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Google enterprise apps gaining, but as supplements -- not substitutes

Millions of users have signed up for Google enterprise apps. For many, the cloud platform is still a supplement, not a substitute, for legacy systems.

They're cheap. They're accessible from any device with a browser (except when they're not). The federal government put its stamp of approval on them this summer, the Department of the Interior's preference for Microsoft notwithstanding. Big companies like Motorola Mobility Inc. moved to Google Apps, presumably before they knew they were moving in with Google Inc. Heck, 61 of the top 100 universities in the U.S. News and World Report's latest rankings have gone Google, as Google trumpeted this week on its Enterprise Blog.

Four million businesses use Google enterprise apps, an increase from 3 million a year ago. And the pace is quickening: According to the company, 5,000 businesses sign up for Google Apps every day. Google staffing in this area is growing just as quickly. Its enterprise apps team has more than 1,000 employees today, double the number of employees just 18 months ago, a Google spokesperson confirmed.

But are Google enterprise apps about to hit it big in the enterprise? Not tomorrow, said analysts who follow the company's determined pursuit of the business market. At midsized to large companies that have taken the plunge, these apps still supplement rather than substitute for the ubiquitous Microsoft Office apps, and typically are deployed to discrete workgroups rather than company-wide. However, Google increasingly makes the short list right alongside Microsoft and IBM at enterprises looking to upgrade their messaging and collaboration platforms, these analysts hasten to add. Unlike a few years ago, the interest goes beyond a move to Gmail.

"Nobody is looking at Google as an email replacement because they are unhappy with their existing email," said Ted Schadler, principal analyst at Forrester Research Inc. and co-author of Empowered: Unleash Your Employees, Energize Your Customers, and Transform Your Business. "They are all looking at Google as an important transition to a [Software as a Service] SaaS-based delivery platform that offers a significant difference and benefits to how people get stuff and how they are supported from wherever they work. It's never just one decision."

Executive push for going Google

There are a number of reasons why companies are looking at Google or any SaaS collaboration platform, but a growing mobile workforce and the need for IT systems to support rapid business change are two big factors, Schadler said. Often IT is running an older version of Microsoft or Lotus messaging and collaboration software, and is looking to upgrade. "Google is not on the short list initially but it goes on the short list once the questions are asked," he said. CIOs --or even CEOs and boards of directors -- are doing the pushing, more so than IT staffers, Forrester has found. And, yes, cost is the real attention-grabber once it is determined that a SaaS product can work. "It doesn't look or feel or behave like the premises-based solutions of yesteryear, and some people hate it, but it is really cheap," he added.

That was more or less how things shook out at Lincoln Property Co., said CIO Jay Kenney about the Dallas-based management company's switching in 2010 from an in-house Novell GroupWise email system to Google Apps for its 4,000 employees. The move to a SaaS platform was in keeping with his IT strategy to outsource applications and infrastructure management wherever possible, but Google Apps was not the frontrunner. "Google Apps was kind of just thrown in there as part of the business case. The leading contender was either insourcing or outsourcing Exchange," he said. That business case turned out to be compelling: "It was a lot cheaper than anything else out there," he added. "Change management was really the difficult piece -- getting the users across the company comfortable with the new system."

Who doesn't need Google Apps?

CIOs can't afford not to look at the Google option, said Whit Andrews, lead analyst for Google at Gartner Inc. "Google Apps continues to grow in organizations, because it is a good-enough solution for email and documents for lots of people," he said.

It's important to define good enough. Google enterprise apps make less sense for employees who need access to a lot of legacy apps within the Office family. In addition they aren't suitable for companies that have built a lot of critical business process management, or BPM, applications on Office, and to heavy SharePoint shops, Andrews said.

Also not suited to cloud-based messaging and collaboration are global companies that need to know where data is at rest, companies with no experience with cloud infrastructures and companies without reliable bandwidth in many locations, Forrester's Schadler said.

Google Apps continues to grow in organizations, because it is a good-enough solution for email and documents for lots of people.

Whit Andrews, lead analyst for Google, Gartner Inc.

As for the "rip and replace, we're going to move everybody over to this" attitude -- that is not happening, analysts agreed. "Google Apps is far more often used as a supplement than as a substitute," Andrews said. In fact, such wholesale moves are rarely the case for IT systems. "It's not like people are going to go throw out Microsoft Office and be done with it, any more than my photos today are only stored on Flickr and not on a hard drive."

The move to Google Apps starts off as a "pure cost play" for most companies, agreed Jason Lee, partner at MavenWave Partners LLC, a Chicago-based consultancy (and Google partner) that advises organizations moving to the cloud. He agrees with Forrester's Schadler, however, that the first decision companies must think through is whether they want to stick with software that's premises-based or move to a non-premises solution.

That was the case with MavenWave client Journal Communications Inc., a Milwaukee-based media company. It was approaching the renewal of its enterprise agreement with Microsoft, and its far-flung and separate IT infrastructures included 17 implementations and multiple versions of Microsoft Exchange. A new CIO, Michael O'Brien, had been brought on board to "drive change," Lee said.

Previously a CIO at a startup, O'Brien is steeped in cloud computing. His goal is to put as many of Journal Communications' operations as possible into the cloud. So, despite the company's Microsoft contract, he spearheaded the case for moving to Google Apps. Until 2012, when all 27,000 employees will have been rolled over to Google Apps, the organization is anchored by "hundreds of servers surrounding MS Exchange and SharePoint, and they just need to go away," O'Brien related in a recent blog post. "We realize this is a significant business change, but even some people who were originally skeptical are getting on board."

MavenWave's Lee, who essentially has bet the house on many companies' seeing things O'Brien's way, is convinced that deciding to go Google is not the hard part for companies inclined to cloud computing. "It shouldn't take a lot of conversation for CIOs to realize that these core collaborative technologies are probably not the best place to invest IT assets internally," he said.

The challenge is managing that significant business change to which O'Brien and Lincoln Property's Kenney allude, and having the foresight to fund the conversion to Google enterprise apps. In a related TotalCIO Blog post, MavenWave's Lee offers a three-step framework for rolling out Google's apps.

Let us know what you think about the story; email Linda Tucci, Senior News Writer.

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