What is the Difference between a Business Rule and a Business Requirement?

Difference between a Business Rule and a Business RequirementUnderlying business rules provide guidance to an organisation or company, while business requirements state a high-level future state that will achieve a business rule, opportunity or need. Business rules tell you what you may or may not do something. They might also provide criteria or conditions for making decisions. On the other hand, business requirements outline what needs to be done to enable or comply with a business rule.

Business Rules

A business rule relates to the way an organisation or company operates. In addition to applying to individuals, business rules might apply to general corporate behaviour or business processes. They might also apply to specific elements of an organisation, such as data management. The overall objective is to ensure an organisation is meeting its goals. The best business rules are clearly defined and written down. There should also be accountability to understand who has ownership of the business rules, whether it is a company's president, the board of directors or another individual or body.

Business rules are generally a set of statements or conditions that help guide actions and activities by a business and potentially their stakeholders, such as staff, managers, suppliers, customers and others. Conditions and other criteria help inform decisions. Business rules provide guidance related to what specific actions or activities that can be undertaken. They help inform the development of policies and processes, including defining requirements for services, projects and other initiatives. Since they are typically foundational, business rules are usually long-term and fairly static. Any changes to a rule will result in new or amended business requirements.

Business Requirements

A business requirement outlines what needs to be done to meet a business need or objective. They state what the end result or future state. Business requirements are typically developed for a specific business activity or project. They are usually developed when looking for solutions to address a business need or implement a business goal or objective. They are often clear and concise, and are defined in a business case, a statement of work, a cost-benefit analysis or a similar foundational document for a specific project or activity.

Since they are informed by business rules, business requirements should be consistent with the latest set of rules. Typically, different sets of business requirements may be needed for different rules. A business requirement generally relates to what must be done in order to enable or achieve a business rule. Business requirements also relate to achieving business needs or objectives, which might not relate to a business rule but are influenced by these rules. To add detail to business requirements, functional requirements must be developed to clearly outline how a business requirement will be addressed or achieved. Functional requirements provide specific steps to develop and implement a business requirement.

Similarities and Differences

Business rules and requirements must be consistent with an organisation's mandate or mission. They must also respect business objectives, goals and needs. At the same time, business rules will also influence an organisation's mandate or vision, as well as its objectives and goals. All these statements and conditions must be aligned and consistent. While a business rule can exist without business requirements, business requirements exist within the context of a broader framework, for example a company's business rules, objectives, goals, mandate or vision.

Business rules provide parameters on what can and cannot be done in specific situations. They may also provide criteria, conditions and exceptions related to these scenarios. For example, a business rule may be that all clients must have a valid address in the UK to access a service. Rules might outline conditions, such as requiring a specific period of residency. Exemptions might also be included, such as waving residency requirements for members of the Armed Forces. Business requirements outline what must be done to implement or comply with a business rule. For example, a business requirement could relate to processes for business staff to verify client addresses or send documents and information to clients.

Benefits of Business Rules and Requirements

Business rules and requirements provide a clear basis to guide operations. Business rules and requirements also help an organisation better achieve common objectives and goals by providing a consistent framework. They ensure everyone is on the same page, allowing for a clear understanding of what needs to be done and providing an opportunity for open communication. Clearly defined business rules and requirements often help reduce confusion, which can result in delays and misdirected efforts. Reducing delays and errors can reduce costs and increase confidence within and outside an organisation.

Need Help?

Business Conultants can help companies understand the difference between business rules and requirements. Find business consultants in Aberdeen, Coventry, Croydon and throughout the UK.