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What is data mining vs. business intelligence?
How would you compare data mining to business intelligence? Our CRM system performs some data mining features that have helped us make better decisions in the last 6 months. How does this type of feature compare to a full business intelligence solution?
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5 Answers
Ian,
they are similar concepts, but not exact. In shortest,
business intelligence will allow you to analyse and have reports out of your company data. You will have answers like "What were sales last year compared to this year for top 10 Customers"? or "What will be my future sales with current trends in Europe"?
But, if you want for your system to be able to find some hidden properties of data, you have to mine it. That's data mining. It uses real data, just like BI reports, but from that data it finds some patterns that you are not aware of.
Questions like "What is probability that a man will buy beer if he also bought snacks"?
Hope it helps,
Hrvoje.
BI is as the name spells it, Business decision making based on facts, that is taking decisions intelligently, by extracting information and knowledge from transactional data.
Data mining, is a tool that extract information from a huge data ,puzzling to the human mind, without prior assumptions or model. and ideally this tool should be part of BI, although data mining needs a lot of memory space and thus can be done in parallel then extracted information and knowledge shall be integrated into BI,
Dr. Abd Errahmane Mouhab
Business Analyst
Adnoc distribution
BI is having three essential parts as extraction, transformation and loading (ETL) software which extracts data from operational databases, then structures and organises the data into a form (or data model) suitable for efficient analyses.
The second is a set of databases and files (which may variously be data warehouses,
data marts or data cubes) which store and make available the data in its analysable
form.
The third is a set of end user tools that enable users to design, run and view reports,
queries and analyses.
Design of all these three elements for data mining (or datadriven analysis) has to be very different to the design of conventional business intelligence systems which are intended for modelbased query and reporting.
I will answer from the business perspective rather than the technology perspective. Business Intelligece is any information derived from analytics of your data that can be used strategically in the organization. Data Mining is a subset of BI or a means/process of deriving BI from data using statistical modeling of the data. It can be used to find relationships/correlations between the various data elements captured which can be used to improve business performance or at least understand what is happening better.
Part of the problem in the BI arena is that there are so many different definitions for the same terms that it can be very confusing.
My take on this: BI is about making intelligent business decision for an event that has not yet happen - based on the result churn out by DM. Meaning based on a certain pattern happened from the past, you can pre-empt or predict what will likely to happen in the future.
DM is the re-organisation of collected data from various customers' touch points, to facilitate analysis and diagnosis, and all these corresponding data-collection events were already past. DM is what actually has happened. It serves as evidence.
Say Kin Lee
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