Business Logic: What It Is and How to Use It

Sound decision-making can’t happen without data.

But no amount of data extraction solves business problems if you can’t make sense of the information you’ve gathered. That’s why companies need business logic to gain actionable insights from their database that best fit operational requirements.

The definition of business logic can mean many things. In software, it refers to business rules that determine how to transform and deliver data to people in the form of workflows. In programming, business logic dictates the regulations of processing information per specific criteria. 

Operating with decision management platforms empowers businesses to create, store, and test business rules against various scenarios. Programmers use these tools to integrate business rules into applications and workflows and define any constraints around operations.

Different areas of business use different processes. Executing these procedures requires a series of smaller tasks that can often be automated to achieve higher efficiency. Business logic delivers custom rules for scenarios like this, making it possible for organizations to replace manual efforts with suitable software.

Before learning more about business logic, make sure you know some key relevant terms:

• Workflow comprises the steps to complete a business process using data. Business logic supports easy workflow management through data organization.
• Trigger is an event that keeps workflows running smoothly. It occurs when a record is updated or completed, which, in turn, starts another action. 
• Database is an organized data set stored and retrieved on a computer system. Users access the required business logic to make smart workflow decisions.
• Database management systems (DBMs) are the central hub for collecting, managing, and analyzing data in a database. 

What is the purpose of business logic? 

Companies have data pouring in from several sources simultaneously. Using business logic, they can track and analyze big data. It also guides how different business objects interact with each other.

Business logic is part of a computer program that interprets a real-world business rulebook as code, stored in an application programming interface (API) or embedded into websites. One core purpose is creating workflows transmitting data between users and software. For example, if you click on a website button that says “download now,” the click brings you the data you want through the workflow defined by business logic. It also determines how to make, store, display, and alter business data.

Companies turn to business logic to convert business rules into instructions for software systems. It takes the backend application input and turns it into the front-end output that a user sees. 

Business logic also ensures that the daily tasks implicating numerous categories of data stay functional. Employees keep up with their responsibilities while consistently tracking and updating essential data points.

Understanding the business logic layer 

Business logic automates business rules. In a 3-tier application architecture, the business logic layer (BLL) is placed between the presentation layer and the data access layer (DAL). These three layers are essential in building applications and grouping related functions.

The top layer is the presentation or user interface layer that displays the data for the user, allowing them to interact with it. BLL triggers the exchange between the top and bottom layers and oversees business rules calculation and logic creation. DAL is the final layer that manages the data through a database. It separates the presentation logic  – what users see – from the data access logic – what IT sees.

Key components of business logic

In this section, we’ll go over the essential elements of business logic so you’ll feel confident creating and optimizing business processes. 

Data consistency

Business logic relies on data consistency and stability. Suppose you’re recording information into a company's database. In that case, you have to comply with the business rules to maintain uniformity because doing so allows employees to filter data efficiently and execute their tasks accurately. 

For example, a customer information form may allow workers to input dates strictly using the US format mm/dd/yyyy to maintain consistency. 

Access control

Companies have to establish control over which employees get to access which data. Anything that’s not relevant to an employee’s role should remain inaccessible to them. Business logic allows companies to determine valuable information and implement user provisioning to supervise who views and interacts with their systems. 

For instance, executives can only access data for their accounts, but customer success managers can access information about support calls across departments.

Modification restrictions

Business logic also determines who can modify a company’s database. Like access control, modification restrictions prevent unnecessary alterations to critical business data. To mitigate any discrepancies, businesses must define which employees have permission to change their database.

As an example, since companies must store employee information in their database, only the human resource (HR) employees can access and modify those records because they’re qualified and accountable for dealing with personal employee data.

Business logic vs. application logic

Business logic is often confused with the term application logic, but there’s a key difference between the two.

Typically written in if-then statements or decision trees, business logic is a code that determines the data exchange between a user interface and a database. It comprises real-world business rules and specifies how data should be created, exchanged, and managed. 

Application logic enforces business rules in an application. It connects business logic and user interface. Application logic is not related to business decisions or data. It’s simply a series of actions that are triggered by an event. 

For instance, business logic is responsible for moderating the input of a customer information form. Application logic ensures that when a user clicks a downward arrow button, it will download the form to their system.

How do business logic and application logic work together?  

While they serve distinct purposes, companies often integrate application and business logic to automate tasks, protect data, and deliver a consistent user experience. A business can look to application logic to depict which programming language to use for developing software and then apply business logic to outline the functionalities of the end product.

In simple terms, when an application needs to execute a task, business logic tells it the process to complete it as per business rules. Application logic uses the same information to carry out the defined process steps.

