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Business Intelligence & ERP

Business Intelligence & ERP. Business Intelligence. Data warehouse: repository of data used for management decisions Data is gathered from operation systems and external sources Data marts: subset of data warehouse information. Business Intelligence.

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Business Intelligence & ERP

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  1. Business Intelligence & ERP

  2. Business Intelligence • Data warehouse: repository of data used for management decisions • Data is gathered from operation systems and external sources • Data marts: subset of data warehouse information

  3. Business Intelligence • Data mining: analysis of large quantities of data stored in computers • Widely used by: • Grocery stores • Banking • Insurance • Two types of data mining studies • Hypothesis testing • Knowledge discovery

  4. Business Intelligence • Hypothesis testing • A theory about relationship between actions and outcomes • Example: hypothesis that advertising will yield greater profit • Test response rates to various types of advertising on sales and profitability of product lines

  5. Business Intelligence • Knowledge discovery • Preconceived notion does not exit, but is seen by looking at the data • Done using visualization tools, statistical analysis

  6. Business Intelligence • First National Bank of ND • 10% of its customers were providing all profitability • Bank of America in San Francisco • 20% of its customers determined profitability • Developed profiles of top accounts to target services

  7. Business Intelligence • Harrah’s Entertainment Inc. • Casino organization using incentive programs • 8 million customers Total Gold cards used when gambling, eating, staying in casino • Earn points for complimentary meals & lodging • Trump Taj Card similar • Data mining is used to identity high rollers • Estimate lifetime value of players

  8. Business Intelligence • Credit Card Management • Data mining to identify “Balance Surfers” as unattractive customers • Credit card marketing promotions generate 1,000 responses to mailed solicitations – 1% response rate • Credit scoring – consolidate data for savings, loans, credit cards, insurance, retirement, etc. • Fraud alerts

  9. Business Intelligence • Farmers Insurance Group • Underwriting system that generates millions in higher revenues & lower claims • Discovered lower rates on sports cars, increase market share for product line • Insurance Fraud detection • Link names, telephone numbers, birthdays, streets, etc., to identify patterns indicating fraud

  10. Business Intelligence • Data Mining Tools • Analytic approaches • Regression • Decision trees • Neural networks • Cluster detection • Market basket analysis

  11. Business Intelligence • Data Mining Tools • OLAP tools PowerPlay & Impromptu from Cognos • SAP BW • SAS Institutes tool kit • Model 1 • IBM Intelligent Mining Toolkit

  12. Business Intelligence • Wal-Mart • Data warehouse of 101 terabytes • Includes data from point-of-sale, shipments, inventory, forecast, demographics, returns, market basket information, competition • Process 65 million transactions per week • Warehouse holds 65 weeks of data by item, by store, and by day • Handles 35,000 queries per week

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