ADVANCED TOPICS IN INFORMATION SYSTEM

DATA MINING AS BUSINESS SOLUTIONS

Oleh :

Juendi 1601234133
Kelas :
06 LD11
 ABSTRACT
Evolving information technology makes our daily life easier, as well as data transmission.
Over time, each company primarily property insurance company that continues to grow is
certainly generates a large amount of data or a lot of data such as customer or client. The amount
of data that so many would require large storage capacity and require a system that can help
companies in the process of analyzing large amounts of data so that it becomes a useful
information for the company, of course, in the decision-making process. Data Mining is a
solution that can help companies to collect data, classifying the data and analyze large amounts
of data. Because that data mining is required by companies that produce or require large data or
many, generally using data mining companies such as insurance companies and corporate
franchise or retail business that has great scope.

KEYWORDS : data, data mining.

 BAB 1
INTRODUCTION
1.1 Background
Property insurance company is one of the companies engaged in the service or services.
Property insurance companies have an important role to protect the client's home or his shop
from a variety of disasters such as fire, lightning, explosion, theft with violence, and so on. With
the property insurance company can provide a solution to the community to protect valuable
assets, namely property (home or store) that can be known that either the home or property prices
increasing store. As for the use of this insurance are, of course the client must pay a premium that
has been determined by the company. Briefly premium is the amount of fees to be paid by the
client to obtain insurance protection or the protection of uses.

Current advances in information technology has been growing rapidly. It is characterized

by the increasing number of information technology in various fields and information technology
have been very attached to us. Every day we definitely highly dependent on information
technology, such as communication through the gadget, receiving and sending data, and so on.
Information technology is helping us to do an activity, and the presence of information
technology can help a company to develop its business. Companies that apply information
technology will be able to compete with other companies, more effective and efficient so that
more superior than companies that do not use information technology.

By utilizing information technology, companies can conduct their business process

workflow with faster and more accurate data processing. The data will be stored in a storage area
or known by the term database (database) that may facilitate the company to find out information
that is important for the life of the company's business. The data is stored into the database is not
a physical data such as papers, books, and so on, but the data in the form of a file stored in a
computer device that serves as a storage media and data processing. Of course using these
databases can reduce the occurrence of data loss or data that is repetitive, meaning there is more
than one of its data contents of the same. As the company grows, the data and information owned
companies are also increasingly numerous and complex or complicated, resulting in a new
problem in this analisis.Hal can hamper corporate executives in analyzing the data used to make
strategic decisions that required the company for the future.

To overcome this, the company must have an application that is able to perform analyzes
and generate the necessary information to the appropriate management . Information technology
in question is Data Mining . Data Mining is a database of companies which has the function to
process and assess the characteristics of any existing data on the company to assist the
management in the decision making process . Assessment of the satisfaction of the client to the
insurance company , type of insurance that is most widely used by the client and the type of
work that clients using any of this insurance , it can be described through data mining so that the
company can find a business plan for the future looks like. Suppose that using the average
insurance is an entrepreneur , then the company can conduct a campaign in places such as the
wholesale centers that its contents entrepreneurs .

1.2 Scope
In this paper , we will discuss several points , namely :

A. Types of Property Insurance

Knowing what types of insurance are contained in the property field .

B. Differences in Data Warehouse and Data Mining

It is important for us to know the difference from the data warehouse with data mining ,
so we can distinguish what is the use of data warehouse and data mining .

C. Architecture Data Mining

An overview of the general architecture of data mining that describe the work flow or
stages of making data mining .

D. Stages of Data Mining Process

It is important for us to know the phases of the data mining process is like, from the
initial stage to the final stage .

E. Software Data Mining

Some examples of the usefulness of the software or data mining software from several
vendors of IT , so that we can determine what data mining software that fits the needs of the
company.

1.3 Methodology of Writing

The methodology used in writing this paper , among other literature studies .

1.3.1 Studies Library

I did a search of books , magazines , articles , or scientific journal in making this paper .
1.4 Goal and Benefit
The purpose of writing this paper :

1. Knowing the types of insurance in property ,

2. Knowing what the difference data warehouse and data mining ,

3. Knowing the general description on the architecture of data mining ,

4. Knowing any stage of the process in data mining ,

5. Knowing what software or data mining software from various vendors .

The benefit of writing this paper :

1. Can determine the type of property insurance that suits your needs ,

2. Can understand the differences in data warehouse and data mining ,

3. Can understand the architecture of data mining ,

4. Can learn the stages in the process of data mining ,

5. Can specify the software vendor or data mining software as needed .

 BAB 2
THEORITICAL FRAMEWORK
2.1 Understanding Data
According to Turban (2010, P41), the data is a basic description of objects, events,
activities and transactions are recorded, classified, and stored but not yet have a meaning.
Meanwhile, according to Keri E.Pearlson, Carol S. Saunders (2009, p13), the data is a particular
set of facts in the form of a stand-alone that has intrinsic meaning, but can be easily captured,
and sent, stored electronically.

