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  1. 1. An Overview of Data Mining Hugh J. Watson Terry College of Business University of Georgia Athens, Georgia
  2. 2. Data Mining Is <ul><li>The automated process of finding relationships and patterns in stored data </li></ul><ul><li>It is different from the use of SQL queries and other business intelligence tools </li></ul>
  3. 3. Data Mining Is <ul><li>Motivated by business need, large amounts of available data, and humans’ limited cognitive processing abilities </li></ul><ul><li>Enabled by data warehousing, parallel processing, and data mining algorithms </li></ul>
  4. 4. Common Types of Information from Data Mining <ul><li>Associations -- identifies occurrences that are linked to a single event </li></ul><ul><li>Sequences -- identifies events that are linked over time </li></ul><ul><li>Classification -- recognizes patterns that describe the group to which an item belongs </li></ul>
  5. 5. Common Types of Information from Data Mining <ul><li>Clustering -- discovers different groupings within the data </li></ul><ul><li>Forecasting -- estimates future values </li></ul>
  6. 6. Commonly Used Data Mining Techniques <ul><li>Artificial neural networks </li></ul><ul><li>Decision trees </li></ul><ul><li>Genetic algorithms </li></ul><ul><li>Nearest neighbor method </li></ul><ul><li>Rule induction </li></ul>
  7. 7. The Current State of Data Mining Tools <ul><li>Many of the vendors are small companies </li></ul><ul><li>IBM and SAS have been in the market for some time, and more “biggies” are moving into this market </li></ul><ul><li>BI tools and RDMS products are increasingly including basic data mining capabilities </li></ul><ul><li>Packaged data mining applications are becoming common </li></ul>
  8. 8. The Data Mining Process <ul><li>Requires personnel with domain, data warehousing, and data mining expertise </li></ul><ul><li>Requires data selection, data extraction, data cleansing, and data transformation </li></ul><ul><li>Most data mining tools work with highly granular flat files </li></ul><ul><li>Is an iterative and interactive process </li></ul>