Net Gains

Net Gains

How does one pick a winner on the web these days, anyway? When judging (US)CIO's fourth annual 50/50 Web Business awards, we faced a burning question: What really matters today on the Web, as opposed to three, six or 12 months ago? Every year, the criteria for these awards have evolved to reflect the turmoil in the marketplace--which means that finding a winning Web strategy remains elusive. After all, not even Inc.'s Jeff Bezos has the formula yet. Four years ago, it was enough to have a killer-looking marketing site with snazzy graphics, lots of links and a rudimentary search engine.

For internal sites, posting the employee directory and HR benefits was sufficient. Of course, today's sites need discussion areas, e-commerce, advanced search engines, online invoicing, real-time inventory tracking, fancy interactive tools--and did we mention e-commerce?

But it's not all about money--especially since few sites are making any yet. On both intranet and Internet sites, customers want a sense of community, they want knowledge--and to varying degrees, they want to be entertained. Sites that enable visitors to post and share data easily, educate themselves and make new connections are winning with both customers and senior executives.

This year's 50/50 awards were judged on the following criteria: presentation and design, navigation/user experience, features and functions, business value, innovation and overall service to the customer or target market. The applications were entirely self-nominated, which explains the absence of companies like and Yahoo Inc. -- sites that would surely have graced our list of winners if they'd bothered to apply.

Over the course of one week, we judges became bona fide, coffee-swilling power-surfers. Our beards grew dark and our eyes turned red. We clicked on every button and followed every link, dead or alive. We tested features, searched for factoids great and small. We shopped for tacky gifts; we shopped for mortgages and homes. We learned more than we wanted to about topics in which we had little inherent interest (a site for lab technicians) and less than we would have liked about subjects we found compelling and personally interesting (wine sites).

Read on to learn about the Internet and intranet trends we uncovered in this year's Web stars.

(For a complete list of this year's (US)Web Business 50/50 winners, INTERNET WINNERS Fundamentals First While profits remain elusive, creativity and innovation are not in short supply When it comes to e-commerce, websites have to deliver business value to survive long-term, and they have to offer something more compelling than the brick-and-mortar experience. Customers demand comparison shopping, 3-D images, personalisation, auctions, easy ordering and returns, advanced search mechanisms, real-time voice-enabled customer service links and nanosecond response time. And above all, sites need to continually update their offerings to meet customer needs and keep up with technology developments. Tried-and-true superstars like Charles Schwab and Dell Computer Corp. are still growing and improving their sites. Schwab's new Learning Center, a set of free online courses for neophyte investors, is a fine example of adding value in order to attract new customers. And it's hard to argue with's business model, since the company brings in a whopping US$34 million a day in online sales. recently added two new services, Web hosting and a small-business center. The company also has an impressive global presence, with unique sites for 80 countries in 23 different languages.

It's fair to say that the Internet is transforming all industries in some way, but a few have undergone wholesale revolution: financial services and computer hardware and networking, thanks to companies like Schwab and Dell. Another example of gut-wrenching change is quickly playing out in the automobile industry. The February megadeal announced by Ford, DaimlerChrysler and General Motors to develop a supplier exchange on the Web is a sure sign that the business of manufacturing and selling cars will never be the same. Two of our winners--Toyota Motor Sales U.S.A. and Vauxhall Motors (a Bedfordshire, England-based division of General Motors)--have somehow managed to make buying a car a fun experience, observed one CIO judge. At Vauxhall's site, visitors are able to search for a new or used car across several specifications, select custom features, apply for financing, find a dealer and make an appointment for a test-drive. No pushy dealers or haggling, and Vauxhall--which has already sold 400 cars online since the site launched last November--promises to deliver new wheels within a week. Toyota representatives would not reveal sales numbers for its site, which offers similar features. The secrecy is likely an indication of the fear of alienating traditional sales and distribution channels that large companies experience as they transition to e-commerce.


Call them vertical portals, industry exchanges or e-marketplaces, these enormous supplier-buyer sites have suddenly proliferated in almost every major industry. Ventro Corp.'s was one of the first: its life sciences portal offering 1 million products from some 2,200 suppliers rang up more than US$30 million in sales in 1999. Lab equipment marketplace has a well-designed site where lab technicians can create a personalized catalog or participate in auctions. The company scores points on the integration side too: Suppliers can track their orders and inventory at the site through links with their internal systems. LoopNet's, a marketplace for commercial real estate, lists more than US$68 billion in properties for sale. About 90,000 commercial real estate professionals use the site each month to list or search for properties and access online loan origination applications.

E-marketplaces are not just for the benefit of large companies that buy millions of dollars of goods a year. Another winner, UMB Bank's, caters to small and midsize businesses by offering group discounts on name-brand office products and services to members, as well as an auction center for used goods. These Internet marketplaces are a sign of the increasing power customers are wresting over suppliers on price, service and selection. Suppliers that don't sign up with these convenient portals will soon discover customers clicking their business elsewhere.


