Jensen Huang Is Thinking With Scenarios
Evolving from a pure technologist to a strategic futurist thinker
Last year I had the honor of being invited to sit in on the big Stripe, Inc. conference in San Francisco. During that conference I sat in on a wonderful presentation by Jensen Huang, CEO of Nvidia. He was on the podium for over an hour with the Q&A by one of the founders of Stripe. The conference was wonderful. I learned a lot about how the worlds of finance, software and communications were combining to remake a lot of what I learned about financial market functions in business school decades ago. (Of course, the 2008 financial debacle had me running to all manner of books and podcasts which I continue to search out). Jensen’s presentation that day was a backgrounder on how he and his team worked against the odds and created their fantastic chips that are now powering AI, even from their birth in the video game industry (see Wired Magazine on this). I came away thinking this guy is the greatest technology developer of this age. However, recently here is some reporting from the New York Times on Jensen’s thinking (https://www.nytimes.com/2025/05/21/business/nvidia-china-washington-chip-controls-failure.html?searchResultPosition=2 ):
Jensen Huang, the chipmaker’s top executive, said the attempt to cut off the flow of advanced A.I. chips spurred Chinese companies to “accelerate their development.”
Lawmakers in Washington have worked for years to limit China’s access to the cutting-edge computer chips needed for advanced artificial intelligence, particularly those made by Nvidia, America’s leading chipmaker.
But according to Nvidia’s chief executive, Jensen Huang, those regulations, driven by economic and security concerns, have only made Chinese tech companies stronger.
The export controls on chips forced Nvidia to forfeit its dominant position in China while domestic companies like Huawei, the telecommunications giant, filled the gap, Mr. Huang said at a news conference in Taipei, Taiwan’s capital, on Wednesday.
This is not Jensen talking like a chip engineer, but as person with a global and deeper view of what is going on in the markets for his products. I want to “read between the lines,” and expand on what I think Jensen might be thinking as a futurist and scenario thinker. He will need to do a lot more of this going forward.
As a scenario thinker, Jensen is doing something that people in the oil and gas industries did decades ago; they are looking beyond the pure supply side of their businesses into the broader world which impacts and shapes demand for their products. In the 1970s Royal Dutch Shell, as I learned while working with Peter Schwartz and Global Business Network, realized that the future of the oil and gas business was not about how much was in the ground that they could pump out. A much wider range of factors in the political, economic, social, technological and ecological spheres would combine to shape the future. This led to the creating of corporate scenario analysis (see, “The Art of the Long View,” by Peter Schwartz for a lot of the details). So, Jensen; Welcome to the world of scenario analysis!
Nvidia and Jensen now fully realize that the future of their product’s global success will not be solely determined by the technological prowess in creating chips that are the most powerful and wonderful. And, the simple strategy of just keeping them all for the people we like and agree with might doom his company. The dynamic world which integrates politics, economics, cultural and social shifts, climate change and other big trends, together with technology development from other fields (biology, materials, robotics, etc.) cannot be ignored. The creativity and genius in people around the world will play in that mix, raising new uncertainties and risks. Managing through all of that is what scenarios analysis was created for, as a long-term learning-oriented tool to help decisionmakers.
Jensen’s Scenario Matrix
I have not interviewed Jensen or any of the folks at Nvidia, what I am presenting below are not their actual scenarios from inside the company. These are ones that I imagine might be relevant and useful.
A scenario matrix (or space or map) at a high level is created by determining (with thought and analysis) two really important and highly uncertain driving forces of change that impact an issue (key decision) at hand. Here are two key drivers I thought about on the chart below.
In this case the issue at hand is the long-term market for Nvidia’s chips. This is reflected in Nvidia’s stock price, which swings by billions of dollars in market value, and I imagine is a key concern for Jensen.
