Cisco is turning to business rules software to help it respond to new market opportunities, changing regulations,...
and business practices in a more agile way
The company has begun a project that will allow it to extract the rules which govern how it runs its business from a myriad of diverse IT systems, placing them instead into a central “rules engine”.
It will give Cisco the ability to respond in a more agile way, as it seeks to establish a presence in rapidly growing emerging markets, said KC Wu, VP of information technology for Cisco. “The main driver is to build a very agile enterprise to respond more proactively to any new market opportunity,” she said in an interview with Computer Weekly.
If the project is successful, the central rules engine will eventually give Cisco the ability to change a business rule once and have the new rule cascade automatically throughout the company. The company’s current infrastructure means that each business rule could be encoded in up to 10 different IT systems, making it difficult to change business rules quickly in response to changing business needs.
Cisco opted to use technology from Pegasystems to develop the rules engine concept, following a successful proof of concept test last year. A trial then showed the capability of the software under four difference scenarios; managing product pricing, channel rebates, the service supply chain, and sales discounts.
Cisco chose Pega technology for the trail, because of its capabilities across several business management areas.“We were looking for a partner or a vendor who will give us a solution across four areas: process management, events management, rules management, analytics and intelligence,” Shirish Joshi, IS director at Cisco Systems told Computer Weekly.
Cisco has rolled out a rules based system to guide sales staff on the discounts they can offer customers, taking into account the mixture of equipment they order, and the cultural practices of the country they work in. The system, which went live in May, will free up sales teams from having to go through time consuming internal approval processes, allowing them to concentrate more on selling, said Wu.
It uses a traffic light approach, with green lights for discounts that match accepted practices, yellow lights for those that may be on the high side and red lights for discounts that will need approval from senior managers. “You basically return a lot of hours to the sales team, and the finance team to do the real work of negotiating and debating,” she said.
Cisco has rolled out a second Pega application to help it manage the business processes in its equipment servicing supply chain. The system, which also went live last month, takes data generated when customers request replacement parts from multiple software applications and displays progress results on a dashboard.
It alerts managers if there are any problems with orders, so that they can take immediate remedial action, said Joshi. The company is now looking at how it can exploit the analytic capabilities of Pega software, for example to track customers’ responses on Twitter and buying habits.
Cisco is taking a step by step approach to developing the rules engine concept, and will evaluate each project before moving forward, said Wu. “The fact that you have two projects does not mean much, but we see the potential,” she said.
The Pega project was a learning curve for Cisco, Wu revealed. Although Pega is well established in financial services, high tech manufacturing is a new area for the supplier.
Wu advised other organisations thinking of deploying Pega to view it more as a business change project, than a technology solution. “You need to look at your whole ecosystem architecture holistically and have some strategy about how to go about it,” she said.
Viewing Pega software as a point solution to solve a problem is a mistake that will probably mean a lot of reworking, said Wu. “We talked to a credit card company, and they told us they did it wrong first time. Another company told us they would have picked a different project for Pega if they started over,” she said, after comparing notes with other Pegasystems customers at the user conference, Pegaworld 2013.
It is vital that the business and IT work closely together to implement Pega software, if the project is to be successful she said. “It really should be driven by the business. Its technology enabling the business strategy so [if you are] just implementing the technology, you will not get the benefit.”