Benefits of Data Mining

Data mining is defined as â€Å"a process that uses statistical, mathematical, artificial intelligence, and machine-learning techniques to extract and identify useful information and subsequent knowledge from large databases, including data warehouses† (Turban & Volonino, 2011). The information identified using data mining includes patterns indicating trends, correlations, rules, similarities, and used as predictive analytics. By employing predictive analytics, companies are actually able to understand the behavior of customers. Predictive analytics examines and sorts data to find patterns that highlight customer behavior. The important behavioral patterns are those that indicate what customers have responded to and will respond to in the future. Also, patterns can indicate a customer base that is in jeopardy with the company, customers that are not company-loyal and are easily lost. Predictive analytics of customer behavior can be of great benefit to the business (Turban & Volonino, 2011). Companies are able to build specific marking campaigns and models such as direct mail, online marking, or media marking based on customer preference and are better able to sell their products to a more targeted customer base. Knowing what the customer wants, what they will respond to, and which customer base to focus on takes the guesswork out of marking and product development. Taking the information retrieved and using it correctly will only increase profits (Advantages, 2012). Association discovery using data mining provides a huge benefit to companies. Association discovery is finding correlations or relationships between variables in a large database. For example, in terms of a supermarket, it is finding out that customers who buy onions and potatoes together are also highly likely to buy hamburger meat. These correlations where one set of products predict the buying of another is referred to as associations. Data mining can employ association discovery allowing business to predict buying patterns and allow for more effective operations management and can better pinpoint marketing strategy of coupons and incentives (Association Rule 2012). Web mining is another aspect of data mining. Web mining uses the data collected on the Internet to analyze customer data and gather information beneficial to the company. Any time someone visits a website, uses a search engine, clicks on a link, or makes an electronic transaction data is generated subject to analytics. Companies use web mining to gain customer preference and insight. The information gathered is used to improve websites and create a better user experience for the customers. Web mining can also be used alongside of predictive analytics. For example, on e-commerce sites every transaction is analyzed. When a customer clicks on a product, web mining tools can present a list of products he/she may also be interested in because of other customers with the similar buying interests/habits. This tool can be extremely effective in gaining business intelligence of the buying habits and preferences of customers (Turban & Volonino, 2011). Data mining also employs clustering to find related customer information and to provide valuable information to the company. Clustering gathers information and designates clusters of similar products and objects. In data mining, clustering is usually the first step. It identifies similar information and groups them to be further examined. Customer information and demographics are an example of these clusters. The group characteristics are analyzed against desired outcomes to understand the buying habits of customers and what marketing campaigns will enhance customer response (Ali, Ghani, & Saeed). Reliability of Data Mining The benefits of data have been examined, but it is important to look possible implications as well. Data mining uses algorithms to predict patterns and customer behaviors. Constant measures are needed to make sure the algorithms are working correctly, but the issue of reliability stems a little deeper. Algorithms and data analysis can only be as reliable as the actual data analyzed. Data gathered from different sources can potentially be t or even conflicting. This greatly affects the validity and result of algorithm, especially predictive analysis. It could alter the customer’s historical purchases or demographic information rendering the information useless and even costly. Data mining is a useful tool and should be trusted up to a point. It should not be the only solution. Companies should not only use data mining for marking and operations decisions. The costs of mistaking customer preference and predicting behavior could be catastrophic (Data Mining). Privacy Concerns of Data Mining. One of the major disadvantages of data mining is the privacy concerns associated with the technique. Three major privacy concerns raised by consumers are identity theft, misuse of personal information, and the â€Å"big brother is watching you† feeling (Orwell, 1954). The first concern is identity theft. With the increasing trend of e-commerce and electronic funds, identity theft has been a huge issue. The sheer amount and speed of information processing through data mining has led to a rise in identity theft making this valid concern. The information could easily fall into the hands of anyone (Exforsys Inc, 2006). The second concern is the misuse of personal information. Companies gather information as specific to customer purchases, names, phone numbers, addresses, and other information then store it in a database. Once obtained, copies can be made with little effort. Companies can easily sell this information to other companies. This is the exact concern of consumers. Consumer information can certainly be misused, exploited, or for discrimination making this a valid concern (Advantages, 2012). The last concern addressed in this paper is the total loss of privacy, feeling controlled or watched. The government uses data mining to track patterns of criminal activity have considered using the technique to track the movement of people. Some people feel this goes too far, and not giving the consumer the choice of having his/her information in the database takes away personal freedom. This concern is tied into the misuse of information because what stops companies to selling information to governmental or private agencies with the sole purpose being to control or watch an individual. With the volatile nature of crime, and the increasing use of technology by government agencies, this concern is also valid (Advantages 2012). Measures have been taken to alleviate these concerns. Companies that utilize data mining are required to take certain actions that protect their customer’s privacy. One of these actions is to remove and identity related attributes from each customer record before the data is transferred to analysts. Also banks allow for identity theft protection services to alleviate the concern of financial security. All of these concerns are still important and steps will have to be continuously made and adjusted to protect the security and privacy of personal and financial information (Li & Sarkar, 2006). Real World Examples of Predictive Analytics Predictive analysis and how it is beneficial to companies has been discussed above in theory. To completely understand how predictive analysis is used is to look at real world examples. The first example is how a fast food restaurant used HyperActive Technologies to predict what customers might order. HyperActive Technologies developed a system that allowed cameras to track vehicles pulling into the parking lot and track customers through the entire ordering process. Using predictive analysis of the data gathers from the cameras, the restaurant was able to conclude that at lunchtime; approximately twenty percent of cars entering the parking lot would order at least one cheeseburger. With this information, the cooks were able to get a head start in food production cutting down on wait time for customers and increasing overall productivity (Turban & Volonino, 2011). Another example of a company that uses predictive analysis is that of INRX, the leading provider of traffic information. INRX uses data mining by evaluating real time traffic measuring traffic problems and congestion. This data is collected from road censors, toll tags, traffic incident data, and commercial vehicles equipped with a GPS that continuously report their speed and location. Using predictive analytics, the data is studied to determine traffic patterns at certain locations and times. Drivers now have access to real time traffic information. This information has proven to be extremely effective and useful to drivers allowing them to make better decisions and avoid unnecessary delays (Turban & Volonino, 2011). The flower company, 1-800-FLOWERS. om, has also used data mining techniques, specifically predictive analytics. The company collects and analyses data at all contact points. Data collected includes historical purchases to discover trends, anticipate customer behavior, and meet customer needs and preferences. This technique has proven to be an effective way of increasing the response rate to customers, identifying profitable customers, and establishing customer loyalty. Customer reten tion increased by over fifteen percent after the implementation of predictive analytics solidifying its effectiveness (Turban & Volonino, 2011). As shown through academic research and real world examples, data mining is a real and effective way of predicting customer behavior and buying patterns. Measures need to be taken not only to overcome the stigma that data mining is unsecure and takes away personal freedom, but to make sure individual information is, in fact protected. If these measures are taken, data mining is a win-win for both businesses and consumers. Consumers will feel heard, understood, and taken care of. Businesses can actually focus resources on building that business-to-customer relationship and will be able to give the people what they need. References Advantages and disadvantages of data mining (2012). Retrieved December 9, 2012 from http://www.dataminingtechniques.net/data-mining-tutorial/advantages-and-disadvantages-ofdatamining/ Ali, R., Ghani, U., & Saeed, A. (n.d.) Data clustering and its applications. Retrieved December 5, 2012 from http://members.tripod.com/asim_saeed/paper.htm Data mining: issues. (n.d.) Retrieved December 7, 2012, from http://www.anderson.ucla.edu/faculty/jason.frand/teacher/technologies/palace/ issues.htm Exforsys Inc. (2006). Data mining privacy concerns. Retrieved December 5, 2012 from http://www.exforsys.com/tutorials/data-mining/data-mining-privacy-concerns.html Li, X. & Sarkar, S. (2006) Privacy protection in data mining. Retrieved December 6, 2012 from http://dl.acm.org/citation.cfm?id=1245621 Turban, E., & Volonino, L. (2011). Information technology for management improving strategic and operational performance (8th ed.). New Jersey: John Wiley & Sons, Inc.

