Please note – this isn't a one-shot, but at this point in time I have no intentions in continuing this story (though I eventually may). Rather, this is just an idea that formed in my head over the past few days. If somebody wants to take a crack at making this a full-length fanfic, you're free to take up the project.
Without further ado...
In war, many legends fall, but many more are forged. One such legend that was born during the Second Great Shinobi War was Hatake Sakumo, Konoha's White Fang, famous for his weapon the Hakkō Chakura To, a tanto that gave off white chakra. His prowess both on the battlefield and in the shadows caused foes to fear the mere mention of his name, and his reputation surpassed even the Sannin, whose own legacy had been forged in Rain Country. At the same time, however, Hatake Sakumo would incite a revolution; specifically, a revolution in the ideals of teamwork. Hatake preached teamwork above the mission wherever possible.
Sakumo's name almost fell short, however, shortly after the war on the Amegakure front had ended and the bulk of Konoha's forces turned to face Sunagakure. Shortly after his squad successfully assassinated the son and daughter-in-law of Chiyo of Suna, the Sandaime Hokage ordered Sakumo to kill an important political hostage from Iwagakure and implant fake evidence to make it look like Suna's fault. When Sakumo realised the mission was impossible to accomplish, he ordered his teammates to retreat, and went in alone on a suicide mission. Surprisingly, Sakumo managed to successfully complete the mission, and made it back to Konoha safely.
The result was a death knell to Suna in the war, as Iwa pulled out after seeing how Suna had 'dealt' with the Tsuchikage's younger sister. Shortly thereafter, Hatake Sakumo's former genin squad, made up of Akimichi Chouza, Yamanaka Inoichi and Nara Shikaku became famous as their legendary teamwork felled Suna shinobi after Suna shinobi. This had the effect of ending the war over a year earlier than it might have originally. Following the hastily-signed peace treaty, Konoha began to flourish, while the Sandaime Kazekage's presence kept Suna stabilized.
With the end of the Second Great Shinobi War, the Sandaime Hokage, Sarutobi Hiruzen, who at the time was 48 and had been Hokage for over a quarter of a century following the death of his sensei the Nidaime Hokage shortly after the First Great Shinobi War, decided to step aside and pass the title onto Hatake Sakumo, who would become the Yondaime Hokage. Orochimaru of the Sannin originally desired the position, but realized he was nothing in comparison to the White Fang, and decided to bide his time for when a new Hokage would be needed. While Orochimaru stayed in Konoha, Jiraiya of the Sannin went back to mentoring his genin team he had to temporarily abandon during the last year of the war, while Senju Tsunade and her new husband, Senju Dan (who married into the family) left on a world tour. Tsunade's little brother, Senju Nawaki stayed behind and took over as the head of the Senju family, and quickly rose through the ranks on his talent and hard work.
Peace stayed in the world for half a decade before war disrupted it again, as the Sandaime Kazekage suddenly disappeared from Suna. Between the Third's disappearance and the hasty appointment of the Yondaime, Suna's emergency council panicked, with their actions inadvertently starting a Third Great Shinobi War. Any chance at a quick peace was destroyed with a failed assassination attempt on the Yondaime Hokage's second son, Hatake Karasu. The assassin's identity was never uncovered. In the diplomacy that ensued, Iwa and Konoha allied up against Suna and Kumo, with the buffer countries between each of the Four Great powers leaning to either side, most notably with Ame allying with Suna and Kumo and Kusa with Iwa and Konoha. Kirigakure stayed out of the war due to a great hurricane that smashed into the village a year before.
Kumo entered the war hitting heavily, as they sent out their two jinchuuriki in the early portions of the war. Most notably, the man known as Killer Bee took out three platoons of Konoha ANBU in one battle with kenjutsu alone, before transforming into the Hachibi and killing of several more. Suna did not have such a weapon at their disposal, the last Ichibi container having died a couple of years after the Second Great Shinobi War from a weak body, but managed to hold off several advances by using the conditions of the desert to their advantage. Konoha and Iwa were unable to compensate for this; in Konoha, none of the Uchiha clan had enough mastery over their Sharingan to subdue a bijuu, while none of the Senju had been able to manifest the Mokuton, and Konoha had no jinchuuriki. Iwa was little better; the Yonbi container was in his late fifties, and did not want to risk his body giving out in the middle of battle and unleashing the Yonbi's wrath, while the Gobi container was only seven at the war's start, and would not be able to handle the Gobi's power for some time. Ame, known for Salamander Hanzo's brutal ways, also managed to help greatly in the war effort, invading Kusa and breaking a long-held unofficial non-aggression pact between the two small villages. Fittingly, because wind and lightning were the elemental affinities that were the strongest offensively, they slowly began to push back the enemy lines.
