository acts as a centralized database in BRE where you can store and manage your business rules. It lets you define the operational logic, from business workflows to pricing methods. You can access these rules in various formats, including specific rule languages, decision tablets, and natural languages. This helps you update and modify business rules as per the changes in regulatory requirements and market dynamics.

For example, a hospital can use a rule repository to implement compliance across its branches, lower non-compliance risks, and effortlessly onboard new patients based on predefined logic. 

Runtime Environment

The runtime environment plays an important role in BRE by executing business rules stored in the repository to ensure your operations run efficiently according to the set decision logic. It processes decisions faster in every workload, minimizing downtime. 

For example, a healthcare insurance firm defines rules stored in the repository and executes them in the runtime production environment to adjust onboarding and payment options based on the patient’s health status, insurance policy, and other factors. 

Authoring Interface

BRE’s authoring interface enables domain experts and business analysts to manage and implement business rules even without any technical expertise. BRE applications offer a drag-and-drop feature to define rules straightforwardly, allowing several stakeholders to collaborate simultaneously on creating rules. 

For example, a large-scale retailer uses an authoring interface to define a discount rule (such as 20%) for customers spending more than $200 in a single purchase. 

Integration Capabilities

BRE systems easily integrate with other business systems, including business process management (BPM) software, ERPs, third-party APIs, CRM platforms, etc. This facilitates data exchange with external systems, so you can work across multiple software environments simultaneously to save time and effort invested in opening them separately. 

For example, a shipping company’s BRE integrates GPS tracking and payment systems to provide updates on shipping locations and payment status. 

Version Control and Auditing

BRE applications ensure that every change to your business strategies should be recovered and documented. This allows you to track changes to the business rules, letting you revert to previous versions if required. Industries with high regulatory requirements benefit highly from this component. 

For example, A financial services provider modifies the billing rules as per SEC or other applicable regulations.

Monitoring and Analytics

Monitoring and analytics give you a detailed insight into how your business engine is performing. It identifies issues, measures the effectiveness of logic, and ensures continuous improvement. You’ll get alerts when potential risks pop up. This component allows you to use historical data to understand how business rules affect your current business operations, enabling you to refine your rules. 

For example, an e-commerce company uses analytics to measure the effectiveness of its rules in detecting fraud. This allows it to improve its business rules to minimize false or suspicious orders. 

4 Types of Business Rules Engine

Below are the different types of BREs.

1. Open-source BREs

Open-source BREs allow users to easily access and adjust the source code to modify business rules. It is free-to-use, which is beneficial for small and mid-sized businesses. However, modifying source code requires technical expertise. So, if you have an in-house technical team, go for open-source BREs. 

For example, Drools is a widely-used open-source BRE that supports complex rule authoring and decision automation, making it a great fit for businesses with skilled developers.

2. Proprietary BREs

Proprietary BREs offer enterprise-grade solutions to large organizations. It comes with extensive features, ongoing updates, and dedicated support. These BREs are ideal for businesses without in-house technical expertise. 

For example, IBM Operational Decision Manager is a widely-used proprietary BRE that helps organizations automate complex decisions with scalability and accuracy.

3. Cloud-based BREs

Cloud-based BREs are scalable and flexible systems especially designed for businesses focusing on remote access. It integrates with cloud-native applications to enable any business user to access it through web-based platforms. Also, the overall cost of implementing the system is low as there are no maintenance and infrastructure costs. You just need to pay the subscription fees. 

For example, AWS Lambda and Azure Logic Apps enable businesses to define, execute, and automate workflows while leveraging the cloud’s scalability and reliability.

4. No-code BREs

No-code BREs help non-tech users create or automate rules without writing a single line of code. The engines are designed with user-friendly interfaces, such as drag-and-drop rule creation and automation, to help users manage rules easily without depending on IT teams. 

For example, Tools like GoRules, DecisionRules, and InRule offer simple, user-friendly rule automation and management for businesses.

