CHAID Decision Tree: Methodological Frame and Application

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Technological advancement across human activities has brought about accelerated generation of huge amounts of data. Consequently, researchers are faced with the problem how to determine adequate ways of turning the available data mass into useful knowledge. Data analysis adapted to these changes when data mining was developed as an approach to data analysis from different perspectives which reveals significant hidden regularities. This paper presents conceptual characteristics of decision tree, an important data mining method which is, due to its explorative nature, exceptionally suitable for detection of data structure when analysing various problem situations. The empirical section of the paper demonstrates applicative characteristics of this method using CHAID algorithm in leadership studies: an interdependence of selected personal characteristics and the manager’s leadership style has been investigated. The aim of the paper is to develop a classification model for identification of the dominant leadership style. The study was conducted on the sample of 417 managers of privately owned small-sized enterprises in Serbia, using a specially designed questionnaire. The classification model identified the set of six statistically significant personal characteristics as predictors of dominant leadership style.

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