Assignment:

Data mining is becoming increasingly common in both the private and public sectors.
Discuss.

1. What do you understand by DATA MINING?

Ans:-

DATA MINING OR KNOWLEDGE DISCOVERY:

As we know that Data mining or knowledge discovery is the process of

analyzing data from different perspectives & summarizing it into useful information. This
information can be used to increase revenue & cut cost or both. We know that data mining
software is one of a number of analytical tools for analyzing data. It allows users to analyze data
from many angels & categories it. It also summarizes the relationship identified.

Technically speaking data mining is the process of correlations among dozens of fields in large
rational database.

In other words it is the process of sorting through large amount of data & picking out important
information. It is often use by business intelligence organizations & financial analysts. It is also
used in the sciences to extract information from the data set generated by modern experiment &
observational methods.

Data mining in relation to Enterprise Resource Planning is the statistical & logical analysis of
large sets of transaction data looking for patterns that can aid decision making.

Although data mining is a new term but technology is not. Companies have used powerful
computers to shift through volumes of supermarket scanner data & analyze market research
report for year.

However, continuous innovations in computer processing power, disk storage etc is increasing
the accuracy of analyzing while driving down the cost.

There are also human rights & privacy related concerns with data mining, specifically regarding
the source of the data analyzed. Data mining provides information that would not be providing
otherwise. It must be interpreted to be useful. When individual people involves in data collection,
there are many questions related privacy, ethics & legality. Data mining government or
commercial data sets for national security or law enforcement purposes has raised privacy
concerns. Data mining has also become an important part of customer relationship management.

Data mining have five major elements.

Extract, transform & load transactions data onto data warehouse system.

Store & manage the data in a multi dimensional database system.

Provide data access to business analysts & information technology professionals.

Analyze the data by application software.

Present the data in a useful format, such as table or graph.

2. Study and discuss where and how DM can be used?

Ans:-

Data mining is using in Terrorism, games, business & science & engineering etc.

We know that data mining is using in terrorism now-a-days. It is the method through which U.S
Army unit identified the leader of Al Qaeda, who was involved in 11th September attack & three
other hijackers.

CIA & CSIS have put this method of interpreting data to work for them as well.

Previous data mining that is used to stop terrorist programs under the U.S government include
the Terrorism Information Awareness program, computer-Assisted passenger prescreening
system, Analysis, Dissemination, visualization, insight & semantic enhancement, MATRIX &
the secure flight program.

Now these programs are discontinued because they violate the U.S constitution’s 4th amendment.

Data mining is also used in customer relationship management (CRM). DM in CRM

applications can contribute significantly to the bottom line. Rather than contacting a customer
through a call center or through a mail, only customers that are predicted to have a high
likelihood of responding to an offer are contacted. In cases where many people will take an
action without an offer, uplift modeling can be used to determine which people will have the
greatest increase in responding if given an offer. Data clustering can also be used for
automatically discovering the segments or groups within a customer data set.

We can identity groups that are less profitable to companies by using data mining, which could
lead to discrimination against certain customers. Many companies will learn which consumers
make them the most profit & will start to direct all of their effects into making products for only
target market. This technique is very beneficial to the company because they are maximizing
profit by focusing the efforts on a specific group without wasting time & resources by selling to
a target market that might not return as much value to them.

Business employing data mining quickly see a return on investment (ROI), but also they
recognize that the number of predictive models can quickly become very large. Instead of one
model to predict which customers will churn, a business could build a separate model for each
region & customer type.

Data mining can also be helpful to Human Resources in identifying the characteristics of their
most successful employees. Strategic Enterprise Management applications also help a company
translate co-operate level goals, such as profit & margin share targets into operational decisions,
such as production plans & workforce levels.

Recently data mining has been widely use in are of science & technologies including medicine,
genetics, bioinformatics & electrical power engineering.

In genetic the important goal is to understand the mapping relationship between the inter-
individual variations in human DNA sequences. It is used to find out that how the changes in an
individual’s sequence affect the risk of developing common diseases for example cancer. It is
very helpful for improving the diagnosis, prevent & treatment of the diseases. This technique is
also known as Multifactor dimensionality reduction.

Data mining techniques is used for condition monitoring of high voltage electrical equipment in
the area of electrical power engineering. The purpose of condition monitoring is to obtain
valuable information on the insulation’s health status of the equipment.

Data mining is also use in games now-a-days. The National Basketball Association is exploring
a data mining application that can be used in conjunction with image recordings of basketball
games. The Advanced Scout software analyzes the movements of players to help coaches
orchestrate plays & strategies. Coach can automatically bring up the video clips showing each of
the jump shots by using NBA universal clock.

Today, data mining applications are available on all size systems for mainframe, client/server &
PC platforms. Systems prices range from several thousand dollars for the smallest applications
up to $1 million a terabyte for the largest. Enterprise-wide applications generally range in size
from 10 gigabytes to over 11 terabytes.

Two technology drivers are size of the data base & Query complexity.

Hence, data mining is becoming increasingly common both in public & private sectors.