It was the birth of two new legends in the flames of war that won Konoha and Iwa the war. On the Kumo front, Namikaze Minato, prized genin pupil of Jiraiya of the Sannin, devised several chakra control techniques that increased the efficiency of the Konoha ninja. This led to his prized pure chakra manipulation technique known as the Rasengan, which was nigh upon unstoppable in one-on-one battles for its grinding and shredding effects. Only one person survived a direct hit from the Rasengan: Nii Yugito, container of the Nibi no Bakemono, who was taken out of the war for six months because of the sheer extent of the injuries and chakra exhaustion she had. Later on, he used his genius in sealing to devise a teleportation technique known as the Hiraishin, and turned the tide of the war by killing over one hundred shinobi in two large-scale battles each.
Meanwhile, on the Suna front, Senju Nawaki manifested the Mokuton bloodline, long thought to have been a one-time bloodline wielded only by the Shodai Hokage. After careful manipulation, Nawaki managed to grow foliage in the desert, which Konoha used to their advantage; Nawaki planted multiple forests between Konoha and Suna, which the Konoha ninja used as their outposts and staging points for attacks. Suna shinobi that tried to rout the Konoha nin from these forests were annihilated as the advantage of being in their natural environment had flipped sides. Finally, Kusa began to fight back against Ame through a massive saboteur effort, with poison killing many Amegakure fighters.
Shortly thereafter, the war ended as the Suna-Ame-Kumo alliance surrendered, seeing the momentum was against them. Kumo and Ame backed out with no surrender terms, while the Yondaime Kazekage surrended while at the same time striking a deal with Konoha: Suna would hand over some of its wind techniques and chakra exercises in exchange for Senju Nawaki and an escort staying in Suna for a year to use his Mokuton bloodline in encouraging plant growth. Suna hoped to stave off their declining economy by cutting down costs on importing food. Konoha agreed.
After Nawaki returned to Konoha, Sakumo finally decided it was near his time to retire, and came up with three choices for his replacement: the aforementioned Senju Nawaki, Namikaze Minato, or Orochimaru of the Sannin. With his sensei having been retired for over a decade and Sakumo's heavier discipline over his practices, Orochimaru no longer desired the Hokage seat, instead preferring to work in the medical division. Namikaze Minato originally considered the position, but after learning his wife Uzumaki Kushina was pregnant, declined, stating that he would rather not have to take on the responsibilities of the Hokage while juggling a growing family at the same time. Sakumo then began grooming Nawaki for the position, slowly relinquishing more of his duties over to the younger male.
The gradual resignation of the Yondaime was interrupted by an unexpected event: the Kyuubi no Kitsune no Youko had emerged into the world from Makai once more, and was headed for Konoha. Sakumo quickly formed a war council involving the Sannin, Sandaime, to-be-Godaime, Namikaze, Nara Shikaku, and several other high-placed active and retired ninjas, but excluding Danzou, the leader of ROOT. Initially, Nawaki hoped to be able to subdue the Kyuubi before it even got close to Konoha; however, after a short skirmish with the Kyuubi on the border of Fire Country, getting their quickly through the use of Minato's Hiraishin, Nawaki concluded he was incapable of doing so.
Following this disturbing revelation, the council came up with a last resort plan: a newborn child would have to be used as a human sacrifice for the Kyuubi to be sealed into. However, even Nawaki's Mokuton element was unable to weaken the Kyuubi enough for a regular sealing ceremony to work. Therefore, it was decided that somebody would have to go through the ultimate sacrifice: summoning the Death God to seal the Kyuubi into the newborn, and giving up their soul to reside in the Death God's stomach for all of eternity.
Sakumo originally was going to do it himself, until careful examination of the Shiki Fuin showed that older people would not be able to generate as much power from it, due to both their frailty and that the Shinigami wouldn't desire their soul as much because they were closer to death. Nawaki originally was going to do it himself, being only in his late twenties, but Minato offered himself up, stating that Nawaki would be too exhausted from the use of the Mokuton in subduing the beast. Although many were adamant against him sacrificing himself, most persistently his wife Namikaze-Uzumaki Kushina, who was due to go into labor at any time, in the end it was decided that only Minato would be in the right circumstances of youth and power to subdue the bijuu.
