IDSC 3001 Quiz Six

What is wrong with "risk assessment" AI used in court?

-Algorithms are often inaccurate and based on flawed data

Data mining use case in banking

-Banking industry is data-intensive (unused ATM and credit processing data) -Important to understand customer needs and preferences -Banks are better equipped to manage market uncertainty, minimize fraud, and control risk

Use case: AI and Trading

-Data drive investments have been rising steadily over the last five years (1 trillion in 2018) -Monitor structured (databases, spreadsheets, etc) and unstructured (social media, news) in a fraction of time it would take people -Predictions for stock performance are more accurate, due to the fact that algorithms can test trading systems based on past data

What are some examples of what Business Intelligence can do?

-Determine relationships among "internal" factors (price, product, positioning) and "external" factors (economic indicators, competition, and customer demographics) -Use point-of-sale records of customer purchases to send targeted promotions -Explain what factors influence the business caused sales to be "X" one day and "Y" on another

Bias in AI

-Human biases can make their way into AI systems -Important to be aware of risks and work to reduce them -Flawed data sampling is a source of bias

Best practices of BA

-Know the objective for using BA (define business use case/goal) -Define criteria for success and failure -Select methodology and make sure you know data and relevant internal and external factors -Validate models using your predefined success and failure criteria

How does AI relate to crime?

-Potential for criminals to use AI to scam others (example: Phone call with mothers voice) -Crime detection: Crime scene clues, detecting bombs -Crime prevention: Crime spots, who will commit crime, pretrial release

EU guidelines on AI

-Published seven principles on creating "trustworthy" AI programs -Guidelines that are the "baseline" that the company has to check against when using AI -"Partnership on AI"

Challenges with BA

-Spending money/time chasing poorly defined problems -Trying to implement in fast-moving markets -Mistaking noise for insight -Trying to make it perfect -Not accessing the correct data -Time and effort to clean the data -Potential for data privacy issues

What are the three levels AI is driving change on?

-Tasks and Occupations: Example of redesign is the use of machine vision systems to identify potential cancer cells -Business processes: Reinvention of the workflow and layout of Amazon fulfillment centers after the introduction of robots and optimization algorithms based on machine learning -Business models: Take advantage of machine learning systems that can intelligently recommend music or movies

What is artificial intelligence?

-The ability of a machine to perform cognitive functions we associate with human minds, such as, reasoning, learning, and problem solving

What are four primary concerns about AI?

-The adverse impact of AI on labor -Important decisions delegated to AI (biases) -Lethal autonomous weapon systems (life or die) -Superintelligence: Risk of humanity losing control of machiens

Use case of machine learning: Autonomous trucks

-Trucks being able to move to shovel, haul to dump, etc. without operator -Generates next-generation haulage solution -Safer, more fuel-efficient, reduce congestion

What are some differences between AI and humans?

-What is easy for humans (humor, joking, sarcasm, etc) is hard on computers and vice versa (analyzing gigabytes of data) -Business needs both types

What is an example of data mining?

A midwest grocery chain analyzing buying patterns to learn that men buy beer and diapers together on Thursday

What is Business Analytics?

A practical application of statistical analysis that focuses on providing actionable recommendations

Data Mining Definition

A subset of BA useful in identifying relationships that are not obvious

What is deep learning?

A type of machine learning that can process a wider range of data resources

What is the definition of business intelligence?

A wide variety of tools, applications and methodologies that enable organizations to collect data from internal systems and external sources, prepare it for analysis, develop and run queries, create reports, dashboards, and data visualizations to decision-makers

What are the four criteria that business intelligence needs to meet?

Accuracy- of data inputs/outputs. Avoid falling into "Garbage In/Garbage Out" Timeliness- Deliver insights at the right time. Timeliness of data going in and data going out Valuable Insights Actionable- Must deliver actionable ideas designed to improve processes and profitability

What is machine learning?

Algorithms that detect patterns and learn how to make predictions, recommendations and decisions

What is deep learning a new name for?