How can we make globalization something that brings prosperity to Essay - 1

How can we make globalization something that brings prosperity to everyone - Essay Example Wal-Mart had a net income of 12,731,000,000 on total revenue of $378,799,000,000 in accordance with documents filed by SEC in 2008. By opening trade with other countries, the ability to dictate what is being produced and how, and giving consumers more power, globalization thus helps to flood the market. In a situation where consumers collectively buys only environmentally friendly products, then companies would be forced to a transition to meet our demands thus making a world a cleaner place. Thus, globalization contributes to a sustainable property for all. This helps the people get above the poverty line by increasing competition that in turn helps to bring down the prices of commodities or, services. The competition for goods and services is affected by globalization e.g. the price of goods and services is brought down by increasing their supply. Thus, globalization will help benefit the world. According to the video, De Soto thinks globalization is limited in its current form. Ma jority have been left out in terms of the legal structures that give rise to it. Globalization must actually include the majority of the people on earth to be truly worth its name. it links elites from the post-soviet world and the developing world to the world economy. The legal revolution that has been taking place especially in the west is because of the market economic system. De Soto argues that if these market institutions are brought down, it could take another few centuries to develop. Hernando De Soto is one person that believes in the power of trade. His hard work helped to get the US-Peru Free Trade Agreement passed. He also always speaks out in favor of giving the poor access to wider markets. Elites can only be globalizing with the current existing globalization. Elites can only gain access in developing countries, because the costs of entry are high. Increased trade and open markets are key to eliminating poverty. Once the poor enter the legal system and have access th ey need, they will definitely prosper as per the evidence gathered by the institute of liberty and democracy (ILD). There are many overall benefits of trade. According to law of comparative advantage, the less productive countries will benefit from trade with countries that are more productive. This is because producers who are stronger can trade in order to free up resources thus enabling them to specialize. The lower prices that an economy of scale and specialization engenders are some of the things that the customers will benefit from. The video clearly illustrates that globalization process had already taken place in the late 19th century. The foreign investment and trade were fairly globalised before world war1. Labor markets were more globalised at the beginning of the twentieth century than at its end simply because of low political obstacles to international migration. The great depression and two world wars halted the process of global market integration for almost half a c entury. The process later regains speed and force. Due to faster, reliable and inexpensive transport and communication, some service providers and producers of goods in low-wage countries have been able to challenge high-cost producers in rich countries on