6. Benefits of Using a Business Rules Engine

A BRE offers several benefits that enhance decision-making, process automation, and operational efficiency. Here are some key benefits:

1. Improved Agility and Flexibility

A BRE lets your business adapt to changes, whether it’s modifying operational policies, reducing time-to-market, or strengthening regulatory updates. It allows you to execute changes faster without rewriting any code. The agility and flexibility you get will help your business stay ahead. 

For example, Insurance companies previously had to follow lengthy development cycles and required more IT resources to update their policy terms. With BRE, they can directly redefine rules such as agility criteria, discounts, and premium calculations in the system, allowing frequent updates to meet changing standards.

2. Reduced Development Time and Costs

BRE applications separate business rules from application code, which allows you to test, modify, and manage your rules easily without interfering with the software’s code. Business analysts and domain experts can manage the business rules independently, minimizing the involvement of the IT team. This helps reduce development costs and time and frees IT resources to focus on important projects. 

For example, A retail business uses a BRE to automate tasks like adding discounts, saving customer details, and tracking payments and deliveries. Marketing teams can adjust rules directly, reducing the need for IT to code each campaign. This shortens development time from weeks to hours, saving both time and money.

3. Increased Consistency and Accuracy

Human attention in executing business rules could involve errors, inconsistencies, or bias. A BRE application, on the other hand, allows you to define rules and decisions and test their consistency and effectiveness. This way, you can optimize your rules to enhance consistency and accuracy in business operations. 

For example, A private bank implements BRE to measure and evaluate loan applications based on income thresholds and credit scores. The engine applies consistent criteria to approve or reject applications based on factors such as minimum income, income tax returns, debt-toincome ratio, etc. This enhances its operational accuracy in loan sanctions. 

4. Better Decision-Making

When you have the capability to verify the effectiveness and determine the outcome of your predefined rules, decisions, and policies, decision management becomes a lot easier. It also helps you align your business rules with your goals and applicable standards. As a result, you can make better business decisions and achieve greater results. 

For example, an eCommerce business or a global retail store leverages BRE to detect fraudulent transactions. It integrates predefined rules with machine learning insights to flag suspicious activities in real-time. This will minimize losses and enhance customer satisfaction. 

5. Simplified Compliance and Governance

Complying with applicable standards and regulations is challenging, resource-intensive, and complex. BRE acts as a central hub to manage compliance rules specific to your industry and region. This ensures your business faces minimal risks and shows maximum transparency to regulatory bodies. 

For example, healthcare organizations must follow HIPAA regulations to protect patient data. BRE applications automate data-sharing and access controls to ensure compliance. If a rule changes, BRE creates an audit trail to check compliance and identify issues. This way, the organization can quickly fix the issue to avoid scrutiny from regulatory bodies and maintain patient trust. 

6. Empowered Business Users

BRE applications offer a user-friendly interface that enables non-technical users to manage, create, and modify rules independently, even without being skilled in programming languages. It encourages your team to collaborate and innovate more, eliminating bottlenecks in your operations. 

For example, a manufacturing company uses a BRE to automate and manage machine workflow approvals. The manufacturing team can update rules for approvals based on bulk orders, order size, delivery timelines, and vendor ratings without IT support. This speeds up approvals and production, boosting productivity.

7 Challenges and Limitations of Business Rules Engine

Knowing the challenges and limitations of BRE helps your organization prepare for future complexities and make better decisions. Here are the key challenges and limitations of using a BRE:

1. Complexity in Managing Large Rule Sets

When your business grows, your systems and processes add up, which increases your list of rules. A business rules engine with a wide range of interdependent rules is challenging to manage and may lead to inefficiencies or errors. 

Solution: Organizations often implement a rule governance framework to address these challenges. They categorize business rules based on their geographic scope or function to help the team manage operations smoothly. 

For example, an insurance company uses a BRE to manage policy rules across countries. Over time, the rules grew to thousands, causing confusion and increasing error risks in underwriting policies. Changing one rule often unintentionally affects others. To solve this, the company can implement a governance framework to organize rules by location, making finding and managing them easier while reducing errors.