Examples of business logic

Business logic is essential for establishing expectations and policies, ensuring compliance, and automating workflows. Some common business logic examples include:

Process flows

Businesses can design process flows with business logic to dictate how users can trigger the next step. Process flow controls how information is filtered while ensuring the execution of automated tasks. 

When someone tries to log into a website, business logic controls the correct process flow by entering the username and password before taking them to a landing page. 

Data validation

Business logic is also responsible for maintaining accurate and high-quality data. It creates database testing procedures to guarantee users enter data in the correct place with the proper format and within the defined character limit. 

Notifications

Companies can automate sending out alerts to the IT department when a major business system is down. This is just one-way notifications address business issues before they impact workflow. With business logic, companies set and execute rules around notifying the right people with the right information at the right time. 

Transactions

Business logic helps companies define the rules of how an application should perform when executing a paid transaction. In case of errors, it steers the user to an alternative payment mode to finish the purchase. 

For instance, when a user clicks the pay now button to complete a transaction, business logic authenticates the payment method and status before marking a purchase complete. 

Calculations

Business logic sets the rules for how an application performs calculations. These calculations could be discounts, shipping charges, or sales taxes. When a customer adds items to the cart, business logic adds the value of each item to give them a final payable amount along with any additional charges if applicable.

Business decisions

Making critical business decisions gets easier when you have the right data. Decision management platforms use business logic to author, store, and test business rules to make decisions. Business logic assists in decisions like promoting the right products during peak seasons to website visitors.

How to prevent business logic vulnerabilities

Vulnerabilities in business logic refer to flaws in either the design or implementation of software applications. It occurs when an unexpected or unidentified user interaction with an application happens.

Business logic vulnerabilities let hackers create unexpected behavior by manipulating functionality. They might be able to steal confidential information by evading authentications or make applications perform in a way they aren’t supposed to. 

Sometimes, business logic vulnerabilities are unintended. For instance, online coupons are meant to offer one discount per customer. However, if a system flaw enables the user to redeem the same coupon multiple times, the company ends up losing. 

Since APIs are also governed by business logic, these vulnerabilities are not limited to applications. Here are some ways companies can prevent developing business logic vulnerabilities in their APIs.

• Understanding the software. The first step in protecting anything is to enhance your understanding of it. Make sure your data security, testing, and software development team understand the software in question. Assemble a list of known vulnerabilities, licenses, and code components to cover every possibility.
• Avoiding behavior assumptions. One of the most common mistakes developers and testers make is assuming user behavior when interacting with software. Implement necessary logic to verify assumptions, such as making sure that user input is logical before proceeding with any action. 
• Eliminating logic flaws. Application workflows with design flaws in their business logic are highly vulnerable to unauthorized access. The security team should be well-versed in an application to test users' actions and tasks to reveal potential loopholes and control gaps. 
• Knowing to prioritize. Addressing every vulnerability gets tricky. Businesses should identify high-risk vulnerabilities through analytics tools and prioritize fixing them first. Putting the most pressing issues on top of the to-do list can save the company from disasters.

Keeping up with changing business logic

Change is the only constant, and business logic is no exception. With time, business logic is bound to evolve with your company. Such changes can severely impact the software code. 

Business logic can change over the years for many reasons. It could be due to a change in how users interact with your product, a difference in your pricing model, or perhaps a shift in your team structure. 

Whatever the reason, if your company is focused on working with new products and building new features, business logic must be flexible. 

Some ways to develop software that supports changing business logic include:

• Learning business needs before writing code. You can’t write code that solves business problems without first understanding the problems. Immerse yourself in critical thinking and ask questions to grasp the situation before proceeding.
• Frequent testing. Testable codes are easier to understand and extend. Conducting routine tests like A/B testing will make you more confident about making modifications to them.
• Using design patterns. These are perfect for implementing existing solutions to avoid wasting time on solving the same problem repeatedly. Design patterns allow a quick understanding of different approaches when tackling problems.

Common sense isn't that common; switch to logic.

Managing rules and workflows in applications is more accessible than ever with business logic. While understanding business logic might seem easy, applying it to your operations is slightly more complex. 

The good news is there’s no pressure to define it perfectly. As long as you have business logic implemented for your system, you should be able to test and improve decisions efficiently.

And just because the term is “business” logic, it doesn’t mean it only concerns management. Developers and testers should also deeply understand business logic and rules to integrate them into organizational workflows and automate processes. 

With shared understanding, business logic can become the ultimate tool for developing upgraded systems, complying with rules, and optimizing process efficiency in the long run.

Curious to know more? Read about business process modeling to automate business processes for enhanced productivity.