DMN Recognized as Mortgage Industry Standard

DMN Recognized as Mortgage Industry Standard

by | Mar 30, 2019 | Technology Report

The Mortgage Industry Standards Maintenance Organisation (MISMO), a wholly owned subsidiary of the Mortgage Banker’s Association, announced on Wednesday March 25, 2019 that it adopting the decision model and notation (DMN) as a standard for documenting, implementing, executing and exchanging business rules and decisions across the mortgage industry.

 

What is the Industry Impact?

MISMO develops and champions standards that are widely used through the mortgage business—by mortgage lenders, real estate investors, resellers, housing agencies and companies servicing borrowers—to exchange information effectively and securely. Most regulators require the use their standards to support automation of mortgage paperwork and to facilitate the fast, low error, low cost collaboration between the entities involved in mortgage funding, creation, selling and end-borrower support. It also provides certification and advocacy for its standards.

The use of DMN, a standard that support executable documentation, will support a more effective integration between the partnering entities within the mortgage industry, allowing them to exchange business rules and decisions (for example repayment requirements, reporting mandates and service constraints) more directly, more quickly and with fewer errors than ever before. This in turn will support tighter and more effective compliance and drive down costs for everyone involved. 

Sharing rules, along with the data used by the rule, will help address many of the interpretive and compliance issues that currently bedevil the mortgage industry. Understanding the rules used by business partners will help resolve differing interpretations and confusion, which in turn should greatly reduce costs across the industry.

Brian Stucky

CEO, DecisionX, co-chairman of MISMO's Decision Modelling Community of Practice

What This Means for DMN

This is momentous news for the users of DMN as well as the mortgage industry. This acceptance of the need for and use of standards in the interchange of decision making and business rules in mainstream finance paves the way for use of DMN in many other industries. It also provides an excellent illustration of the benefits of using the standard.

Concrete Illustration of Benefits

The mortgage use case epitomizes the tangible benefits of representing business decisions using a standard to:

  • Provide a means of representing business policies and contracts that are demonstrably free from error and that can be exchanged without ambiguity, facilitating faster, lower cost collaboration;
  • Combine documentation and execution into a single form that is tangible to business experts and that can be certified by regulators as a vehicle for the low overhead support of compliance and
  • Facilitate the safe and agile development and evolution of business policies and products

The key benefit is the lower operational costs achieve by using a standard. Costs are lowered because the full impact of policy changes can be tested more effectively and quickly, lowering the cost of mistakes—the errors that are made when policies and business rules are merely implied by data rather than explicitly stated. We believe this move beyond exchanging mere data towards the explicit development, representation, management and communication of business policies and products using a standard is a significant step towards greater transparency, more rigor, higher agility and lower cost of business collaboration and compliance.

New Tool Changes the Face of Business Decision Modelling/Management?

New Tool Changes the Face of Business Decision Modelling/Management?

by | Jun 23, 2013 | Technology Report

The need to cope with ever increasing rates of change in business policies has made agile decision/rule management a vital topic for enterprise architects – particularly where regulators or legal compliance are concerned – we need to involve business SMEs directly in the capture and stewardship of decisions to improve agility and accountability. Regular readers of this blog already know the significant benefits the Decision Model (TDM) offers in this area. But, until now, we’ve been hampered by the absence of cost-effective tools that support TDM and that would encourage mass adoption of the technique.

Our wait appears to be at an end.

The week before last saw the release of another tool to support decision modelling and management: BiZZDesign Decision Modeller. This offering not only boasts cost effective, fully-featured support for The Decision Model framework (including list fact types and messages), but its combination of four other features excites us, as TDM practitioners, rather more than existing TDM tools. In this article we discuss: our experiences of this product, what’s genuinely new about it and how it might change the way enterprises use TDM and existing BRMS/BDMS technologies. (more…)

The Decision Model: Business Rules Grow Up

The Decision Model: Business Rules Grow Up

by | May 7, 2013 | Technology Report

The world of business rules and business rule management has grown up. Welcome to the world of business decisions—a much more compelling technique with which companies can manage their operational business policies.

Until now business decision analysis and maintenance—the means by which business logic is discovered within current business practices, mined from opaque legacy systems, represented in transparent format and managed as a business asset directly understood by business subject matter experts—has been rather vendor-specific and lacking in rigour and scalability. Many methods are available (e.g., EDM, ABRD and BRS), but all are either lacking in formal structure, subjective and/or poorly supported by tools. Developments of the past few years have changed this.

With the advent of The Decision Model (TDM) and tools (like BiZZDesign, Sapiens DECISION and OpenRules) that support it, an era of new rigour and effectiveness has dawned within enterprise decision management.  TDM, a precise method and framework for expressing business decisions, has addressed many of the flaws of business rules and prompted a slow evolution from business rules to business decisions. We examine these flaws, what TDM can do for you and the promise and power of this approach. (more…)

When To Choose Open Source BRMS

by | Mar 10, 2011 | Technology Report

The cost effectiveness of open source business rule management systems (BRMS) are surely self evident – they are free aren’t they? Isn’t that always better than paying a traditional vendor through the nose? Isn’t this decision one of technology’s no brainers? Well no, I don’t think it is… (more…)