Strategic Business Information Systems - Cirque du Soleil's Essay

Strategic Business Information Systems - Cirque du Soleil's Information Technology Initiatives - Essay Example Both the strategies can be approached narrowly or broadly and in either case there is the third viable competitive strategy that is ‘focus’. (12manage.com) Ward and Peppard (2002) have identified that IS/IT strategy formulation and planning will help an organization to gain competitive advantage in the existing market by enabling the organization to develop a flexible and cost effective technology infrastructure which in turn will lead to the deployment of resources and competencies that are needed to accomplish the organizational goals effectively and efficiently. By using latest technology Cirque du Soleil could develop a new intellectual and dramatic entertainment project that made the company stand out unique. The use of technology has helped the company to reduce its cost structure and the organization could increase the ticket prices beyond the amount charged by the traditional circuses. This also made the organization compete with the Broadway theatre prices. (Chan Kim and Renee Mauborgne, 2005) The success of Cirque du Soleil lies in their ability to create a new and compelling product rather than creating a new market. It cannot be said the business of Cirque is an alternative to traditional circus business (Blue Ocean Strategy) but through a product differentiation as advocated by Porter (1980) Cirque competes in the existing market with a brand new product having different characteristics. This makes the product of Cirque unique. The strengths and weaknesses of Cirque du Soleil can be analyzed using a SWOT analysis. Cirque du Soleil is able to have distinct competitive advantageous position due to three fundamental reasons. They are: (i) Product differentiation advantage – by employing innovative production techniques the organization is able to make shows that evoke awe, wonder, inspiration and reflection among the customers, (ii) Niche competitive advantage – the production of Cirque

Reply to Sor Filotea de la Cruz Essay Example | Topics and Well Written Essays - 750 words

Reply to Sor Filotea de la Cruz - Essay Example The letter highlights the efforts this lady has taken to gain knowledge in order to alleviate ignorance. It campaigns for equality in opportunities to both men and women by women rising to their feet and grabbing chances of obtaining erudition. Women lack competence because of deficient of education. In the most important parts of the letter, the nun talks about stereotyping. How she fought odds and wished to be treated like a man with respect and being given equal opportunities like them. She however was respectful to orders and instructions so that her religious values cannot be eroded. It was also mandatory for a woman to be reverential and submissive to men and any one of older age. She yearned for education and dreamt of even going to the university as boys did. She abstained from certain foods for fear of being dumb as they claim they made one. She wanted an equal place as the other gender but it clearly was not possible at that time. She had a thirst for knowledge and did what she could in her capacity to learn of the most important things she felt she wanted to know about. In this letter she has claimed that the people in her relation criticized her inclination to knowledge citing that it would make her lose her religious strength and make her weak (Stephanie 45)Â  . Th is was the most difficult time for her because obviously support in any person’s Endeavour is always helpful. She loved their companionship and sometimes thought it deprived her of the chance to study. Jealousy, she learned was bound to happen towards an intelligent person especially if the person is a woman. Women are despised and their place regarded as the home only and it would be struggle if they ventured in territories where they are supposedly not to be. One particular example she has used is that of Peter who gained knowledge and was executed. The crown of thorns she has cited, after it witnessed Christ’s persecution declare that aptitude is scorned.

