November 10, 2017 ☼ RapidMiner ☼ AI Machine Learning

This is a great video presentation on Fraud Analytics use case with RapidMiner. See my notes below.

##Some key concepts

• More complex model, the lower the training error but higher test error.
• Simple models are better, try explaining them to children.
• Data Scientists understand the technical aspect, need to communicate results with analysts.
• Sell results to businesses. Tie $ to the results.
• Speak same language with business. Map performance metrics to business related figures.
• AUC and recall doesn’t necessarily mean $ to the business, show how.
• A/B testing method widely used in Marketing. Also consider a “do nothing” model and compare with implementing data science solution.
• Don’t fear sharing best practices and ideas with similar businesses.
• Fraud model follows traditional validation method. 80% Training and 20% as Holdout.
• Both training/holdout sets taken across same time period.
• Handy trick, use sum of transactions as example weights. (this is cool)
• Apply $ value to your true/false positive/negatives.
• Compare with Default model (no model).
• Generate a money plot!

##Some questions

• How does this relate to regression?
• If a simple model not good enough, how do you sell a complex one like Deep Learning?
• Is it better to have the Data Science team be embedded in the Business Unit or as a separate team?
• How do you try to explain the uncertainty of prediction intervals to business stakeholders?
• How do you account for seasonal drift?
• The model will drift overtime, should the model be updated or retrained over time?
• Do you build a model to optimize business results or is it a byproduct of the prediction?