Although the practices that are about to be discussed are associated with KDD and data mining, they are not restricted to them, and I believe that the vast majority can be easily extrapolated to other contexts.
Since its origin, humankind has been taking advantage (and sometimes being misguided) from its strong pattern recognition capabilities. We humans can now gather and store far more data than our natural abilities are capable of making sense of. We also developed tools and methods to deal with this data overload. KDD is one of these tools—it's an interactive, iterative, stage-wise approach that's used to make sense out of big and unstructured databases.