Data mining algorithms are the foundation from which mining models are created. The variety of algorithms included in SQL Server 2005 allows you to perform many types of analysis. For more specific information about the algorithms and how they can be adjusted using parameters.

**Microsoft Decision Trees**

The Microsoft Decision Trees algorithm supports both classification and regression and it works well for predictive modeling. Using the algorithm, you can predict both discrete and continuous attributes.

In building a model, the algorithm examines how each input attribute in the dataset affects the result of the predicted attribute, and then it uses the input attributes with the strongest relationship to create a series of splits, called nodes. As new nodes are added to the model, a tree structure begins to form. The top node of the tree describes the breakdown of the predicted attribute over the overall population. Each additional node is created based on the distribution of states of the predicted attribute as compared to the input attributes. If an input attribute is seen to cause the predicted attribute to favor one state over another, a new node is added to the model. The model continues to grow until none of the remaining attributes create a split that provides an improved prediction over the existing node. The model seeks to find a combination of attributes and their states that creates a disproportionate distribution of states in the predicted attribute, therefore allowing you to predict the outcome of the predicted attribute.

**Microsoft Clustering**

The Microsoft Clustering algorithm uses iterative techniques to group records from a dataset into clusters containing similar characteristics. Using these clusters, you can explore the data, learning more about the relationships that exist, which may not be easy to derive logically through casual observation. Additionally, you can create predictions from the clustering model created by the algorithm. For example, consider a group of people who live in the same neighborhood, drive the same kind of car, eat the same kind of food, and buy a similar version of a product. This is a cluster of data. Another cluster may include people who go to the same restaurants, have similar salaries, and vacation twice a year outside the country. Observing how these clusters are distributed, you can better understand how the records in a dataset interact, as well as how that interaction affects the outcome of a predicted attribute.

**Microsoft Naïve Bayes**

The Microsoft Naïve Bayes algorithm quickly builds mining models that can be used for classification and prediction. It calculates probabilities for each possible state of the input attribute, given each state of the predictable attribute, which can later be used to predict an outcome of the predicted attribute based on the known input attributes. The probabilities used to generate the model are calculated and stored during the processing of the cube. The algorithm supports only discrete or discretized attributes, and it considers all input attributes to be independent. The Microsoft Naïve Bayes algorithm produces a simple mining model that can be considered a starting point in the data mining process. Because most of the calculations used in creating the model are generated during cube processing, results are returned quickly. This makes the model a good option for exploring the data and for discovering how various input attributes are distributed in the different states of the predicted attribute.

**Microsoft Time Series**

The Microsoft Time Series algorithm creates models that can be used to predict continuous variables over time from both OLAP and relational data sources. For example, you can use the Microsoft Time Series algorithm to predict sales and profits based on the historical data in a cube.

Using the algorithm, you can choose one or more variables to predict, but they must be continuous. You can have only one case series for each model. The case series identifies the location in a series, such as the date when looking at sales over a length of several months or years.

A case may contain a set of variables (for example, sales at different stores). The Microsoft Time Series algorithm can use cross-variable correlations in its predictions. For example, prior sales at one store may be useful in predicting current sales at another store.

**Microsoft Association**

The Microsoft Association algorithm is specifically designed for use in market basket analyses. The algorithm considers each attribute/value pair (such as product/bicycle) as an item. An itemset is a combination of items in a single transaction. The algorithm scans through the dataset trying to find itemsets that tend to appear in many transactions. The SUPPORT parameter defines how many transactions the itemset must appear in before it is considered significant. For example, a frequent itemset may contain {Gender=”Male”, Marital Status = “Married”, Age=”30-35″}. Each itemset has a size, which is number of items it contains. In this case, the size is 3.

Often association models work against datasets containing nested tables, such as a customer list followed by a nested purchases table. If a nested table exists in the dataset, each nested key (such as a product in the purchases table) is considered an item.

The Microsoft Association algorithm also finds rules associated with itemsets. A rule in an association model looks like A, B=>C (associated with a probability of occurring), where A, B, C are all frequent itemsets. The ‘=>’ implies that C is predicted by A and B. The probability threshold is a parameter that determines the minimum probability before a rule can be considered. The probability is also called “confidence” in data mining literature.

Association models are also useful for cross sell or collaborative filtering. For example, you can use an association model to predict items a user may want to purchase based on other items in their basket.

**Microsoft Sequence Clustering**

The Microsoft Sequence Clustering algorithm analyzes sequence-oriented data that contains discrete-valued series. Usually the sequence attribute in the series holds a set of events with a specific order (such as a click path). By analyzing the transition between states of the sequence, the algorithm can predict future states in related sequences.

The Microsoft Sequence Clustering algorithm is a hybrid of sequence and clustering algorithms. The algorithm groups multiple cases with sequence attributes into segments based on similarities of these sequences. A typical usage scenario for this algorithm is Web customer analysis for a portal site. A portal Web site has a set of affiliated domains such as News, Weather, Money, Mail, and Sport. Each Web customer is associated with a sequence of Web clicks on these domains. The Microsoft Sequence Clustering algorithm can group these Web customers into more-or-less homogenous groups based on their navigations patterns. These groups can then be visualized, providing a detailed understanding of how customers are using the site.

**Microsoft Neural Network**

In Microsoft SQL Server 2005 Analysis Services, the Microsoft Neural Network algorithm creates classification and regression mining models by constructing a multilayer perceptron network of neurons. Similar to the Microsoft Decision Trees algorithm provider, given each state of the predictable attribute, the algorithm calculates probabilities for each possible state of the input attribute. The algorithm provider processes the entire set of cases , iteratively comparing the predicted classification of the cases with the known actual classification of the cases. The errors from the initial classification of the first iteration of the entire set of cases is fed back into the network, and used to modify the network’s performance for the next iteration, and so on. You can later use these probabilities to predict an outcome of the predicted attribute, based on the input attributes. One of the primary differences between this algorithm and the Microsoft Decision Trees algorithm, however, is that its learning process is to optimize network parameters toward minimizing the error while the Microsoft Decision Trees algorithm splits rules in order to maximize information gain. The algorithm supports the prediction of both discrete and continuous attributes.

**Microsoft Linear Regression**

The Microsoft Linear Regression algorithm is a particular configuration of the Microsoft Decision Trees algorithm, obtained by disabling splits (the whole regression formula is built in a single root node). The algorithm supports the prediction of continuous attributes.

**Microsoft Logistic Regression**

The Microsoft Logistic Regression algorithm is a particular configuration of the Microsoft Neural Network algorithm, obtained by eliminating the hidden layer. The algorithm supports the prediction of both discrete and continuous attributes.

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