Virtuous cycle

Bartlomiej Owczarek weblog

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Thriving in Pareto world

A quick note on an interesting article of John Hagel, comparing Gaussian and Paretian world views.

Gaussian views seeks for “normal” distribution of things in the world around us, while Pareto focuses on power law distribution, with disproportionate influence of a limited number of events/objects (think: earthquakes, accumulation of wealth, etc.)

Gaussian situation is said to occur when there is little interaction between particular observations. Interactions easily create a positive feedback loop, and some objects obtain advantage which is self-reinforcing.

World is getting more networked and interactions are increasing, and Pareto mindset is becoming more important.

Thus, new tools are required to handle this reality. Some sources of them are hinted – earthquake research, complexity science. It would be interesting to define a toolkit immediately applicable in business, though.