Tariff Rate of 15% Should Be ‘Manageable' for Europe, Says BNP Paribas
'If tariffs let's say are around 15% for the EU, it should be manageable,' Lars Machenil, the chief financial officer of BNP Paribas SA, said in an interview on Bloomberg TV Thursday.
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How Smart Leaders Use Constraints to Drive Strategic Innovation
Recently, reports began circulating that Nvidia was developing a detuned version of its next-generation Blackwell chip for China. The new chip would be slower on paper, lower priced, and engineered to comply with U.S. export limits. This wasn't a retreat—it was a redesign. Rather than waiting for the wall to move, the company chose to build right up to the wall. Nvidia's decision captures something essential about leadership under pressure. When reality draws a hard line, the instinct is to negotiate for more room. Another quarter. Another budget cycle. Another exemption. The alternative is to treat the line itself as part of the brief. Nvidia's response is less about salvaging a market than about reframing the problem: take the rule, freeze it, and optimize around it faster than anyone else can respond. The limit becomes an input. The boundary becomes an edge to cut against. Most organizations don't work this way. Most teams treat constraints as temporary inconveniences. They lobby around them, litigate them, or wait them out. Yet the firms that keep outmaneuvering their peers treat constraint as a forcing function for clarity, speed, and differentiation. Leadership is difficult even in the best of times. And these aren't the best of times. Markets are unsettled, geopolitics shows up inside product roadmaps, and investors ask for discipline and outsized growth at the same time. Teams are stretched. Wanting more room is understandable. The task is to find clarity inside the room that actually exists. The Power of Constraints Psychologists and designers have long understood the power of limits. If you were asked to name as many white objects as you could, many of us would stop after five or six: clouds, snow, paper, teeth... But narrow the frame to white objects in the refrigerator and people's lists grow quickly: milk, eggs, yogurt, cauliflower, sour cream, leftover rice... The boundary doesn't reduce imagination; it directs attention and sharpens perception. Amazon's two‑pizza team rule was introduced as that kind of structural discipline. Teams were capped at the size that could be fed with two pizzas, not as a gimmick but as a principle. It was a deliberate constraint on group size that encouraged accountability, clear ownership, and speed. With a small enough team, there's little room for ambiguity. Decisions are made closer to the work. Apple, often discussed as a company of boundless ambition, operates with an unusual level of internal constraint. Consider the number of SKUs and the narrowness of the design language. With artificial intelligence, privacy is prioritized, on-device processing is preferred, and partnerships are introduced cautiously and selectively. A peculiar paradox now defines strategy work. Many leaders face too much of everything: too many tools, data, priorities, and meetings to align too many stakeholders. In that context, additional resources often slow the system down. The surface area of indecision expands, and momentum leaks away. Seen through that lens, Nvidia's move is instructive. Instead of lamenting what can't be built or sold, the question shifts to what must be built to win inside the boundary. Constraint ceases to be the bottleneck. It becomes the clarifier. Reacting to Constraints Most businesses face three kinds of constraints. There are imposed constraints: regulators, geopolitics, macro shocks, activist boards. Nvidia's China strategy sits here. The boundary is hard, public, and rarely negotiable on the timelines that matter to product and go‑to‑market teams. There are structural constraints: legacy tech stacks, capital availability, brittle supply chains, outdated incentive systems, operating‑model debt, and talent gaps. These constraints are rarely acknowledged because they feel like the water the organization swims in every day. But there are chosen constraints, too: limits leaders set deliberately to produce sharper strategy and faster execution. Amazon's team size rule and Apple's SKU discipline fall into this category. The distinction matters. An imposed constraint demands adaptation. A structural constraint demands redesign. A chosen constraint demands leadership. When it's no longer plausible that more is the answer, it becomes easier to see that less often can be. Operating Inside a Boundary Many companies have intricate criteria for funding projects and almost none for killing them. Under a constraint, the kill criteria are built into the brief from the outset. The team knows what would cause them to stop. That clarity accelerates learning. Of course, constraints amplify accountability only if it's obvious who holds the pen. If a project has five sponsors and ten reviewers, the constraint turns into politics. If it has one owner, it turns into progress. And make no mistake: the narrative matters. There's a psychological cost when constraint is framed as austerity. People feel punished and hide their ambitions. Framed as concentration, the same constraint invites professionalism rather than martyrdom. Trust builds when leaders say no to expansion, but then protect the teams working inside the smaller mandate. Constraints work best when people understand the game they're playing. Telling an organization to do more with less generates anxiety. Explaining where the line sits, why it exists, and how the team intends to win inside it generates focus. Budget becomes a design instrument when it's fixed early and defended. Teams turn time into a forcing function when they announce a release date before work begins. When Netflix decided to start developing its own content, it didn't launch into it with a sprawling studio and Game of Thrones budgets. It began with House of Cards, a show free of expensive CGI dragons. Still, the company had a focused, data‑informed thesis of what would appeal to its audience. Working inside limitations led to sharper choices and a stronger debut. Getting Started with Constraints Leadership under constraint tends to follow a recognizable sequence. The boundary conditions are frozen. The rule, the regulator, the budget, or the headcount is treated as an input rather than a grievance. The design brief then makes explicit what must be true to win inside that line, what has to ship, and what will be deliberately cut. Ownership is concentrated in a small, fast team rather than diluted across a large coalition. Decisions are time‑boxed so that momentum is protected. The constraint is narrated so the organization understands why the wall exists, what it's teaching, and how the team intends to win inside it. One initiative that truly matters can be selected and treated with the same clarity Nvidia is applying to its China strategy. The central constraint can be written in a single sentence—regulation, budget, timeline, talent, compute, attention—and held fixed. That constraint can then be translated into a specification: what has to be true to succeed inside it, and what will be cut. A small team can be appointed, given no more than sixty days, and asked to deliver something concrete rather than something perfect. To be sure, not every constraint produces clarity. Some are arbitrary, performative, or so severe that they starve the work rather than focus it. The task is to decide which boundaries are worth accepting, which must be redesigned, and which should be chosen on purpose—and to move faster once that difference is clear. The Deeper Challenge for Leaders In a zero-interest-rate environment, conversations tended to revolve around removing limits: more funding, more hiring, more time. All of that signaled ambition, yet it often spread attention thinner. But there's another way to view the game. A small, focused mission signals that the work matters and that the organization trusts the team to move with speed and clarity. Constraint, in this reading, isn't a penalty. It's a commitment to coherence. When leaders embrace constraint, they force prioritization. They grant permission to be decisive. They encourage a kind of moral clarity: this is the thing being built, for these people, at this moment. Everything else is noise. That clarity shows up in shorter feedback loops, in smaller teams making bigger calls, and in an organization that tells a consistent story about what matters. So the brief can be frozen. The timebox can be set. The constraint can be named. The final step is to help the team see that the work isn't about operating with less, but about discovering what's essential and executing against it with speed and care. The future won't be won by the company with the most room to run. It will be won by the companies that know how to find the wall and run up against it. To use it not as a limit, but as
