“If I find 10,000 ways something won’t work, I haven’t failed. I am not discouraged, because every wrong attempt discarded is another step forward.”
- Thomas Edison
Failing 10,000 times is a physical and mental undertaking that far exceeds most people’s endurance. Today, however, a new breed of innovators are outsourcing failure to computer simulations and it’s changing business and political strategy.
Barack Obama defeated Mitt Romney, in part, with Big Data.
In corporate life, Mitt Romney was known for his acumen, strong work ethic and keen eye for talent. He carried these practices over to his political career and his campaign team was similarly bright and indefatigable They analyzed past trends, developed a theory of the case and executed their strategy efficiently. They had only one chance to get it right.
President Barack Obama had a different approach. He created an entire division of young, unkempt, over-caffeinated data junkies with little experience in business or politics. They had no set theory of the case, but instead ran 62,000 simulations per night and continuously updated their approach.
The result is now clear to just about everyone on the planet. The smartest guys in the room were no match for terabytes of data and smart algorithms. There is no more “theory of the case,” but thousands of them, being run constantly. The point isn’t to be right, but to be less wrong over time.
As Ria Persad, President of StatWeather – a firm that has managed to double the accuracy of weather forecasts, puts it, “There is a difference between a deterministic and a probabilistic forecast. We don’t actually predict one weather outcome. We run thousands of possibilities, present the most probable scenario and the risk associated with it.”
In effect, we’re increasingly moving towards a simulation economy, where strategic analysis gives way to reconstructing phenomena from real world data, testing hypotheses and learning.
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