What I am suggesting is that there are big uncertainties on both the supply and demand side. The supply side is how the nexus of chips and the related software, data systems and programming will evolve. Limitations clearly exist. On the demand side, the major uncertainty is about evolution of demand (where, what pace, who). Of course, with more time and research, we could dig deeper in to all the factors affecting these two key drivers (real scenario work involves this over several months with a team). Research and analysis on political factors, technology development, economic shifts over time, variations in cultural values that impact AI use, and other factors like this are key drivers that would comprise elements of a long-term learning agenda about the future of demand. Research here would also assist in identifying early indicators. (See: artofquantumplanning.com for details this process.) But we can use those two uncertain drivers to form the high-level scenario matrix below.
You can see my very high-level summaries of these spaces. In rigorous scenario development, full narratives would be created using the full set of scenario drivers. But you can see these are very different future possibilities when thinking about the key important drivers. They would be starting points for more detailed work with a time frame (perhaps 3 years for the fast-changing tech world).
Returning to Jensen’s comments in the NYTimes, I think we can see that he is very concerned about dropping out of the NE quadrant into the SE quadrant. Nvidia’s stock price losses the growth story that is driving its stock price in the SE quadrant. I will build on that concern by showing three possible pathways through the matrix that Jensen may be (or should be) thinking about.
Scenario Thinking, Pathways and Strategy
My Path 1 represents the shocking realization that the dreamed-of world of continuous technological innovation driving expansive market development for AI and other computer system related products might be pushed off the rails by politics and social concerns! The NE quadrant is where most people thought the present and foreseeable future was with the launch of OpenAI in 2023. In the minds of the tech world moving out of this quadrant is throwing sand in the gears of progress by people who don’t understand the marvelous things they are offering the world. Jensen is recognizing that a lot of sand might be thrown in the gears from a lot of different directions (or factors, like politics, financial markets, and economic shifts) and by a lot of people. The tech community which is heavily investing in data centers, researchers and the like want to tell a story in which the U.S and the world avoids leaving the NE and reverses any policies leading to Path 1. I read Jensen’s comments covered in the NYTimes as, “We can’t go down Path 1!”
My Path 2 would be an absolute nightmare for Jensen. If people like Gary Marcus (and Apple Computer’s recent paper of LLM limitations) are right, and there will be even more limitations on what these systems can do (versus, let’s admit it, some hype), then Nvidia could be pushed into the SW quadrant along with the AI industry. It appears easy to envision slipping from the SE quadrant to the SW. I can think of a range of factors from some of our key drivers like: cultural adaption and resistance issues, economic disruptions (like from the banking and capital markets sectors) political interference and more, that could upset things and slow the pace of AI use (especially on a global basis). Good scenario analysis with a learning agenda is where this kind of work can be done to alert a company to early indicators and help develop risk management strategies.
This raises the question of what Jensen and others in the industry should do? How can they either pull the world back into the NE quadrant, or at least get to the NW quadrant? Path 3, the NW quadrant, where there is still significant enough demand for profitable growth. (The SW scenario quadrant is completely avoided by policies in Path 3.) In this world some really big silos keep chip sales and AI market development advancing, if at a less than booming pace, but still with year-on-year growth (think the U.S. and Europe composing one big market with complementary regulations and standards). A positive story can be told in the NW quadrant to keep Nvidia’s stock price from collapsing. Other nations might get pulled into the U.S. and European orbit based on politics and access to financial capital and spur long-term growth.
Here is the problem I see in getting back to and remaining in the NE or NW quadrants: they both have a wealth-sharing problem that Donald Trump and a lot of Americans are worried about. The promise of tech growth and global markets and prosperity has left too many people out of the gains. It is widely seen as a bait and switch job that only benefits an elite few. The rise of nationalist politics, in the U.S. and elsewhere, is driven by those concerns. The trade policies aimed at China are a prime example of this concern impacting policy and shaping markets.
There might be a way to get to the NW or NE quadrants if the tech community steps up and politically supports a broader sharing of the benefits. If AI is going to take a lot of people’s jobs away, how will they be taken care of? What will be the basis of the new economy, jobs and lifestyles? My scenario matrix for Jensen leaves me is with the following questions for him:
1. How do you, with all your wealth and power, want to step into the political sphere and express concerns (values) about the impact that technology will have in shaping our economies and our lives? There are tax policies here.
