Simulating Success

There is a way to simulate apparantly incalculable phenomena such as predicting movements and share prices in the stockmarket or predicting weather changes. Let's say you roll a dice, how do you know which number you will get on a given roll? Using the Monte Carlo analysis it is possible to approximate a definitive outcome. The Monte Carlo analysis or method rely on repeated random sampling to come up with a definite result.It uses a combination of probability andf statistics. Why is it important, is it because it allows us to simulate a definite outcome? No. Its important becasue it reminds us that computational algorithm is not reality but an approximation of reality.

Let me qoute Pablo Picasso to make sense of it all who said "If I know what I am going to do, what's the good in doing it?"

If most people are aware of the Monte Carlo analysis why is it then that 20% of the world's population holds 80% of the total wealth? Also why is that 20% of effort produces 80% of results while 80% of effort only produces 20% of results? Well we have Vilfredo Pareto to blame for that. However the Pareto principle can not be applied to everything but anybody who wants to plan their time optimally should know that roughly 20% of the time spent in a task leads to 80% of the results. That reminds me Louis E. Boone once said "I am definitely going to take a course in time management... just as soon as I can work it into my schedule."

Having said that the Pareto principle is not always right as observed by Chris Anderson former editor in chief of Wired. In 2004 he claimed that nearly everything that is offered for sale on the internet is actually sold as written on his blog. This is best illustrated using a demand curved called long tail model. In the model the best performaners account for 20% of the market, then the curve gently levels out which occuppies a much wider comprising of the less popular products but in todal bigger in number. The things is it still looks like the pareto principle applieshowever the long tail achieves a much higher total turnover than the best sellers.

If Chris Anderson is right, then don't worry if you don't end up with a blockbuster product, you might still end up with higher revenue. And if he is wrong, then you realize that Microsoft, Google and other companies like them are indeed one in a billion.