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The Jensen Formula: How to make your strategy inevitable

When you watch a typical CEO keynote, you usually feel like you’re being sold to. You have your guards up and you are constantly looking for the holes in their argument.

When you watch Jensen Huang, CEO of Nvidia, you don’t feel sold to. You feel informed. He walks you through a series of facts that seem undeniable.

How exactly does he do this?

Yesterday, I wrote about how he strips away the adjectives and builds his argument with nouns and verbs.

But having the right materials is only half the job.
You still need the blueprint.

Most leaders have the blueprint upside down.
They start with themselves.

They open the deck with: “Our Strategic Initiative 2026.”
Then they list their goals, their features, and their timeline.
Basically, they are showing you the pill before you even know you’re sick.

Jensen Huang builds it the other way around. He doesn’t start with Nvidia. He starts with the world. Which means, he doesn’t ask you to agree with his strategy. He forces you to agree with physics first. And once you agree with the physics, his strategy becomes the only logical conclusion.

It’s a 3-step formula. If you watch closely, he uses it in almost every major keynote.

1. The New Reality (the “broken” assumption)

The amateur says: “We are launching a new AI processor.”
Huang says: “General-purpose computing has run out of steam. Moore’s Law is dead.”

He identifies an External Shift (physics/market limits) that has fundamentally broken an Old Assumption (that CPUs will keep getting faster and cheaper). Put differently, he isn’t trying to sell an opinion. He is stating a fact that you cannot argue with.

2. The Necessity (the gap)

Now that the old way is dead, what does the world demand?

He says: “To keep scaling intelligence without bankrupting the planet, we need a new way to calculate. We need accelerated computing.”

He defines the New Capability required to survive in the New Reality.
(Note that he still hasn’t mentioned his product. He is defining the hole in the market so clearly that you are starting to beg for the plug.)

3. The Commitment (the only way out)

Only now, after he has broken your old assumption and defined the necessary fix, does he talk about himself.

He says: “That is why we built Blackwell.”

By the time he reveals the strategy, it doesn’t feel like a pitch. It feels like relief.
It feels like the only rational response to the reality he just described.

The pitch says: “Look at my great idea.”
The formula says: “Look at this broken world. Here is the only way to fix it.”

Let’s revisit the formula:

1. New Reality: [External Shift] has fundamentally broken [Old Assumption].
2. Necessity: This requires [New Capability] to function.
3. Commitment: [Our Strategy] is the only way to deliver [New Capability].

If you mess up step 1, step 3 is arrogant.
If you nail step 1, step 3 is inevitable.

Now, try it on your own strategy.

Don’t start with “We are implementing a Hybrid Work policy.” (That’s Step 3).
Start with: “We lost our last three
Senior Engineer candidates to
companies that offer flexibility” (Step 1).
Then: “We cannot build a world-class product with second-tier talent.” (Step 2).
Therefore: “We are implementing a
Hybrid Work policy.” (Step 3).

To put it in a nutshell: Don’t persuade people that your strategy is “good.” Prove that it is necessary.

Keep lighting the path,
Michael

PS: Read the full case study of how Jensen Huang communicates in my newest issue. If you use this link, you can access it free for a month, including the action guide, and cancel anytime.

Are you a visionary leader?

We spend too much time looking for “Visionary” leaders.

The word implies that the job of a leader is to hallucinate a future and then charisma-roll the organization into chasing it. Like if you can’t see around corners, you aren’t qualified to lead?

There is a lot of winner’s bias in telling the heroic stories of visionary leaders. The worst part is that “be visionary” is simply not repeatable and therefore, useless as a leadership lesson.

I’m much more interested in the lessons that are repeatable. Nvidia’s breathtaking 2016 pivot provides such a lesson. It suggests a different, much more accessible model:

Your job isn’t to be a prophet.
Your job is to be an architect.

An architect doesn’t “predict” that a building will stand. They understand the laws of physics (gravity, tension, compression, etc.) and they design a structure that aligns with those laws.

That’s exactly what Nvidia’s CEO Jensen Huang did.

Maybe he saw AI earlier than most of us. But their rise also had a much more grounded reason: It was very well architected. And phenomenally well communicated.

