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Business Rules Engines in 2024: How They Work & Benefits

Businesses rely on a wide range of information to make decisions, from customer data and market trends to business operations data and company performance metrics. However, managing and using all this information in decision-making can be challenging, as it is often spread across disparate business systems and data silos.

One solution to this problem is business rules engines, which are tools that help businesses in decision automation through business rules. In this article, we’ll explore what a business rule engine is, how it works, and its benefits for organizations.

What are business rules?

Business rules are instructions that describe or restrict how a certain business activity or task should be performed to assist employees and enterprise applications in business decision-making. Check our article on business rules for a comprehensive account of their importance, types, and examples.

What is a business rules engine?

A business rules engine (BRE) is a software application that allows users and other applications, such as ERP or CRM systems, or RPA bots, to execute an organization’s internal policies or procedures, namely business rules, in a runtime environment. BREs help businesses automate decision-making processes by executing and enforcing complex business rules from a centralized platform.

How do business rules engines work?

There are stand-alone business rules engines in the market but a BRE is typically a component of a business rules management system (BRMS) that allows organizations to define, store, execute, and manage business rules. At the most basic level, a BRE:

  • Receives a request from other applications with relevant data needed to make a decision,
  • Checks the request and incoming data against relevant business rules stored in a repository, which is another component of a BRMS,
  • Returns a decision and executes a specific action based on the decision.

For example, suppose you have an applicant tracking system that processes job applications based on several business rules. For instance:

  • If a submitted resume passes resume screening, then send the applicant an email containing a link for the online exam. Else, send a rejection email.
  • If the candidate passes the online exam, then send an invitation to interview with several time slots. Else, send a rejection email.
  • If the candidate attends the interview and passes it, then send an email with the job offer. Else, send a rejection email.

Normally, the criteria for passing the screening or online exam are hard-coded into the applicant tracking system. So, if HR wants to change these criteria, they need to ask the IT department to change them. A business rules engine allows businesses to separate business logic from the rest of the enterprise applications.

For the example above, instead of hard-coding the business rules that govern whether an applicant passes a hiring stage, the applicant tracking system provides the relevant applicant data to the BRE and it returns a response based on the rules. This allows non-technical users from all departments to change and execute business rules relevant to their function from a central platform without IT involvement.

Benefits of business rules engines

By centralizing business rules and automating complex business decisions across the enterprise, a BRE:

  • Improves decision-making consistency: Businesses can deploy the same business logic throughout all processes, ensuring all decisions, no matter how big or small, are coherent and aligned with broader business objectives.
  • Increases business agility: A BRE allows non-technical subject matter experts (SMEs) to create, update or change business rules relevant to their business functions without IT involvement. This can allow companies to respond to ever-changing business environments and needs without changing enterprise applications’ codes.
  • Reduces complexity: Business decisions often require considering lots of factors and rules, so embedding them into the code of your enterprise application can easily get complicated. Business rule engines reduce business decision complexity by separating code from business logic and representing the business logic within a single framework.

Further reading

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Cem Dilmegani
Principal Analyst
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Cem Dilmegani
Principal Analyst

Cem has been the principal analyst at AIMultiple since 2017. AIMultiple informs hundreds of thousands of businesses (as per similarWeb) including 60% of Fortune 500 every month.

Cem's work has been cited by leading global publications including Business Insider, Forbes, Washington Post, global firms like Deloitte, HPE, NGOs like World Economic Forum and supranational organizations like European Commission. You can see more reputable companies and media that referenced AIMultiple.

Throughout his career, Cem served as a tech consultant, tech buyer and tech entrepreneur. He advised businesses on their enterprise software, automation, cloud, AI / ML and other technology related decisions at McKinsey & Company and Altman Solon for more than a decade. He also published a McKinsey report on digitalization.

He led technology strategy and procurement of a telco while reporting to the CEO. He has also led commercial growth of deep tech company Hypatos that reached a 7 digit annual recurring revenue and a 9 digit valuation from 0 within 2 years. Cem's work in Hypatos was covered by leading technology publications like TechCrunch and Business Insider.

Cem regularly speaks at international technology conferences. He graduated from Bogazici University as a computer engineer and holds an MBA from Columbia Business School.

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