According Indrajani (2009, p2), the data is raw facts or observations about physical
phenomena or the usual business transactions and data are objective measures of the attributes or
characteristics of entities such as people, objects, places and events. Representation of fact which
represents an object such as customers, suppliers, employees, students, lecturers, students and so
on are stored in the form of numbers, letters, symbols, text, sounds, images and so on.

Based on the above understanding, it can be concluded that the data is a collection of a
collection of facts obtained from events that occurred and the collection was recorded, classified
and stored in various forms.

2.2 Understanding Database

According to Kroenke and Auer (2010 , p8 ) , database or database is a collection of
related data between the data with other data and other structures . Meanwhile, according to
Turban ( 2009 , P108 ) , the database is a collection of files that store data that are interconnected
and associate one with the other , the stored data can affect the speed of the user to access ,
response times on queries, data entry , security and costs .

According Abdillah (2012 , p1 ) explained that the database is two or more data by
connecting data elements that can be accessed in various ways . Meanwhile, according to
Iskandar and Rangkuti (2008 , p3 ) says that the database is a collection of data related to each
other data .

So the database is data storage that is mutually integrated and interrelated with the
connecting elements which can be accessed in various ways .
2.3 Understanding Data Mining
According to Han et al (2011 , p6 ) explains that data mining is the selection of a data or
by the term gain knowledge from vast amounts of data . In addition , Han et al (2011 , P36 ) to
explain again that data mining is the process of finding an interesting pattern , and knowledge of
large amounts of data . Meanwhile, according to Segall , Guha and Nonis (2008 , p127 ) explains
that data mining is called the discovery of patterns that artifacts on the data and data mining is
the process of analyzing data from different perspectives or views , collects data and specifies the
data that becomes information useful .

Based on the above understanding , it can be concluded that data mining is a process that
analyzes large amounts of data or a lot and make a pattern to be useful information to users.

2.3.1 Characteristics Data Mining

According to Turban (2007 , P230 ) describes some of the characteristics of data mining ,
namely :

1 ) Data are often buried in a long time are usually many years in the database ,

2 ) Environmental data mining in the form of client-server architecture and system architecture
information ,

3 ) an advanced tool such as additional visualization tool that helps remove the layer of
information buried in files or records ,

4 ) drill data and query tool that supports the control of the user to ask questions and get an
answer as soon as possible ,

5 ) data mining tool which is combined with a spreadsheet and other software tools
development ,

6 ) parallel process for data mining helps in the search for large amounts of data .
2.3.2 Function Data Mining

According to Maclennan et al (2009 , p6 ) describes some of the functions of data

mining , namely :

1 ) Classification

Serves to classify the target class into that category will be selected.

Figure 2.1 Classification - Decision Tree

Source : Maclennan et al (2009 , p7 )

2 ) Clustering

Function to look for grouping attributes into segmentations based on similarity .

Figure 2.2 Clustering

Source : Maclennan et al (2009 , p7 )

3 ) Association

Works to find the relationship between an attribute or item set based on the number of
items that appear and existing association rule .
Figure 2.3 Product Association

Source : Maclennan et al (2009 , p7 )

4 ) Regression

Function to search for the prediction of an existing pattern , almost similar to the
classification .

5 ) Forecasting

Serves to forecasting future trends based on the time that has happened before.

Figure 2.4 Forecasting

Source : Maclennan et al (2009 , p8 )

6 ) Sequence Analysis

Function to search for a pattern sequence of a series of events .

Figure 2.5 Web Navigation Sequence

Source : Maclennan et al (2009 , p9 )

7) Deviation Analysis

Function to search for rare events or events that are unprecedented and events were very
different from the normal state .
 BAB 3
DISCUSSION
3.1 Types of Property Insurance
To determine the types of insurance are contained in the field wrote the property ,
following the division of the types of property insurance , according Asuransi Central Asia or
known as the ACA Insurance , that there are four types :

3.1.1 fire insurance

Figure 3.1 Fire Insurance ACA

Source: www.aca.co.id
 What can be insured ?

1 ) Building ,

2 ) Household Furnishings ,

3 ) Housewares ,

4 ) Machine ,

5 ) Merchandise .

What is covered?

1 ) Fire ,

2 ) Lightning ,

3 ) The explosion and smoke ,

4 ) Landslide ,

5 ) Flood ,

6 ) Damage caused by riots or accidents .

Is there a risk that is not covered?

1 ) Fires caused by negligence ( short circuit in an electric or gas cylinder explosion ) ,

2 ) Damage caused by the war ( bombing , nuclear radiation ) .

Anyone who needs this product ?