My newest essay on “What the Best Leaders Say” takes a very precise look at how exactly Huang did this.

If you ever needed to orient your team under uncertainty but didn’t have a crystal ball, this one is for you. What Huang did is very much repeatable.

It drops tomorrow morning.

Keep lighting the path,
Michael

PS: If you use this link, you’ll get access to the essay series free for a month and you can cancel anytime.

The weatherman doesn’t get wet

The weatherman predicts rain, but he doesn’t get wet if he’s wrong.

Most leaders are weathermen. They forecast bold futures and “strategic pillars,” but if the strategy fails, the team gets wet, not them.

A costly signal is what happens when you throw away your umbrella and walk outside.

It’s the act of tying your personal comfort, your bonus, or your reputation to the bet you are making with your strategy.

It proves you’re willing to go down this path even if the forecast is wrong.

Who is your team more likely to follow?

Keep lighting the path,
Michael

Why the “reasonable” exceptions are the worst


Does this loop feel familiar?
The killer word is “reasonable.” It’s always a reasonable exception, isn’t it?

The trap is the “good intentions”. Of course it “makes sense”. Of course there are good reasons. Many, in fact.

But focus means saying no to the 1000 good reasons in favor of the 1 real reason. That’s how progress happens.

The problem is that the trap isn’t easy to spot because it sounds so reasonable. I’ve collected a few examples I’ve heard last year:

“We’re moving to product-led growth” 
⤷ Except for enterprise sales

The CEO announces a pivot to self-service, freemium, product-led growth. Then adds: “Obviously, this doesn’t apply to enterprise deals over €100K.”

Within three months, the enterprise team consumes 80% of product development building custom features, the self-service experience remains broken, and the company is neither product-led nor sales-led.

“We’re focused on 3 strategic priorities”
⤷ Plus the CEO’s new idea

Leadership emerges from an offsite with clarity: DACH expansion, mobile launch, Q3 profitability.

Week 2: The CEO returns from a conference, excited about AI. She requests “just a small tiger team.”

By month 2, the AI project has pulled the CTO, two senior engineers, and half the roadmap conversation. The three priorities are now starved of attention.

“No more custom development”
⤷ Except when sales needs to close

The CTO declares custom development is killing scalability; prospects buy the platform as-is or they’re not the right fit.

Two weeks later, a €2 million deal requires a custom reporting module. Sales argues “this is strategic revenue.” The CTO caves.

Within six months, the product has 11 “strategic exceptions” and the standardized platform never materializes.

“We’re sunsetting legacy products”
⤷ Except for existing customers

The VP announces the company will no longer support three legacy products. Everything goes through the unified platform.

But Customer Success raises concerns about top accounts not being ready to migrate, so leadership grants “limited exceptions.”

Within a year, 60% of customers remain on legacy with extended support, and engineering maintains two completely separate codebases.

I told you. It’s always “reasonable”.
And it always reinforces organizational inertia.

It always costs time, money, and motivation.

And it always distracts from the new path.

True or not?

What’s your experience with “reasonable exceptions”?
How do you deal with them? Hit reply!

Keep lighting the path,
Michael

PS: The newest essay on “What the Best Leaders Say” looks at ways to escape the inertia trap.

The saddest day in any organization

The “scientific” proof of Blue Monday was just a PR stunt to get people to book their holidays early, but I’m sure that for many of you the feeling is still close to the truth regarding your organization.

The enthusiasm of a fresh start after the holidays is gone.

You’ve already made the first exception to your “rigorous” focus this year, because “it’s a loyal customer and we need to build this feature for them” or “this is an opportunity we can’t miss”. (And each one felt reasonable. Because it always is.)

The first “problems” were thrown your way. Some team members complained that we’ve always done it “that way”. And around today, most of you know what organizational inertia feels like.

You have – again – realized that changing the organization is harder than writing the strategy.

The “Saddest Day” for any organization is effectively the day the Status Quo wins.

→ The old priorities pull everything back into place.
→ The old language keeps winning.
→ The old defaults take over the decisions.

If that pattern feels familiar, you’re not alone. I’ve seen it in companies of all sizes across all industries.

When you look at what the best leaders do now, one thing’s pretty clear to me: You don’t need a new strategy, more training, and definitely not more announcements.

