BUSINESSWEEK ONLINE : SEPTEMBER 27, 1999 ISSUE
COVER STORY -- E.BIZ -- THE E.BIZ 25

John Hagel III


JOHN HAGEL III

McKINSEY & CO.

Position: Principal

Contribution: Wrote two books, Net Worth and Net Gain, that were early in pointing the way to Internet success.

Ambition: Publish the much-awaited Net Net, which tells established companies how to harness the Web and avoid being roadkill.

John Maynard Keynes didn't live on Internet time, but if he had, he probably would have been a fan of McKinsey & Co. strategy consultant John Hagel III. Practical, powerful men, Keynes wrote, are usually the unwitting slaves of some defunct intellectual scribbler. Hagel is a scribbler, but these days, because things move so fast, thinkers like him don't have to die before they get the credit due them.

Hagel is a fountain of concepts that are being put into practice all over the Web. In 1997, his book Net Gain (co-authored by Arthur G. Armstrong) suggested how noncommercial Web communities could use content, chat, and bulletin boards to promote e-commerce. Hagel's reputation stems from what happened after Net Gain came out: a burst of new sites serving special interests from cooking to golf. ''I think he's a combination of someone who can put a name on things that are already happening and an instigator,'' says Ron Martinez, CEO of Brodia Group, an e-commerce startup.

In 1999, Hagel was back with Net Worth (co-author, Marc Singer), arguing that a new way to make money online is to become an ''infomediary.'' An infomediary would gather its customers' profiles and seek out special offers and discounts for them from suppliers on the Net. He says an average consumer could save more than $1,100 a year even after paying commissions on purchases. The infomediary would make the rest of its money selling profiles to marketers, who would cough up because of the advantages of precise targeting.

What's next? Net Net. It's about how brick-and-mortar companies try to become infomediaries. Don't rush out to buy it, though. Net Net will be finished ''as soon as my wife lets me,'' says Hagel.

By Timothy J. Mullaney

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[empire builders]
Jeffrey P. Bezos
AMAZON.COM INC.

Stephen M. Case
AMERICA ONLINE INC.

Timothy A. Koogle
YAHOO! INC.

[the innovators]
Louis H. Borders
WEBVAN GROUP INC.

Jay S. Walker
PRICELINE.COM

Margaret C. Whitman
EBAY INC.

Glen Meakem
FREE MARKETS ONLINE INC.

James H. Clark
MYCFO INC.

Christos M. Cotsakos
E*TRADE GROUP INC.

[bankrollers]
Masayoshi Son
SOFTBANK CORP., JAPAN

Robert C. Kagle
BENCHMARK CAPITAL

Lawton W. Fitt
GOLDMAN SACHS & CO.

L. John Doerr
KLEINER PERKINS CAUFIELD & BYERS  

Bernard Arnault
LVMH MOET HENNESSY
LOUIS VUITTON  

[the visionaries]
Mary G. Meeker
MORGAN STANLEY DEAN WITTER

John Hagel III
MCKINSEY & CO.

William Joy
SUN MICROSYSTEMS

[the architects]
Louis V. Gerstner Jr.
IBM CORP.

Pehong Chen
BROADVISION INC.

David C. Peterschmidt
INKTOMI INC.

Kevin J. O'Connor
DOUBLECLICK

Ellen M. Hancock
EXODUS COMMUNICATIONS

[the pace setters]
David S. Pottruck
CHARLES SCHWAB CORP.

John T. Chambers
CISCO SYSTEMS

Michael S. Dell
DELL COMPUTER



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