The Microsoft® Data Warehouse Toolkit: With SQL Server™ 2005 and the Microsoft® Business Intelligence Toolset

10.1. Defining Data Mining

We generally describe data mining as a process of data exploration with the intent to find patterns or relationships that can be made useful to the organization. Data mining takes advantage of a range of technologies and techniques for exploration and execution. From a business perspective, data mining helps you understand and predict behavior, identify relationships, or group items (customers, products, and so on) into coherent sets. These models can take the form of rules or equations that you apply to new customers, products, or transactions to make a better guess as to how you should respond to them.

The field of data mining is known more broadly as Knowledge Discovery and Data Mining (KDD). Both terms shed light on the purpose and process of data mining. The word "mining" is meant to evoke a specific image. Traditional mining involves digging through vast quantities of dirt to unearth a relatively small vein of valuable metallic ore, precious stones, or other substances. Data mining is the digital equivalent of this analog process. You use automated tools to dig through vast quantities of data to identify or "discover" valuable patterns or relationships that you can leverage in your business.

Our brains are good examples of data mining tools. Throughout the course of our lives, we accumulate a large set of experiences. In some cases, we're able to identify patterns within these experiences and generate models we can use to predict the future. Those ...