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Chapter 1 Introduction

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41 views10 pages

Chapter 1 Introduction

Uploaded by

Flor Cabillar
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Introduction

Data Mining for Business Analytics


What Is Business Analytics?
 Practice and art of bringing
quantitative data on decision
making
 Range of data analysis methods

 Data mining is the process of


exploration and analysis, by
automatic or semi-automatic
means, of large quantities of
data in order to discover
meaningful patterns and rules.
(Berry and Linoff, 1997, p. 5)
Business Intelligence
refers to data visualization and reporting for
understanding “what happened and what is
happening.”
Example dashboards:
Business Analytics
typically includes BI as well as sophisticated data
analysis methods:
statistical models
data mining algorithms
 used for exploring data, quantifying and explaining relationships
between measurements, and predicting new records.

 regression models are used to describe and quantify “on average”


relationships (e.g., between advertising and sales), to predict new
records (e.g., whether a new patient will react positively to a
medication), and to forecast future values (e.g., next week’s web
traffic).
Examples of Predictive Analytics
Credit scoring
to predict repayment behavior.
Future purchases
Tax evasion
What Is Data Mining?
 data mining refers to business analytics methods that go beyond
counts, descriptive techniques, reporting, and methods based on
business rules.
 it includes statistical and machine-learning methods that inform
decision-making, often in an automated fashion
 “what is the relationship between advertising and sales,” vs.
“what specific advertisement, or recommended product, should
be shown to a given online shopper at this moment?”
Data Mining and Related Terms
Data mining:
digging through vast stores of (often personal) data in
search of something interesting
studying and graphing past data in search of general
trends.
predictive analytics, predictive modeling, and machine
learning
stands at the confluence of the fields of statistics and
machine learning
“statistics at scale and speed” (Pregibon, 1999).
deals with large datasets in an openended fashion
What Big Data?

Four V’s
Volume refers to the amount of data
Velocity refers to the flow rate
Variety refers to the different types of data being
generated
Veracity refers to the fact that data is being generated by
organic distributed processes
Data Science
 Statistics
 Machine learning
 Mathematics
 Programming
 Business
 IT
Data Mining Process and Techniques

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