Chapter 5 Case Study

Chapter 5 Case Study - Applebees, Travelocity, and Others:...

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Applebee’s, Travelocity, and Others: Data Mining for Business Decisions 1. What are the business benefits of taking the time and effort required to create and operate data warehouses such as those described in the case? Do you see any disadvantages? Is there any reason why all companies shouldn’t use data warehousing technology? Data warehouses store data that have been extracted from the various operational, external, and other databases of an organization (p. 191). The data is stored in one central location, where it does not change and can easily be retrieved. Data mining is one way of using the static data in data warehouses. The data is analyzed to reveal patterns and trends within business activities. This is useful for making decisions that affect a company’s strategies in the marketplace. Successfully analyzing the data and making the correct decisions to support a strategy may lead to a company gaining a competitive advantage in their industry. In the case of Applebee’s, they analyzed their data to not only help make basic business decisions, but to develop more sophisticated analyses, such as what products are selling the best and which to promote, that have made business functions (in this case marketing) more effective by appealing to customers’ needs. The major disadvantage to data warehousing and data mining is having all of a company’s information stored in one central location. This information, which may
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Chapter 5 Case Study - Applebees, Travelocity, and Others:...

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