Managers and other decision makers always need complete and detailed information when making decisions for the business, the accuracy of data is a major determinant for the efficacy of the decisions made. This implies that businesses must collect substantial amount of data for it to be real, a major challenge with data collection is that most of data is hidden, due to the fact that so many transactions and activities take place in businesses. The data to be collected depends on which department will be bound by the decisions made. The most important data is that on the behavior of the current customers and future customers. If businesses would like to get information beyond that revealed in queries and reports, then they need to use the data mining technology.
This is a computer aided process which has the ability to dig through, and analyze a large amount of data, thereby revealing all important information in the data. Data mining uses a variety of tools to predict future trends and behaviors, and this enables a business to plan for the presents and the future properly. The major advantage with data mining is that it has the ability to give answers to questions which most traditional data handling tools could take a lot of time resolving. The data mining tools are unique enough to scour large databases to find hidden patterns, thereby finding any useful information likely to be skipped by data analysts. It does not matter whether a business is small or large, for with time it will end up with large amounts of data that cannot be easy to handle for ordinary data handling tools, so all types of businesses need data mining tools, only that the features of the data mining tools may vary considerably. With large businesses requiring more sophisticated data handling tools than the smaller ones.
Data mining is new technology that is yet to be adopted by many businesses, but already many businesses in the aerospace, health care, retails, transportation, finance, and manufacturing have adopted it. It assists to dig through the large amount of information stored and recognize important but otherwise neglected patterns, anomalies, relationships, exceptions, and facts. The information obtained is useful in trend analysis, market segmentation, direct marketing, customer churn, market basket analysis, fraud detection, and interactive marketing. This information is in various ways, associated with the creation of new business opportunities.