2. Performance Issues with Real-Time Processing

BREs help your organization make informed decisions in real time by testing your rules and policies. However, performance issues arise when processing complex business rules with large data sets. This stresses your system and affects its efficiency. 

Solution: Performance issues can be handled easily by evaluating and pruning unnecessary rules, integrating rules engines with high-performance frameworks, or implementing parallel processing. Also, you can perform regular stress testing to ensure the BRE can manage peak loads in real-time. 

For example, a global retail store uses a BRE for real-time promotions and fraud detection. During peak shopping times like Black Friday, the system often slows down or crashes, frustrating customers. To fix this, the company uses high-performance frameworks and regular stress testing to make the BRE handle heavy traffic more efficiently.

3. Dependency on IT Support for Rule Updates

Many modern BREs offer intuitive and user-friendly interfaces for non-tech business users to manage changes in rules by themselves. However, changing or modifying complex rules requires IT support. This reliance delays the processes as the support team will have plenty of other tasks to complete alongside updating rules. 

Solution: Businesses can leverage natural language rule definitions and drag-and-drop interfaces to train non-tech users to manage rules confidently. This will reduce IT dependency and save time in operations. 

For example, an eCommerce platform depends on its IT team to update offers and discount rules. Frequent small changes caused delays and mistakes in campaigns. By using BREs with simple rule definitions, the company enabled non-technical staff to manage rules directly.

4. High Cost for Advanced or Enterprise Solutions

Implementing a powerful BRE in small organizations can be expensive, especially for enterprise or business-grade subscriptions. The implementation, licensing, and maintenance costs exceed many organizations’ budgets. 

Solution: Small or medium organizations can implement open-source or subscription-based BRE options to manage business rules. It is advisable to conduct a cost-benefit analysis before going with any BRE application. This ensures your investment is meaningful and you get expected returns. 

For example, A mid-sized industry evaluates an advanced-grade model for managing business rules. It finds that the overall costs, including the integration with other platforms, are too expensive. The firm searches for subscription-based or open-source models to implement BRE into its organization and handle rules within its budget. 

5. Difficulty in Testing and Debugging Rules

Testing and debugging rules can be challenging, especially when dealing with interconnected rules. Identifying bottlenecks in intricate dependency rules requires expertise and effort, which is time-consuming and requires the unnecessary use of resources. 

Solution: You can implement simulation environments and automated testing frameworks to identify errors before deploying business rules. Regular sandbox testing and audits also maximize the chances of detecting errors before they reach production systems. 

For example, a healthcare organization uses a BRE to manage a patient’s insurance eligibility criteria. It often encounters discrepancies in approvals while processing patient requests. During testing and debugging, conflicts between the newly added rules and the existing rules are found. This delays service delivery and impacts patient experience. 

6. Challenges in Integrating with Legacy Systems

While integrating with legacy systems, you may encounter compatibility issues that require strong customization. This will improve the implementation time and slow down other related operations, resulting in higher costs. 

Solution: The challenge can be avoided by conducting an effective compatibility assessment. You’ll find many integration platforms that help you bridge the gap between BREs and legacy systems. Once done, it will reduce the development timelines and faster movement of business processes. 

For example, a bank tries to integrate a modern business rules engine with its core banking system. There are lack of documentation and APIs for integrating legacy systems, resulting in extended development timelines. By conducting a thorough assessment, the bank managed to connect its legacy systems with BRE to reduce development complexity. 

7. Potential Compliance and Security Concerns

BRE is great for managing compliances. However, it may fail at managing poorly designed or inaccurately secured systems which results in vulnerabilities and compliance risks. 

Solution: Organizations often implement strict rule update processes, such as compliance checks and regular audits, to overcome compliance challenges. You can use security features like encrypted data, access controls, multi-factor authentication, and more to secure the BRE environment. The organization also needs to train its operation staff on cybersecurity best practices and compliance requirements. 

For example, a global online store uses BRE to manage tax calculations. Due to outdated rules, it unintentionally violates the tax laws in a certain region, which can result in penalties and harm to the business’s reputation. Regular audits can help the business detect and update rules according to new tax requirements. 

