Office 365 has fundamentally changed the market for small business IT – but don’t be trapped into thinking it’s the only option

Office 365 is Microsoft’s fastest growing product ever. Promising simplicity and cost-effectiveness, it has attracted small businesses in their droves. But many have found themselves struggling to realise its benefits: it is not nearly as simple as it appears, and is not intrinsically flexible enough to adapt to the needs of every small business.

Nevertheless, its popularity has quietly transformed the entire IT market for small businesses, to the extent that there is no obvious competitor to the Microsoft product. How did this happen, and what are the options now for small business IT strategies?

The way things were

Only three years ago the standard small business IT configuration was a physical server that sat under a desk and was connected to everything via cables or wireless. If you wanted to work remotely you did so through an internet connection to the server.

This configuration meant that you needed some sort of support in order to maintain the server and support users at home and in the office. This was provided either by an employee or, more often, by a dedicated IT support company.

For most businesses, this worked reasonably well, although there were some annoyances. They would have to buy software licences, for example. The server hardware and software would go out of date. Replacing the server represented a large capital expense.

The introduction of Microsoft’s Office 365

With the rapid phasing-out of Small Business Server, previously the standard Microsoft product for this environment, the majority of small businesses took the default option and subscribed to Office 365.

At first glance, this makes sense. Office 365 relieves most of the disadvantages of the server set-up. Small business owners no longer have to spend lumps of capital on buying and replacing servers, or retain an IT support company to maintain those servers. Software is paid for via a simple, and relatively low-cost, monthly subscription. Data can be accessed remotely.

Office 365 was heavily promoted and the benefits seemed very attractive. Besides, with server software unavailable or unaffordable, many small businesses rushed to take it up without even considering what the downsides might be. And they, in fact, are many.

Internet connection

Most businesses suffer from poorer internet connections than people get at home. With a physical server, a 10-person business would have had one internet connection which was only used when people were actively browsing or sending an email. With Office 365, all 10 people are constantly sharing what might be a poor internet connection.

Obviously, this problem can be mitigated by investing in better internet provision, but this will add to the overall cost of Office 365.

Sharing data

Small business owners often subscribe to Office 365 because they have used and liked the home/personal version and assumed that they would be working on a scaled-up version of what they already knew.

Unfortunately, it’s not quite as easy as that, and the part of Office 365 that is least easy to scale is sharing data. It can be done by creating a ‘team site’ in which you can put all the data that the business needs to share, but it is nowhere near as simple as an old-fashioned shared drive. It needs to be set up and administered by someone who is confident and savvy with IT, which means either employing someone with those skills (and the time to spend on site admin), or contracting an external IT company.

Email

Office 365 places limits on the size of your email box, and limits on the size of attachments that may be sent with email. They are not too restrictive for most businesses, but creative services companies that may want to send videos or large numbers of photographs to their clients will probably have to investigate other ways of sending these files.

Another problem is the complexity of migrating email to Office 365. It is fine if you are a small start-up with one simple email address. But if you try to migrate legacy emails from your server or assorted gmail accounts it’s well beyond the technical capabilities of the average small business owner. Most small businesses, therefore, will need migration help from an IT support company.

Data migration

You might also run into trouble migrating your data if your file names fall foul of Office 365’s very rigid rules. You could either have a spring clean just before migration and rename everything, or accept that you will be keeping your old server around for a while to store files with old-style names.

Security

While there are various security features built in to Office 365, they may not be adequate to cope with the very latest threats. If your business holds very sensitive data or is dependent on intellectual property, you will probably have to add on extra levels of protection. This may include encrypting data before storing it in the cloud.

What it boils down to is the simple fact that Microsoft is a large, global organisation. To be efficient at that scale means it supplies one size that will fit all – even if that is not always going to be in the best interests of their customers. As with any monopoly provider, it is in a position to manipulate and dictate to the market, and if you’re a small business with a limited budget and limited IT expertise, you may feel you have little choice but to go along with it.

But your IT infrastructure and strategy has to work for you, however large or small your business is. If you have not yet subscribed to Office 365 you should take some time to think through the issues listed above. You might decide that Office 365 is right for you, but you will need to opt for a higher subscription rate from the start in order to be able to share a large amount of data. Or you could choose a basic level of Office 365 and work with an IT support company to configure it to work with other services such as Dropbox. Or indeed you could implement another set of products altogether, such as Googledocs.

If you are already a subscriber and bits are not working for you, there is always the option of reconfiguring it or combining it with other software, providing you can enlist the help of an IT specialist. The IT landscape has changed irrevocably but that does not mean that you should run your business around the capabilities or limitations of Office 365.

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