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Cloud Productivity: Office 365 vs. Google Apps

July 10, 2012

In our April newsletter, we introduced the basics of cloud computing with The ABC’s of Cloud Computing.  In this article we are going to dive a little deeper and talk about productivity applications in the cloud.  Productivity applications are a category of applications that can help your employees accomplish specific jobs such as creating and editing documents, presentations, spreadsheets, databases, charts and graphs.  With the cloud becoming a viable and value-added alternative to traditional desktop-based applications, many businesses are choosing cloud-based services such as Microsoft Office365 and Google Apps for their productivity application needs.  Why move to the cloud?  Some of the most common reasons we see are:

  • Infrastructure headaches
    • Running on an old server and the hardware upgrade is too costly
    • Unable to meet demands of your growing business
    • Wanting to simplify infrastructure and reduce cost
  • IT staffing concerns
    • Needing to free up IT staff to focus on core business
    • Cannot afford additional IT staff
  • Outdated software and limited features
    • Needing to upgrade from Office 2003 and older versions
    • Needing access to documents while traveling and without having to use VPN
    • Needing a way for employees to easily share and collaborate on documents
  • Looking for predictable annual costs

Cloud-based productivity applications can improve productivity, provide IT peace of mind and reduce total cost of ownership (TCO) compared to similar on-premise implementations. For example, the average ROI for an enterprise organization that implemented Microsoft Office 365 was 315% with a payback period of 4 months1 and 307% for Google Apps, with a payback period of 7 months. Some of the other benefits include:

  • Resolving infrastructure headaches
    • Avoiding costly infrastructure upgrades
    • Getting enterprise-level security and reliability
    • Ability to scale with your growing business without purchasing hardware
  • Resolving your IT staffing concerns
    • Less reliance on IT support for managing and maintaining application services on premise
  • Your business is always running the latest software
  • Improve productivity of workers
  • Predictable monthly costs in line with actual usage

So what matters most to you for productivity applications?  From our experience, we have found three things that tend to matter most: features, security, and reliability.  Below we compare two of the most popular services, Microsoft Office 365 and Google Apps, in each of these categories. 

Features

Google Apps and Microsoft Office 365 offer the user several cloud-based productivity features including:

  • Online Document Storage
  • Collaboration
  • Desktop Web Folders
  • Online Document Authoring
  • Productivity software including*:
    • Word Processing
    • Spreadsheets
    • Presentations
  • Full Text Search

*Note: Google calls its web-based document authoring software “Google Docs” which is a component of Google Apps.  Microsoft refers to theirs as “Office Web Apps” which is a component of Office 365.

These features allow your business to store and work with documents in the cloud without having to worry about the infrastructure to support it.  Both services are offered at low monthly rates with a per user, per month subscription model.

With Office 365, your users can create and edit documents on any compatible Windows or Mac computer that has an Internet connection.  In terms of platform compatibility, Google Apps has the edge.  It supports creating and editing documents on Windows, Mac, Linux, UNIX and other operating systems, giving it broader platform compatibility than Microsoft Office 365.  Both services provide features that are accessible on mobile devices, but their availability and performance vary depending on the platform. 

One area of clear difference between the two services is in creating and editing documents.  Using Google Docs can lead to frustration with loss of document integrity and loss of formatting.  For example, below is a partial screenshot of the same word document viewed in Office 365 (left) and Google Docs (right)3
 

The other difference you will notice is that Google Apps offers basic features while Microsoft Office 365 is feature “rich”.  For example, look at the following screenshot which shows the available chart formats in each service: 

Since Google Apps is focused on the top 10% of the features most commonly used4, your more sophisticated users may not find all the functionality they need.  For example, if your finance staff makes heavy use of Excel macros, they will not be pleased to discover that Google Docs is missing macro support5. If they need to create a spreadsheet with more than 256 columns or perform complex filtering and sorting, Google Docs will simply not cut it.  