What is the Difference Between Business Rules Engine and Workflow Automation Tools?

Parameter	Business Rules Engine (BRE)	Workflow Automation Tools
Purpose	BRE automates the decision-making process by managing business rules.	Workflow automation tools automate or streamline the sequence of approvals, workflows, and repetitive tasks within the process.
Key Feature	It focuses on monitoring and evaluating specific conditions, applying rules based on the situation, and automating the decision-making process.	It focuses on accelerating tasks and events across business users or systems.
Rule complexity	BRE is capable of managing strict rules based on dependencies and priorities.	It can handle simple rules but primarily focuses on smooth process flow.
Decision-making	It helps business analysts and other business users to make precise decisions based on predefined logic.	It is not a decision-centric application.
Users	The primary users of BRE are compliance teams, decision-makers, business analysts, and domain experts.	The primary users of workflow automation tools are process managers, coordinators, and operations teams.
Adaptability	It adapts to new rules quickly without modifying any process.	It adapts to workflows by modifying approvals.
Use Cases	It’s useful for insurance companies, manufacturing plants, healthcare industries, global retail providers, and more.	It’s useful for employee onboarding, incident resolution workflows, purchase order approvals, and more.
Integration	It integrates with ERP and CRM systems where decision-making is crucial.	It integrates with project management tools, email management tools, HR systems, etc., to streamline task flows.

How to Choose the Best Business Rules Engine?

A BRE automates complex business logic to improve decision-making, but choosing the right BRE is essential for your organization. To do this, you need to evaluate each BRE application carefully based on your requirements. Below are some tips to help you choose the best business rules engine. 

Rule Deployment

Rule deployment is the process used to manage and implement business rules within your organization. An effective rule deployment makes sure that any changes to the rules are quick and smooth. You’ll need to look into real-time rule updates, rule versioning, rollback capabilities, deployment support, and more. 

Import/Export Features

When choosing a Business Rules Engine (BRE), make sure it can easily import and export rules to and from your systems. Check if it can integrate with third-party tools and handle rules from legacy systems. Ensure it supports common file formats like JSON or XML and allows bulk imports and exports for efficiency.

Performance

The performance of BRE defines the ability to implement rules efficiently, especially with complex logic and under peak load. A high-performing BRE lets you make faster decisions during critical periods. You’ll need to look for benchmarks, such as rules per second, to check the processing speed, low latency, stress-testing results, etc. 

Integration

BRE integrates with applications like ERPs or CRMs to manage complex rules more efficiently. Check whether the BRE has an integration option to ensure smooth operations. You’ll need to look out for pre-built connectors, APIs, support for legacy systems and modern protocols, and more. 

Scalability

Check BRE’s ability to handle increasing rules as your business grows. When your business grows, the rule management application needs to evolve without overhauling the whole system. You’ll need to look out for cloud-based options, the BRE’s capability to handle large data sets, and support for additional environments while selecting the best BRE. 

Ease of Use

Ensure your selected BRE is simple for non-tech users to create, update, and manage business rules effectively. Business analysts and domain experts need to update rules whenever required and reduce reliance on IT teams. Look for features like user-friendly interfaces, easy navigation, natural language rule definitions, comprehensive documentation, and training materials. 

Pricing

Evaluate the BRE’s costs relayed to licensing, implementation, and maintenance to check whether it is within your budget. A good BRE offers flexible and affordable pricing with advanced features, helping small and mid-sized businesses achieve their goals without overspending. Opt for tools with clear pricing, try demos for personalized quotes, and check for free trials.

Resources and Further Reading

If you want to sharpen your skills in business rule engine (BRE) software, consider reading these books available on Amazon:

Business Rule Engine BRE A Complete Guide: This best-seller book reveals everything you need to know about BRE and helps you prepare for BRE challenges. 

The Operational Excellence Library; Mastering Business Rules Engines: It acts as a step-by-step guide to understanding BREs, case studies, detailed solutions, and actionable tips while implementing change. 

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