You need a very clear signal that the Status Quo is truly done. Words that make it feel harder to do the old thing than to do the new thing.

The newest premium essay on “What the Best Leaders Say” is about finding those words. It’s called “Escaping the Inertia Trap”.


When you subscribe with this link, you’ll get this issue and the next one free, with full access to the whole archive, including audio versions and action guides. It’s risk free. You can unsubscribe anytime.

So, will you escape the inertia trap this year?

Keep lighting the path,
Michael

How did we end up with seven top priorities again?

Some of you will be heading to your annual strategy retreat very soon. How wrong am I to assume that it will feel like a scene from Groundhog Day?

The same unfocused discussions as every year.
The same ambitious announcements.
The same hangover a few weeks later when everything’s back to before. As if the retreat was just some faded dream we had last night.

Suddenly, the new “focus” is the same old fuzzy direction (or five) as before, because “did you see what the newest Gemini model can do, we should really leverage this in our strategy.”

While the new “priority” is actually seven and it can change any day when a new customer comes along with an “interesting project”.

But the worst part is this: We look away. We treat it as normal.

Maybe because we think that’s what it is. It’s just how things are. Not much we can do about it.

And yet, we must. Because this endless cycle of scattered focus and changing direction has a price tag.

→ It shows up as slower delivery, higher burn, missed opportunities, and rework that should never have been necessary.

→ It shows up as teams hedging their bets because they don’t trust that today’s priority will still be the priority next week.

→ It shows up as leaders approving work that contradicts the strategy because saying no feels harder than absorbing the waste.

And the personal cost is just as high.

People burn out from useless work.

→ From pouring hours into tasks that will be undone in the next reshuffle.

→ From making decisions that get reversed because someone higher up changed the story overnight.

→ From caring about results that never materialize because the strategy keeps wobbling.

You lose morale.
You lose talent.
You lose speed.
You lose money.

Does this feel familiar? Maybe at some point, you even stopped fighting it.

You approved work you know does not quite fit.
You told yourself this is temporary.
You noticed the priorities multiplying.

But instead of naming it, you adapted.

The moment you recognize this matters more than the agenda for the next retreat. It’s often the first sign that orientation is missing.

I’ll leave you with one simple question for the weekend. Next week, when that moment shows up again, what will you do differently?

Keep lighting the path,
Michael

Isn’t this obvious?

This might disappoint some of you: The strongest strategy in 2026 will sound boring in the boardroom and obvious in the field.

Yup. You’ve read that right. Boring and obvious. Not grand or clever.

Why? Because the only measure of a strategy is whether it shapes the choices that actually have to be made in the field. Not how clever it sounds and how impressive the slide deck looks. Simply whether it leads to action.

Now, guess when people are most likely to act? Exactly! When the action is obvious.

When people in the field say “yes, of course” after hearing your strategy, you’ve nailed it. If you’ve ever seen it in action, you know that an “of course effect” is so much stronger than any “wow effect”.

The only problem is that “of course” sounds boring. Which is why people avoid it.

Which, in turn, is why it might be your biggest advantage to embrace it.

Leaders who light the path don’t try to impress. They choose words that make the path impossible to miss.

Even if that sounds boring and obvious.

What’s your take? Does a strategy need to sound “exciting”?

Keep lighting the path,
Michael

Can you take a quick look?

An exec asking a team lead a casual question in the hallway: “Can you take a quick look?”


And just like that, focus is gone.
It looks like an innocent question, responsible even … you’re “just” exploring options … but here’s what really happens.

It comes up in the next team meeting (“The boss wants to know”).
It’s not exactly a priority, just something “to be aware of”.

Someone volunteers to dig a little deeper, just to be helpful.

Someone else adds a related idea that might also be worth exploring.

A short list appears.
People want to be supportive, so they say yes.

By the end of the week, the team is no longer working on one thing. They’re working on five.

And it all started with a small phrase:
“Can you take a quick look?”

That’s how focus breaks. Not because anyone lacked discipline (in fact, everyone is highly disciplined in the example), but because everyday language creates ambiguity.

Remember that in an organization, every word from someone with authority has executive weight.

Your team takes your questions seriously. So, even a well-meant inquiry can create loads of work. And dilute focus as a consequence.