2. Do you plan on hearing, understanding and taking effective actions on addressing concerns about how your technology will be used? There are cultural adoption issues here.
3. What key concerns do you have beyond Nvidia’s stock price?
4. What is the long-term learning and risk management process for Nvidia now that major non-technical risks are facing the company?
I am so much enjoying reading John Chamber's book, "Connecting the Dots-Lesson for Leadership in a Startup World," that I have pulled some elements from it that could portend trouble ahead for Nvidia. I am not predicting that Nvidia will go under quickly or anything like that. They have tremendous assets and momentum. But I am in the strategic planning business using scenarios; so why not think more openly? Here are the six ideas from John Chambers that Jensen Huang might want to ponder:
1. Great success attract great competitors, in all forms, large and small. In today's world even small competitors can be dangerous. Winning against competitors is not an easy game. Chambers also suggest that over-focusing on competitors is backward looking. He suggest looking forward to industry transitions and figuring those out and getting a leading position there. It is easy to lose track of this when current competition is also attacking. But Nvidia has to play the transition issue correctly.
2. Great power attracts others who want to use it for their purposes. U.S. political leaders in their concern about the rise of China want to use the power that Nvidia has to address those so-called "national security" concerns. This is what is bothering Jensen now as he sees those interests not aligning with market and industry realities. Building his company in a silo-ed market is truly dangerous considering the barely out of infancy of the whole AI industry. A mistake here could be very costly. Chambers suggest having clear winning end points and playing out the entire games (using scenarios) is key here.
3. Chambers is really clear that doing "too much of the right thing" can kill you. This is a form of the innovators dilemma, as protecting current success and making incremental improvements IS NOT innovation. He suggests that a company must disrupt itself. This is very hard to do with a Board being too conservative and focused on current stock prices. So yes, Nvidia can be disrupted by others, which seems to be what DeepSeek is showing.
4. Chambers suggest that charting future disruption means thinking big and sometimes taking big risks. As AI is in its infancy, clearly there is room for transitional moments and step changes. Being blind-sided by one of those can kill a company. Chambers explains how CISCO managed through some of those. It took some heart-rending work to do it. This is about the people running the place. Chambers heart-breaking explanation on the fall of Wang Computer lays this out. A brilliant creative scientific mind, just got attached to his own fears and missed a turn. This is another example of how people find it very difficult to deal with total context shifts. Maybe Jensen has an internalized belief that could cause him to mis-play a market transition as Dr. Wang did.
5. In thinking through scenarios Chambers also isolate what I call macro-scenario shifts. This is when larger scale forces impact those at lower levels. This of the recent storms in Texas where the weather system destroyed land-based systems. In CISCO's past the collapse of the internet bubble was such a case. Clearly in light of the global implications of AI, its energy and water use issues, its massive capital needs, and other issues expose market developments to macro-level shifts. Some of this work requires thinking about the unbelievable. Chambers suggest that talking to customers and diverse group of people and reading small signals can help here. I trust Jensen and his team are doing some of that.
Again, I am not suggesting that any of the above will happen, but that in some form they CAN happen. Thinking them through and developing paths forward would be helpful to Nvidia.
I am sure that Jensen has some of the smartest people in the world advising him, and a little unknown like me can be largely ignored. But here is something from John Chambers, Chairman Emeritus of Cisco Systems from his book, "Connecting the Dots."
"You have to compete in the moment but also rise above the short-term wins and problem to think 3, 5, and even 10 years out to pursue bigger and bolder dreams.
At Cisco, we were sometimes too early or we took on too much, but the reason we ultimately stayed on top is that we focused on connecting the dots. We developed a playbook for everything from how we acquired companies to how we managed people, how we dealt with customers to how we digitized countries."
This is the kind of thinking that both micro and macro scenario analysis tools can help with. Micro scenarios target smaller areas like product market evolution. Macro scenarios look at the broader forces shaping the larger business environment. Having both types in dialogue with each other in the strategy process of a company is how playbooks that Chambers is talking about get developed.