Making Sense of Data II: A Practical Guide to Data Visualization, Advanced Data Mining Methods, and Applications

CHAPTER 5

APPLICATIONS

5.1 OVERVIEW

Data mining is being increasingly used to solve a variety of business and scientific problems. Ideally, its use is tied to achieving specific strategic objectives, such as developing a more personalized relationship with existing customers. It should also be well integrated within new or existing business processes, which are generally accepted. Careful consideration should be given to what and how specific information is collected, potentially utilizing a data warehouse to store this decision-support repository. Which data mining methods are used is just one issue within a host of concerns that need to be addressed. It is also important to address how the results are communicated and used, such as through an embedded system, the generation of reports, or through online tools. Continually monitoring the business impact of the data mining exercise is critical to ensuring the success of any project. Those organizations that are using data mining within this context are seeing a significant return on their data mining investment.

A review of how data mining is being used across a broad range of industries indicates a number of common problems are being addressed. Data mining applications are now commonly used to accomplish the following:

• Enhanced operational efficiency: Data mining can facilitate the efficient allocation of resources. For example, government departments are planning future fire stations and other resources based on an analysis ...