Appendix F business intelligence and data mining

The three forms of BI must work toward a common goal

The latency between a business event and an action taken

data latency

The time duration to make data ready for analysis (i.e., the time for extracting, transforming, and cleansing the data) and loading the data into the database.

analysis latency

The time from which data are made available to the time when analysis is complete.

decision latency

The time it takes a human to comprehend the analytic result and determine an appropriate action.

data mining

The process of analyzing data to extract information not offered by the raw data alone.

Data mining process model overview

data profiling

The process of collecting statistics and information about data in an existing source.

data replication

The process of sharing information to ensure consistency between multiple data sources.

recommendation engine

A data mining algorithm that analyzes a customer's purchases and actions on a website and then uses the data to recommend complementary products.

Data mining techniques

estimation analysis

Determines values for an unknown continuous variable behavior or estimated future value.

affinity grouping analysis

Reveals the relationship between variables along with the nature and frequency of the relationships.

market basket analysis

Evaluates such items as websites and checkout scanner information to detect customers’ buying behavior and predict future behavior by identifying affinities among customers’ choices of products and services.

cluster analysis

A technique used to divide an information set into mutually exclusive groups such that the members of each group are as close together as possible to one another and the different groups are as far apart as possible.

Example of cluster analysis

classification analysis

The process of organizing data into categories or groups for its most effective and efficient use.

Classification analysis example

data mining tool

Uses a variety of techniques to find patterns and relationships in large volumes of information that predict future behavior and guide decision making.

Common DDS Analysis techniques

prediction

A statement about what will happen or might happen in the future; for example, predicting future sales or employee turnover.

optimization model

A statistical process that finds the way to make a design, system, or decision as effective as possible, for example, finding the values of controllable variables that determine maximal productivity or minimal waste.

forecasting model

Predictions based on time-series information allowing users to manipulate the time series for forecasting activities.

time-series information

Time-stamped information collected at a particular frequency.

regression model

A statistical process for estimating the relationships among variables.

agile BI

An approach to business intelligence (BI) that incorporates agile software development methodologies to accelerate and improve the outcomes of BI initiatives.