Current Issues in Parent-Child Relationships Research Paper

Current Issues in Parent-Child Relationships - Research Paper Example Children may not recognize the love and affection of the parents which may result in developing negative attitudes towards the parents. Parents on the other hand may think that they are working hard in order to make the future of their children safe; but in return they are getting only negligence and embarrassments. Both, the parents and the child travel in extremely opposite directions which may be resulted in strained parent-child relationship. Neither of them will be satisfied with their living conditions even though money may not be a problem for them. Psychological problems may affect both the parent and the child which may ultimately resulted in unhealthy incidents in the family. Latch –key-kids are more in Canada and it became a social problem now. In fact social service agencies are trying to find out a solution for it in various manners. The Latchkey Kids calling program is a system developed by Database Systems Corp. (DSC) in order to help such kids. â€Å"This program is an integral part of the CARE (Call Reassurance) phone system that checks on the well being of home alone children as well as senior citizens who need regular contact† (Care). I want to learn about the emotional problems of latch-key-kids. This is because of the fact that a psychologically disordered child can create lot of family and social

Textbooks should be replaced by electronic books Essay

Textbooks should be replaced by electronic books - Essay Example It will provide empirical evidence in support of this line of thinking. With the advent of technology, Americans consumers particularly the students can find relevant academic material at their fingertips. Electronic books allow people to access any book at any time and place. In addition, it is cheap to produce electronic compared to paper books. The reason is that it allows publishers to produce and distribute these books at a fractional cost compared to the latter. Many Americans would not have believed that gramophones would be replaced with tapes and payphones by portable cell phones to name a few. Today, most magazine publishers have moved away from print media and currently produce their magazine entirely as materials viewable in e-readers (Conway, 2010). Below is an analysis on the benefits of electronic books over textbooks. First, electronic books are cheaper relative to paper books. In the US, the average price of a textbook is about $8. However, one can still get that same material for $3 on a kindle. In additional, production of paper books involves the cutting down of trees and hence resulting to environmental degradation. Adoption of electronic books would ensure the conservation of the environment and reading will become easier. Secondly, electronic books are so accessible and as a result, they have become very popular in the recent years. Instead of waiting for the delivery of a book shopped online, one can purchase and download an e-book within no time (Polatron, 2009). Additionally, they are less cheap since the publishers do not have to add any production cost. For this reason, electronic books are a great alternative to textbooks. Thirdly, Proponent of electronic books argues that both students and teachers support them since they are lighter and hence convenient to use. Electronic books can hold the material of close to hundred or more

Modern Furniture Evaluation Essay Example | Topics and Well Written Essays - 1250 words

Modern Furniture Evaluation - Essay Example Preferred stock is a class of ownership in a corporation that has a higher claim on the assets and earnings than the common stock. Preferred stock generally has a dividend that must be paid out before the dividends to common stockholders and the shares usually do not have voting rights. Each company can work out the details pertaining to the issue of preferred stocks. However preferred stock can be considered as a financial instrument that possesses the characteristics of both debt (with fixed dividend) and equity (potential appreciation). (Investopedia) A convertible debt or security is a bond or a share of preferred stock that can be converted at the option of the holder into common stock of the same corporation. The investor is provided with a fixed return from a bond or with a specified dividend from the preferred stock. In addition the investor has an option to covert it to common stock. As a result the company is able to sell a convertible security at a lower yield than it would have to pay on a straight bond or preferred stock issue. This is an advantage for issuing convertible securities. (James C.Van Horne) A Warrant is an option to purchase a specified number of shares of common stock at a stated price. When the holder of a warrant exercises his option he surrenders the warrants. Warrants are often employed as 'sweeteners' to a public issue of bonds or debt that is privately placed. As a result the company should be able to obtain a lower rate of interest than it would otherwise. For companies that are marginal credit risks the use of warrants may make the difference between being able and not being able to raise funds through a debt issue. Occasionally warrants are directly sold to investors directly against cash. On other occasions they are used in founding of the company issued as compensation to underwriters and venture capitalists. Mostly warrants are issued in connection with a debt issue often a private placement. (James C.Van Horne) A primary financial instrument evidences a direct claim against some other party. These instruments often are traded in the spot market with prices set by the usual forces of demand and supply. In contrast a derivative security derives its value from an underlying primary security. One of the examples for the underlying security for derivatives is the stock option. Movements in the price of the underlying asset, the stock in this case drive the value of the derivative instrument, the option. Derivatives may take the form of simple put and call options on stocks. These options were traded in relatively illiquid over the counter markets. However with the tremendous financial innovations occurred in the last two decades the role of derivative securities in the financial markets have increased manifold touching new heights. (James C. Van Horne) Modern Furniture Company Total Number of shares outstanding: 3,000,000 Cash Dividend Proposed: $ 1.60 per share Total Earnings of the firm $ 12,000,000 Earnings per share $ 4.00 Market Value of the Share $ 88.00 P/E Ratio P/E Ratio is given Market Value per Share Earnings per Share 88.00 4.00 = 22 Dividend Yield and Dividend Payout Ratio Dividend Yield is given by Annual Dividends per