Any individual or business entity that has an interest in the property insured as : owner ,
tenant , bank or financial institution lenders .
3.1.2 Theft Insurance and Demolition

Figure 3.2 Theft Insurance and Demolition ACA

Source : www.aca.co.id
What can be insured?

1) Possessions such as: computers, laptops, televisions, refrigerators, air conditioners,

piano, and so on.

Each property to be insured shall be given a detailed description, such as: brand, type,
year of manufacture, purchase price, number of units. These details are very necessary, the
number of units. These details are required both by customers and insurers. Why is that? In case
of burglary, the customer is easy to make a claim in the form of goods to the specifications as in
the appendix at the same insurance policy forecasts the losses occurred.

What is covered?

Loss of items due to theft which preceded acts of violence or coercion or followed by the
destruction of the building. In addition, guaranteed also damage to goods or buildings as a result
of this violence.

Is there a risk that is not covered?

Damage caused by the actions themselves or family members and Losses can be insured
through fire insurance or insurance of glass; securities, shares, banknotes, coins, documents and
the like, unless explicitly stated in the summary of the policy; war, riots and the like; government
regulations

Anyone who needs this product?

Company or individual who has insured the building first with a fire insurance policy.
Buildings insured property is located may be residential buildings, offices, kiosks, cafes, garment
factories or other businesses.

3.1.3 Ideal Home Insurance

Figure 3.3 Ideal ACA Home Insurance

Source : www.aca.co.id

Why is the Ideal Home Insurance ?

1 ) complete protection ,

2 ) The cost of low premiums ranging from Rp 100,000 , - per year ,

3 ) Claims quickly with a warranty claim within 14 working days ,

4 ) Pay the cost of premiums easy to use ATM BCA , Credit Card, Mobile Banking ,

5 ) To provide additional benefits such as architect's fees , cost of firefighters , the cost of
cleaning debris , without any additional premium costs ,

6 ) Without the survey process for a house in a residential complex .

What is covered?

1 ) Fire , lightning , explosion , smoke ,

2 ) Riots ,

3 ) Theft with violence ,

4 ) Liability against third parties ,

5 ) The cost of architects , surveyors and consultants ,

6 ) Damage to deliberate in order to prevent the fire spreading ,

7 ) The cost of the fire department ,

8 ) Damage caused by accident ,

9 ) Cleaning debris .

Warranty Extension ?

1 ) Hurricanes , storms , floods and water damage ,

2 ) The earthquake , tsunami , eruption of volcanoes and landslides .

3.1.4 Shop Insurance

Figure 3.4 Insurance Stores ACA

Source : www.aca.co.id

What is covered?

1 ) Fire , lightning , explosion , smoke ,

2 ) Compensation for the interruption of business operations .

3 ) Loss of money ,
4 ) Losses due to transport of goods ,

5 ) Personal accident insurance subs working hours,

6 ) The cost of treatment due to an accident .

Additional Benefits ?

1 ) The cost of architects , surveyors and consultants ,

2 ) Costs Fire Department ,

3 ) Cost of addresses in the vehicle ,

4 ) The cost of cleaning debris ,

5 ) As a result of being hit by vehicles ,

6 ) Free appraisal value of the sum insured of claims incurred ,

7 ) Replacement paid without depreciation ,

8 ) After the claim , the policy value is restored automatically ,

9 ) Non prorate .

3.2 Differences in Data Warehouse and Data Mining

Data warehouse and data mining are two different things. In the data warehouse is a
common database containing summary or summary (recap) for a specific subject that is already
known. For example, the management company wants to find out information about the sale of
the products most frequently, then the data warehouse recap entered sales data from the database
of sales transactions in the form of ordinary table. This table should only be to take his data and
can not modify or delete the contents of the data in the table. Results of this recap would
normally be displayed in graphical form that makes it easy to be understood by management, so
as to facilitate the process of analysis and decision making. While data mining is the process of
processing the data to obtain information that is not yet known what information is contained in
the data set. Data mining is also a process to gain knowledge and new information from a large
number of data in the data warehouse, web articles, multimedia (images, sound, video) and
documents (files). Data mining is necessary to manage very large data to facilitate the recording
of a transaction activity and to process data warehousing in order to provide accurate information
for its users.
3.3 Architecture of Data Mining

Figure 3.5 Architecture Data Mining

Source : Olson & Delen (2008 , p10 )

According to Olson & Delen (2008 , p10 ) there are several grooves or work stages of making
data mining :

1 ) Business Understanding

Determine the company's business objectives , assess the current business situation , and
the purpose of making data mining .

2 ) Data Understanding

Finding and collecting the data used by considering the requirements of the required data.

3 ) Data Preparation

Processing the data to fit the needs of data mining .

4 ) Model Building

Making the initial analysis , sharing of training and testing data sets , data mining and
modeling used .

