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The important processes that have to be clearly delineated for Data Mining, Analysis and Modelling are:

Data model: what data will be available and how will it flow?
Data gathering: how will data be gathered both in physical and technological terms?
Data gathered: what data will be gathered?
Data types: what types of data will be gathered?
Data formatting: how will data be held?
Data warehousing: where will data be held?
Data mining: how will we retrieve data from the warehouse?
Information modelling: how will we create models and what of?
Information access: how will we access the data models and reports?
Presentation & reporting: on what will we report?

Most companies want to know essential information about customers at every point of contact, for example:

Lifetime value
X sell and upgrade potential
Acquisition cost
Channel preferences
Loyalty/retention
Purchase behaviour patterns

Much of the data that they have will have different frequencies of change, refreshment or occurrence. It will be kept for different periods. In some cases, aggregated data may be kept rather than source data. All of these factors effect the data modelling exercise and the eventual modelling software requirements.

Turning the data into useful information requires:

Identifying the issue(s)
Assembling the data set(s)
Building models
Verify models
Interpretation of the results
Automation of the delivery

Thereafter, modelling tools and techniques have to be used. These can be divided into two groups: theory driven and data driven.

Theory driven modelling (hypothesis testing) attempts to substantiate or disprove preconceived ideas. Theory driven modelling tools require the user to specify most of the model based on prior knowledge and then tests to see if the model is valid.

Data driven modelling tools automatically create the model based on patterns they find in the data. This also needs to be tested before it can be accepted as valid.

Modelling is an iterative process with the final model usually being a combination of prior knowledge and newly discovered information. The engine(s) tools and techniques include:

Statistical techniques
Data driven tools
Correlation
Cluster analysis
t-tests
Factor analysis
Analysis of Variance
CHAID (Chi-square Automatic Interaction Detector) decision trees
Linear regression
Visualisation tools
Logistic regression
Neural networks
Discriminant analysis

Customer Advisory Boards are a great source of information about your market and your business. Their advice is more valuable than any management consultant’s. They provide real world counsel on what you are doing right, what you are doing wrong, and most important -how to stay competitive. After all, they’re the customer. They’re the one’s who buy your stuff. Here’s how to use your Customer Advisory Board for best results.

1. Make it win-win.
As much as they might like to, your customers are probably too busy to be on your board as a favor. Let them know, if they haven’t figured it out already, that participating on your board influences your organization to provide better product and service to theirs.

2. Choose the right members for the right reasons.
Select your board members for qualities and values they bring. Benefit from their insight, perceptions, motivations, and ability to communicate – perhaps even their contrarian view. Avoid figureheads picked for their visibility or high positions – they are likely to skip meetings, and when they show they’ll have little to contribute.

3. Prepare your members.
Apprise members ahead of time of agenda items and provide detailed backgrounders. Prompt their thinking with questions for their consideration. When germane, ask selected advisors to prepare briefings.

4. Don’t sell to the group.
Use your advisory board for their advice. Customers will see through transparent plans to generate more sales. Increased sales will happen anyway – don’t prompt for them.

5. Your board members are special. Treat them that way.
Provide them with quality transportation, hotels, meals, refreshments, and meeting space. Make them feel highly appreciated without the sense you are wasting company money. Have your CEO or outside owners participate whenever appropriate. Acknowledge them publicly and often, and especially in print.

6. Reward their participation.
They are giving you their time and knowledge gained from experience. What are you giving them? Dinner and theatre or sports tickets, spouse travel, club memberships, small gifts, and product or service discounts are all appropriate.

7. Fewer meetings the better.
Keep the meetings to two or three per year. Make each meeting count with a full agenda of important issues. Have additional meetings only if you are in a crisis.

8. Use information technology.
Members cannot make every board meeting. Use videoconferencing for virtual meetings. Teleconferencing is effective for briefer, interim meetings. Use web-conferencing tools like Webex or Placeware.

9. Run top-notch meetings.
Appoint an effective leader, begin and end on schedule, keep to a strong agenda, review past actions and commitments, encourage total participation, keep communications open, log action items, avoid side conversations, summarize meeting results.

10. Act on their advice.
Your advisory board will give you their best only when you act on their recommendations. That’s why you got them in the first place.