However, the council was still divided over a single issue: who to use to seal the Kyuubi into? They couldn't just use any newborn, lest the child not possess enough chakra to counteract the Kyuubi's yokai, so he or she had to be from a ninja family. Sakumo put his foot down on using an orphan, recognizing that if the jinchuuriki was found out, he or she would be hated by the general populace. At the same time, they couldn't use a clan child, or else the clan might raise him or her to be their own personal weapon.
Finally, to the distress of a fraught Kushina and Minato, they decided that their newborn son Namikaze Naruto was the only option: Kushina would still be alive to take care of Naruto, the Namikazes weren't from a clan, Minato was loathed but not really hated by Kumo, and Naruto would undoubtedly have a large chakra capacity due to his parents both being accomplished shinobi. Finally, to maintain the secrecy of the sealing, the public would be informed of the original effect of the Shiki Fuin – that both the caster and the target would be pulled into the Shinigami's stomach to fight for all of eternity – and allow them to conclude the Kyuubi's soul was gone, as opposed to being sealed. While the Hachibi's vessel was able to use its power to fight, none of the war council members were confident enough that the same could hold for young Naruto, as the Kyuubi was leaps and bounds above even the Hachibi's power.
Minato produced a flawless sealing mechanism that he used on his own son, and the sealing ceremony went by without a hitch. However, the Kyuubi's rampage had taken out part of Fire Country; by proxy, with less civilians in Fire Country, Konoha had less business, and it had also lost several hundred shinobi of its own in delaying the bijuu. After the battle was over, Sakumo informed the civilians and ninja of what Minato had supposedly done, and post-humously made Minato an honourary Hokage, before handing his position over to Nawaki.
After Kushina recovered from her childbirth, she stayed in Konoha for five years to raise her new son Naruto. However, wanderlust eventually struck her, and she took Naruto with her to travel the world for a few years, along with Tsunade, her husband Dan, and their twin seven-year-old sons Hashirama and Hiruzen. This is the story of the world, irreversibly altered by one man living instead of dying, succeeding where he once failed.
Of all the 'point of divergence' stories that people come up with, specifically the ones that occur before Naruto is born (or on the day of), I think that the one person that is overlooked the most is Hatake Sakumo. Ignore Obito, or Nawaki; Sakumo was a freaking LEGEND, who was on par with or stronger than the Sannin. If he lived, there would be repercussions. The reason I feel that he would become the Yondaime had he lived is fairly simple; the Sandaime only retired near the end or after the Third Great Shinobi War, and by that time he was around 55 to 57. If he had somebody reliable like the White Fang around, he likely would have retired a decade earlier and passed on the title. Sakumo is anywhere from ten to twenty years younger than the Sandaime, so he would be in the position longer than a 'transition' Hokage would be, but shorter than a long-reigned one would. Since Suna likely hates Hatake, and by proxy Konoha, the Third Great Shinobi War can't have the same sides as it did in canon, so here Iwa and Konoha are allies as opposed to being enemies.
Nawaki and Dan's survival : the reason these two survived is because they never WENT on the missions that got them killed. Sakumo's mission success ended the war earlier than it would have, hence there was never a need for them to go on a war mission. Other changes, although not mentioned in the actual chapter, include Kakashi being a lot more mellow, and Obito surviving (since they would never need to bomb the bridge in Kusa).
It's really difficult to get a fix on exactly WHEN the Second Great Shinobi War began and ended, and how long it went on for. About the only thing I can garner is that it went on for at least three years, Tsunade was in her late twenties or early thirties at the time, Jiraiya had yet to form Team Jiraiya, and only five to ten years later the Third Great Shinobi War started. For my story, one should presume that the end of the SGSW was five years before the start of the TGSW, and two years into the TGSW is when the events of Kakashi Gaiden would have occurred if not for the divergence, and presume that Sakumo died near the end of the SGSW. Basically, if my timeline is a bit screwed up, then just ignore it.
One thing I should point out about the Shinobi Wars that may reflect across my writing – my belief is that Shinobi Wars are NOT for territory. It is the daimyos and the actual countries themselves that war against each other for territory. Rather, the Shinobi Wars are used for a nation to boost their own prestige amongst clients, and to reduce the manpower and effectiveness of other hidden villages.