But not everyone comes to the web to shop. People still use the Internet to gather information and to connect with others. We saw a lot of this community building going on among our winners--including those sites that are also hoping to sell you something. Vintage Directions', a gorgeous online sanctuary for oenophiles, offers visitors sophisticated search tools that allow them to select the perfect wine--down to body and complexity. You can also find ideal food pairings, access a glossary, join any number of clubs or participate in an auction.

Meanwhile, a pure community site caught our eye: Abuzz Technologies' Got a burning question on any topic under the sun? Post it at Abuzz and one of the site's 7,000 members will send the answer by e-mail--in minutes or hours, no less.


Several winners fall loosely into the "thank you for making my life simpler" category. After visiting the and American Airlines ( travel sites, who'd ever want to call an airline or visit a travel-agent office again? Both sites offer soup-to-nuts travel planning and tons of interactive tools--including integration capabilities with PalmPilots. American Airlines generated US$500 million in online revenue in 1999. Says one CIO judge: "Here's a great example of taking a service, putting it on the Web and making it better than it was offline." Travelocity--which has a distinct advantage over American in that it allows reservations for some 400 airlines--has two terrific features for budget-minded travelers: a low-fare finder and a fare-watcher tool that alerts the thrifty by e-mail when fares drop. Visitors can choose from a mind-boggling array of 45,000 hotels, 50 car rental companies and 70,000 vacation packages worldwide. Now that's selection--and no more long hold times with the ticket counter, either.

Convenience (and peace of mind) was also a consideration in our selection of Cyber-Signs' Kinderview, a website where nervous parents can check up on their kids in day care from the comfort of their desks. Facilities that sign up with Kinderview install video cameras on their premises, while Kinderview manages the video feeds that are sent to its site.

The list of great, time-saving ideas goes on: is one of several handy sites that will pay and manage your monthly bills and integrates with personal financial software like Quicken, all for US $8.95 per month. At, mobile professionals can record time and expenses and file invoices electronically--using the Web or a PalmPilot. For independent contractors and freelancers, this is an easy, hassle-free and cost-effective service for managing those nitpicking administrative tasks. The Massachusetts Port Authority's is a site we wish every major airport offered: Log on for the latest information on flights, weather, traffic, public transportation and parking at Boston's busy Logan International Airport.


One of the most fascinating aspects of the Web is the fountain of creativity that continues to flow from the geyser of dotcom fervor. Undoubtedly, we will continue to see fresh and innovative products, services and business models that just aren't possible or feasible in the physical world. There's Visualize, a lowbrow site for art lovers who know what they like but don't want to be intimidated by New York City gallery attitudes. The site's Art Matcher tool finds art based on your preferences and budget, while Art Mail allows you to send images to friends. allows community-minded shoppers to donate a percentage of their purchase to a favorite charity, from a list of some 200 retailers and more than 7,000 charities. Finally, e-commerce with a cause.

Then there's Freedom Channel, a perfect example of the democratization of the Internet. Just in time for election season, the site allows political candidates at all levels to air campaign ads in what the site's promoters call an "unfiltered" environment.

While many of this year's Internet winners have yet to turn a profit, they are setting standards for convenience, service, innovation and creativity.

Former Senior Writer Polly Schneider caught dotcom fever; she is now a senior editor at The Industry Standard.


Blurring the Lines

Increasingly, websites are becoming indistinguishable from the businesses that create them We've been judging intranet sites in the 50/50 awards since 1997. And we've come to feel as if we're watching a soft, slow-motion collision in which no one ever gets hurt. On the contrary, new and better things keep arising. Perhaps a sharper likeness can be drawn to the famous old Reese's Peanut Butter Cup commercial where the guy with a chocolate bar turns a corner and runs into the guy with an open jar of peanut butter. Peanut butter gets on the chocolate and chocolate gets into the peanut butter. And eureka! A novel product is born out of the union of two separate elements.

Since the inception of these awards, both Tim and I have predicted, and gradually witnessed, this serendipitous merging of formerly discrete Web intentions. The signs grow ever more numerous each year.

This year, for instance, we have two winners with essentially identical business applications that submitted, in the case of, in the intranet/extranet category and, in the case of, in the Internet category. When the submitters themselves can't clearly identify where they belong, we have a blurred environment. (For purposes of consistency, we migrated to the intranet/extranet grouping. But we might as easily have sent in the opposite direction.) The point? Recalling with fondness a once-popular bit of consultant speak, all websites are simply platforms for interacting with one or another set of stakeholders. Whether these are employees, trading partners, end customers or nodes along the extended supply chain makes little difference; all of these constituencies are customers of some kind. You may choose to vary the language you use to address them, the type of information you present to them or the functionality into which that information is woven; but the Web is increasingly becoming a unified, well-integrated business platform that resembles the overall business in its completeness.

It has been gratifying to observe how deeply embedded Web functionality has become in business; and, conversely, how deeply embedded business functionality has become in websites of all categories. Rather than fitting easily in strictly defined bins, many sites now draw on widely diverse pools of data and serve the varied interests of multiple segments. We note this blurring effect because--who knows?--maybe next year we will give up splitting our honorees into equal 50s. Perhaps we'll just have an even 100, and leave it at that. For now, though, here are some of the key trends culled from the intranet/extranet world, circa mid 2000.