5 ) Testing and Evaluation

Checking the level of accuracy of the model was made and evaluate it.
6 ) Deployment

Make an application program user interface from the data mining to display to the user of
the results of the model are made .

3.4 Stages Data Mining

3.4.1 Data Cleaning

The first step in the data mining process steps are data cleaning. Its function is to remove
and replace the inconsistent data, it has no value, irrelevant or are writing errors when inputting.

3.4.2 Data Intergration

At this stage it does merging data from multiple tables into a new table. Not infrequently
if data necessary for data mining comes only from one table only, but also from some tables and
some files were covers.

3.4.3 Data Selection

At this stage is the stage of the election or selection of relevant data that is currently on
the table, not all data is only appropriate data for analysis to be taken from the table. In this study
after data cleaning phase and the data phase Intergration already done, done selecting attributes
to select relevant data or in accordance with the analysis based on company needs.

3.4.4 Data Transformation

At this stage, the data that has been selected at the stage of selection of data to be used for
the manufacture of data mining models. Data mining models is useful to perform the process on
the data to be used for the analysis process generates very useful information on the company
and the resulting information can be used in making a decision.

3.5 Data Mining Sofware

Here are some examples of software or data mining software:

1) Orange
open source data visualization and analysis for beginners and experts,
Data mining through visual programming or Python scripting, used for bioinformatics
and text mining.
Equipped with features for data analysis.
Figure 3.6 Example of Data Mining Software Orange

Source : www.orange.biolab.si

2) Weka

Weka is a Java -based software language and set of machine algorithms for data mining tasks
. The algorithm can be applied directly to a dataset or called from your own Java code . Weka
contains tools for data pre - processing , classification , regression , clustering , association rules ,
and visualization .
Figure 3.7 Example Weka Data Mining Software

Source : www.cs.waikato.ac.nz

3) R

R is a software for statistical computing and graphics . R can be run on multiple platforms
such as UNIX , Windows and MacOS

Figure 3.8 Example of Data Mining Software R

Source : www.r-project.org
 4) Microsoft Analysis Services

Microsoft analysis services is a data mining software made by Microsoft . This software is
based on SQL Server Analysis Services to build a model of analysis that can be used for
interactive analyze the data , the data reporting and data visualization . SQL Server provides a
comprehensive model to support the right solution .

Figure 3.9 Example of Data Mining Software Microsoft Analysis Services

Source : www.microsoft.com

5) Oracle Data Mining

Oracle Data Mining (ODM) provides data mining functionality as SQL functions in the
Oracle database . ODM enables users to find information hidden in the data . With the ODM can
build and implement predictive models that help companies to target loyal customers , knowing
customer profiles in detail to prevent fraud . ODM models can be incorporated into SQL queries
contained in the application .
Figure 3.10 Example of Software Data Mining Oracle Data Mining

Source : www.oracle.com
 BAB 4
CONCLUSION AND RECOMmENDATIONS
4.1 Conclusion
The continued development of information technology in various fields have made our
lives so completely dependent on information technology. As well as sending data to advance
still using mail or post, now in the presence of information technology such as computers,
gadgets, and the internet can help us to do the online data transmission (e-mail) without the
limitations of time and place restrictions. Currently, the development of business in a property
insurance company continues to grow rapidly because of the many customers or clients who use
the services of the property insurance and property insurance is very useful for customers or
clients to protect their assets from a variety of problems that may come up. Of the many
customers or clients must have also increased in the company data, such as customer data or
insurance clients, financial data, the data of insurance premiums and so on. The large number of
data which would require greater storage capacity and requires an information technology that is
able to gather important information from various data and compiled into one data used for the
analysis.

Information technology mean that Data Mining. With the data mining can help
management to find and collect important information from a variety of existing data to do
analysis, such as the management of customer data or retrieve information insurance clients
(address, age, occupation, type of insurance used by the customer, the premium bill The client
and reports of incidents that often occur such as: fire, flood, etc.). From the information can
indicate the results of which will be used for the company's management decision-making
process and what strategies will be used to maintain current customers and new customer targets.

4.2 Recommendations
Here are some suggestions that can be given is :

1.Necessary care and maintenance (maintenance ) on a regular basis , especially in the sphere of
information technology data warehouse , data warehouse as a parent as a storage of important
data that will be used to do data mining process .

2. Perform grouping the data according to the type of data, so that data becomes more orderly
and easily searchable , eg customer data or employee data to place clients scattered , making it
difficult for management to seek such data .

3.Improving information technology security and restrict access rights of employees in

accordance with the job
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Sumber dari Internet : www.aca.co.id

Sumber dari Internet : www.orange.biolab.si

Sumber dari Internet : www.cs.waikato.ac.nz

Sumber dari Internet : www.r-project.org

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