Security

Microsoft Office 365 and Google Apps both provide secure access, as well as anti-spam and anti-virus technologies to protect against the latest threats.  Microsoft has demonstrated an edge in this category by consistently being the first to achieve important security benchmarks.  As of December 2011, Office 365 was the first major cloud-based productivity service to obtain certification under ISO/IEC 27001, a rigorous information security management benchmark.  It is also the first and only major cloud productivity service to furnish the European Union model clauses to help customers certify compliance with the European Commission’s stringent Data Protection Directive and the U.S.-mandated Health Insurance Portability and Accountability Act (HIPAA).6

Google recently announced on May 28, 2012 that its Google Apps became ISO/IEC 27001 certified7, and it has secured other important certifications including its certification under the Federal Information Security Management Act (FISMA).  Also, an independent third party auditor issued Google Apps an unqualified SSAE 16and ISAE 3402 Type II audit opinion.

One key distinction between the two is how they handle privacy.  Microsoft provides a transparent privacy policy emphasizing that you maintain ownership and control of your data.  Office 365 does not build advertising products out of customer data. It also does not scan your email or documents for building analytics, data mining, advertising or improving the service.  Google’s privacy policy allows them to collect your data and use it to improve advertising and other services in some instances. However, they do not share personal information with companies, organizations and individuals outside of Google except for a few circumstances, such as if you provide consent.

Reliability

Google Apps and Microsoft Office 365 both offer 99.9% availability service level agreements (SLAs) powered by state-of-the-art data centers.  The difference here is that Microsoft has a financially backed guarantee which means you will receive a cash refund for anything less than 99.9% based on uptime performance.  The Google Apps guarantee provides for extension of your contract in the event of uptime performance less than 99.9%.

If offline capability is important to you, then you should be aware that Google Apps is almost completely cloud-based so you have to be connected to the Internet in order to use it.  While it is possible to use desktop applications such as Open Office in conjunction with Google Apps, the result can be a confusing user experience.  Users must become adept at switching between two entirely different user interfaces, and IT staff has to support multiple products.  Google is making progress, though, with its recent announcement that Google Apps now supports offline text editing and is working on offline editing capabilities for its spreadsheet and presentation applications.8  With the Office 365 E3 plan, a subscription of Office Professional Plus 2010 desktop version is included which allows users to work with their documents offline with the same familiar user interface. 

Another key difference between the two services is how they deliver new features and changes.  Google releases features and changes to its entire user base at the same time.  This may be a concern for businesses that want to control upgrades for their users and prepare for any potential impact.  With Office 365, Microsoft gives the business owner control over when to upgrade to the latest version so they can make the appropriate preparations.

Conclusion

In this article, we took a look at Cloud-Based Productivity Applications.  There are several drivers that cause businesses to consider moving to the cloud for their productivity application needs and several benefits including increased productivity, lower costs, simplified infrastructure and enterprise level security and reliability.  This article compared how Google Apps and Microsoft Office 365 stack up against each other in the categories of features, security and reliability.  However, each business is unique and will need to weigh the pros and cons of each before determining which cloud solution is the best fit for your business.

 


1 Forrester Study: The Total Economic Impact Of Microsoft Office 365

2 Forrester Study: Measuring the Total Economic Impact of Google Apps

http://www.whymicrosoft.com/en-us/compare-demo/Pages/google-documents-vs-word-web-app.aspx#

4 According to Rajen Sheth, senior product manager for Google Apps. (http://blogs.computerworld.com/16094/google_docs_strategy_be_good_enough_and_better)


 

 

Advisors | Auditors | Consultants | CPAs - Blum Shapiro is one of the premier public accounting firms in the northeast and a Top 100 CPA Firm in the U.S. Our professionals serve businesses, individuals and organizations in Boston (MA), Hartford (CT), Providence (RI), Shelton (CT) and Quincy (MA) with audit, tax and business consulting services. Our firm has developed practice areas in automotive, construction, education, government, healthcare, hospitality, manufacturing, nonprofit organizations and professional service firms. New Haven CT, Fairfield CT,  Norwalk CT, Waterbury CT. 

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