→ You’ll need corrections in place to avoid this.

One of the most effective ways is to have a guiding sentence for the year. A client of mine last year chose this one:

“Every decision for new work begins with what we will stop to make space for the work.”

The trick is to give your team permission to use this against you. Whenever you come up with an “innocent” idea, they can throw this guiding sentence at you.

If your idea doesn’t hold up, it’s dismissed immediately.

Do you have a guiding sentence for your organization? It will boost your impact if you invest the time to find it. The newest issue of What the Best Leaders Say shows you how they do it.

Keep lighting the path,
Michael

My beef with the North Star

It’s not that it’s a bad metaphor. It’s that it has lulled leaders into a completely wrong picture of what their job is.

The whole “North Star” thing makes it sound like clarity is about pointing somewhere far away. You put a shiny dot up in the sky, tell everyone that’s where we’re going, ideally using fancy words, and then sit back, satisfied that you’ve done your part.

But here’s the problem:
People don’t live up there.
They live down here.

On the ground, with obstacles in their way, fog all around, and a thousand confusing paths splitting off in every direction.

From down here, the North Star doesn’t tell you which turn to take. It doesn’t show you where the next step is. It doesn’t even guarantee you’re still heading in the right direction when the terrain gets messy.

And yet, I keep hearing leaders patting themselves on the back because they “set the North Star.”

As if that’s enough. As if that alone will get anyone moving.

It won’t.

Because people can’t follow stars. They need a little light on the path ahead. Something they can actually see. Something that shows them the next few meters clearly enough to walk with confidence.

That’s my beef with the North Star. It’s comforting. It’s poetic. But it’s too fancy to be useful.

If you want people to walk with you, stop pointing at the sky and start lighting the ground in front of them.

Keep lighting the path,
Michael

PS: This is also why A stands for actionable in the PATH framework.

The most unexpected 40th anniversary in business

Believe it or not, the last Blockbuster store celebrates their 40th anniversary. I think that most people miss a crucial point about their decline.

And it’s all about meaning what you say.

On paper, there’s no way they should have lost.

They had a dominant market position and used what sounded like a brilliant core credo:

→ “Make this a Blockbuster Night!”

It scores incredibly high on all four PATH principles: plain and simple, actionable, transformative, and heartfelt.

And for many years, a typical Friday night indeed meant going to a Blockbuster store and setting yourself up for a great movie night with your family or friends.

Until Netflix made a better promise: Why not get your movies by mail and start your movie night directly from home?

Everyone knows that Blockbuster dismissed it and was doomed as a result.

But most people ignore that this shouldn’t have happened. It’s almost unbelievable that Blockbuster didn’t see it coming.

Because if you look at their credo, DVD by mail is clearly a more convenient way to “make this a Blockbuster night”.

Let’s put it that way: DVD by mail is just another LANE on the same strategic PATH.

You can even see how streaming would have fitted neatly into the promise. Also just another lane.

BUT.

The above credo wasn’t their ACTUAL credo.
It was just a MARKETING slogan.

Their actual credo was …
well …

… non-existent.

It was a scattered company with many competing interests and just as many competing voices that couldn’t agree on how to face the changing market conditions.

Their CEO wanted to a push for online.
Investors around Carl Icahn were vocally against it.
Marketing was trying to please customers.
And this is just the tip of the iceberg.

But when leadership can’t agree on a path, what is the team supposed to do?

More fundamentally, how can you move forward when there’s no agreement on which direction actually is forward?

That is the actual lesson here. Not short sightedness but lack of alignment doomed them.

And it’s why in the book, I’ve dedicated a whole chapter to that first step: You need to make a choice. Someone needs to be brave enough to make the call, define the path, own that choice, and align the team.

This is the actual act of lighting the path. It’s not about predicting the future or persuading harder. It’s about creating clarity so strong that everyone knows where forward is.

That’s not easy, but it’s essential.

What’s your take on Blockbuster’s decline?

Keep lighting the path,
Michael

PS: If you enjoy these real life cases and would like me to dissect one through the PATH lens, hit reply and let me know me which case fascinates you.

Spread the Word

Picture of Dr. Michael Gerharz

Dr. Michael Gerharz