To a certain extent the problem is using a discrete function to approximate a continuous function. Overall team quality is continuous, while lumping them into groups "winning record" "losing record" maps them onto a discrete function with only two possible values.
Another interesting shortcoming in your system is that a team could have no wins over anyone with a winning record, yet have a winning record itself. We know this happens from looking at bowl teams. Is a win over that team really worth more than a win over some other team that might have a losing record solely as a function of the teams they played, but which actually does have some wins over teams with winning records?
Another modification you might consider would be to, before processing the teams at all, drop all wins over FCS teams. Next you could drop all wins over teams with no wins at all (or wins only over FCS teams). Beating winless teams and FCS teams should not count for anything, and not towards pushing a team into the "winning team" category.
..and yes, I know that teams in the top half would also be affected. That doesn't bother me. A win over 3-5 Texas, or 3-5 Monroe should be worth more than a win over 1-7 Kent, for example. The value of wins over mediocre teams should be a lot less than the wins over winning teams, though, so even though the teams in the top half might move a little, they wouldn't move at all. Thus, the more significant effect would be a more reasonable sorting of the bottom half.
Also, yes, I know that my proposed modification will move Ohio down substantially since most of its wins are over bad teams, while some of the teams that are ranked below them may have beaten some teams with "near winning" records.
Yet another possible change might be to do the intial calculation exactly as you have, but then do a second iteration, and add "bonus points" to teams with wins over teams in your top 10, lesser bonus points to teams in your "top 30", and still less bonus points over teams in your "top 50". That might improve sorting in your top half by giving teams some extra credit for especially good wins.
BTW, system simulation and stochastic process were some of my favorite courses, long, long ago, when I was studying operations research.
Last Edited: 11/4/2014 12:23:56 PM by L.C.