Some of the repeat winners are showing dramatic economies as their sites become more valuable and capable. Cisco Systems Inc.'s intranet reportedly saves the company US$75 million a year attributable to a variety of Web-delivered employee services. Ernst & Young's KnowledgeWeb has refined its publishing architecture to preserve the "expressive needs" of unique communities, while eliminating redundant efforts; this has led to a savings of more than US$3 million. IBM cites savings of more than US$200 million resulting from delivering 25 percent of employee training over the Web.

Value of this magnitude would be impossible without sites that have grown to be both massive in scale and broadly pervasive. At Ford Motor Co., for instance, there are more than 150,000 active users. The intranet is the single point of contact for Ford's knowledge resources that use it for such strategic activities as product development and major team-based global initiatives. Ford cites direct quality improvements in its product-development process that are attributable to the website. And repeat winner Ford was an early signatory to the notion that a company's entire way of working could be migrated to the Web environment.


While we suspect that it takes more than a website to trigger wholesale cultural change, some of this year's winning intranets cited a variety of cultural benefits and objectives. IBM, with 300,000 users worldwide, asserts its intranet portal is a blunt instrument for both communicating and enacting culture change--something of a challenge for a company of IBM's mass. Nortel Networks has created a site devoted to boosting time-to-market performance for new products. The goal of a 50 percent time-to-market improvement represents a great leap forward, with matching cultural implications.

Perot Systems, another multiple repeater, doesn't use its intranet to change the culture, exactly, but it does serve as the primary medium (during a time of rampant growth) for introducing Perot's many new hires to the company's culture, methodologies and skills. Perot has deepened the site's value over the past few years by making it the main engine for matching people and skills to projects; training people in needed new skills and sharing knowledge gleaned in the course of client engagements.


Of particular interest are some of the sites from the nonprofit sector, long disparaged--with some justification--for its lack of technologic excellence. The Camp Fire Boys and Girls' Camp Fire Cafe is described as the first technology venture the youth organization has ever undertaken. It is plainly meant to bootstrap Camp Fire into a more technology-friendly posture. According to submitter and Deputy National Executive Director Robert Browell, "The Camp Fire Cafe was released to our membership on Dec. 7, 1999, Pearl Harbor Day, as our attack on our system's lack of technology focus." As of the entry deadline, the extranet had penetrated some 20 percent of the nationwide Camp Fire chapters.

The U.S. Department of Veterans Affairs has a site that aims to improve the delivery of medical care, long a bone of contention among veterans. The system expedites health claims and the determination of benefits by helping schedule medical exams and communicate exam results to VA claims-rating specialists (the people who substantiate claims and set benefit levels). When the system is fully deployed, it will serve 58 regional offices.

Wildwood Programs is a nonprofit New York State agency that provides special-education services to learning-disabled students in the Albany-area public schools. To maximize the direct educational benefit students get from teachers, the site's worthy aim is to make mandated paperwork and reporting less time-consuming. As many communities debate scaling back on costly commitments to special education, a system that makes the administrative work less burdensome and demanding of teachers' time sells itself.


We note a couple of novel instances of shared developmental parentage. The University of California, Irvine, Graduate School of Management created a terrific site, called Catalyst, on which the curriculum and all interactions and transactions regarding it can be found. The site was subsequently licensed to Purdue University's school of management. And now that site is funneling enhancements back to Catalyst.

In a slightly different wrinkle, repeat winner Knowledge Today, the knowledge management and operational support site of the U.S. Joint Forces Command (the armed forces management structure that serves the commander in chief), shares its original parent with a Secretary of Defense site known as A-Net. Recently, Lt. Col. Mike Dorohovich, the guiding hand in developing Knowledge Today, took his expertise to the DOD, where he championed A-Net. As with the UC-Purdue example, Dorohovich's new creation is helping enrich his firstborn, Knowledge Today, through the close collaboration of the respective staffs. For that reason, we consolidated the two sites as a single winner.


A number of winning entrants integrate user-satisfaction metrics through ongoing surveys. NCR Corp.'s NCR University Online Campus gets a better-than-90-percent response rate to its regular e-mail surveys. PricewaterhouseCoopers' KnowledgeCurve gathers feedback on the fly, with a mechanism that let users respond to every page of content. And at IBM, a worldwide employee survey reveals that its intranet was the second-highest-rated source of information in the company, beating out "my manager"; page views quintupled from 400,000 to 1.9 million during the past year; and user satisfaction rose by 68 percent year over year.

In fact, the only discouraging note we would sound is that this year showed little evidence of boundary-smashing innovation. The year 2000 benchmarks of progress tend to be measured and incremental. It's as if the practitioners are gathering their strength for an impending dash ahead. We look forward to next year's results.

When not surfing the Web, Editorial Director Lew McCreary is busy working on Darwin magazine. Send him a note at When not surfing the Web, Senior Vice President Tim Horgan is busy working on the site. He can be reached at

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