An approach to AI called neural networks which have been around for more than 70 years

What are three types of AI?

Assisted intelligence: Humans comprehend data and generate insights Augmented intelligence: Machine learning augments human decisions Autonomous intelligence: Artificial intelligence decides and executes autonomously

What is the difference between Business Intelligence and Business Analytics?

BI answers what happened, BA answers why it happened and whether it will happen again

What is the process of analyzing data?

Before data can be analyzed, data has to be processed 1) Define why you need data analysis 2) Begin collecting data from sources 3) Clean through unnecessary data 4) Begin analyzing the data 5) Interpret results and apply them

What is often the first step for companies to take when they start to make data-driven decisions?

Business Intelligence

What are the fundamental methods of BA?

Clustering: Recognizing distinct groupings or sub-categories within the data Classifying: Example (examine a customer as credit worthy or unworthy) Estimating/Predicting: Normally yield numerical measure as the result. From existing customer, can estimate the overall indebtedness of the candidate customer Affinity Grouping: Special kind of clustering that identifies events or transactions that occur simultaneously (example- market basket analysis)

___________ is the process of discovering meaningful correlations, patterns, and trends in non-obvious relationships

Data Mining

What are some types of data used in data mining

Databases, Internal/External, Transactions, Temporal, Spatial, Space/Time, Text, Web, Graphic, Streaming, Multimedia

What are the three types of data driven decision making and what question does each answer?

Descriptive Analytics- "What happened?" Predictive Analytics- "What will happen?" Prescriptive Analytics- "How can we make it happen?"

There are concerns over the potential for AI to _______________

Displace people and increase inequality

What does modern BI software do?

Enables functional staff to analyze data themselves instead of waiting on IT to run reports

Data Mining Applications

Fraud detection, stock market price prediction, customer purchasing behavior, healthcare, education, IT security, customer segmentation, corporate surveillance, criminology, bioinformatics

What is the business phase of BI focused on?

Gathering requirements and identifying and prioritizing a list of opportunities that can have a significant business impact

What is the fundamental thing that defines an internet company?

Having architected your whole company to leverage the new capabilities the Internet gives you

What are some use cases of AI?

Healthcare monitoring Music and movie recommendations Fraud detection News generation

What is the focus of BA?

How to apply the insights derived from data

When is BI effective?

If it is trusted and used to guide human decisions

Why is data decision making important?

Organizations that can harness data analytic capabilities effectively will be able to create significant value and differentiate themselves

Data has to be _________ and ________ to be useful for Data Mining, Business Intelligence, and Analytics

Processed and Managed

What are four types of AI?

Reactive AI- Can only react to existing situations, not past experiences Limited Memory AI- Relies on stored data to learn from recent experiences to make decisions Theory of Mind AI-Capable of comprehending conversational speech, emotions, non-verbal cues and other intuitive elements Self-Aware AI- Human-level consciousness with its own desires, goals, and objectives

What is the definition of business analytics?

Software tools and applications to build models and simulations to create scenarios, understand current events and predict future states. Business analytics include data mining, predictive analytics, applied analytics and statistics. BA provides support for the process of making proactive tactical decisions. BA makes it possible for those companies to automate decision making in order to support real-time responses

What are the two types of machine learning?

Supervised and unsupervised

Two Sides to AI

Take fears about AI seriously; but don't freak out

Machine learning is the science of giving computers _____________ without __________ on what to do

The ability to learn and find insights without explicitly programming it

What is data mining?

The process of discovering meaningful correlations, patterns, and trends by sifting through large amounts of data stored in repositories

What is the goal of data analysis?

To help managers make more informed and better decisions

Machine learning is a way of getting computers ___________________________

To know things when they seem them by producing for themselves the rules their programmers cannot specify

What is the most influential variable in a data mining model?

Typically behavior-based

What is the most important step in successful BI?

Understanding the business

Data mining use case in predicting customer churn

Valpak using historical customer behavior data to boost customer retention