Care for an NFT with your morning coffee?

Starbucks is certainly hoping so. The company recently announced that it will offer these digital stamps as part of its reward program. The NFTs can be redeemed for products or experiences, such as interactive games or coffee-related educational programs.

For all the cutting-edge hype, marketing professor Mohan Sawhney suspects the Starbuck’s effort hasn’t been well thought out. This lack of planning holds lessons for other organizations hoping to experiment with new technologies.

“Too often, business leaders chase after the latest technology trend, without first asking what problem they want to solve for customers and whether there is even a problem that needs solving,” he writes in a Fast Company article.

We’ll hear more from him today.

Know What Job You’re Trying to Do

Sawhney, who is also the director of Kellogg’s Center for Research in Technology & Innovation, says it’s imperative for leaders to know what they want new technology to accomplish before jumping on the bandwagon to start using it.

With Starbucks’s NFT program—dubbed Odyssey—the first question should be, “What job is Starbucks trying to do for its customers with Odyssey?” Sawhney writes. “While it is certainly on-brand for the company to engage in experiential innovation, it is not clear if Starbucks has thought through the ‘why’ behind this initiative.”

Starbucks should think through this question by laying out three possible “jobs” that Odyssey could be performing: (1) The program could be doing a social job, by bringing coffee lovers together in a virtual community; (2) it could be doing an entertainment job, providing its staff and customers with fun games and challenges, or (3) it could be performing an economic job, by letting loyalty program members buy and trade NFTs.

These are all legitimate ideas, Sawhney says. But Starbucks needs to decide which one it is pursuing so it can then design the technology around the goal.

If, for example, the company wants Odyssey to perform a social job, “the company would then work backward to design the features of the metaverse environment that would perform this job. These might include virtual ‘coffee lounges,’ hangouts, coffee meetups, and even dating over virtual coffee,” Sawhney writes.

All leaders eyeing experiments with new technology should go through a similar exercise, he says.

“Once you know where you are going in terms of the job to be done, the features will follow naturally,” he writes. “However, if you start with features, you can end up with a digital fishing expedition with no clear focus.”

You can read Sawhney’s full Fast Company article here.

What Does the Future of ESG Investing Look Like?

Investing that takes into account a firm’s environmental, social, and governmental activities—known as ESG—is at a crossroads.

Historically, ESG has been an uneasy marriage of investors looking for financial returns and those prioritizing social ones. In a bull market, where nearly all portfolios are strong, this kind of marriage is possible. But in a bear market, there are pressures to reward shareholders and prioritize portfolio performance.

Join professor Aaron Yoon for a free webinar on Nov. 17, during which he will lay out the state of ESG investing. He’ll draw from his own research to answer questions about which initiatives are likely to see a financial payoff, which are not, and what it will take for the sector to continue to thrive.

The one-hour webinar starts at noon central time on the 17th. You can register here.

LEADERSHIP TIP

“People need to consider long-term impact on relationships. An awkward conversation is well worth the long-term [effect] of demonstrating respect to your employer.”

—Clinical professor Brooke Vuckovic in The Washington Post, on why you shouldn’t opt for the seemingly easier path of quitting via email or Slack.