SharePoint Online or Office 365: Should you Choose the Power of One or Many?

For a decade, SharePoint was a standalone collaboration platform. With quite a costly server-based licensing model, it usually served large enterprises enabling employees to handle a variety of collaboration-centric tasks. With the arrival of Office 365, SharePoint On-Premises didn’t disappear, but it lost its dominance because Microsoft started to promote the cloud suite actively.

Today, organizations have the following SharePoint options:

  • SharePoint On-Premises as a server-based solution that exists already in its 7th version (SharePoint 2019)
  • SharePoint Online as a standalone cloud solution
  • SharePoint Online as part of Office 365 or Microsoft 365 cloud collaboration suites

Even if we omit the on-premises deployment model, there are three cloud options for collaboration-targeted companies. So what is better—going with SharePoint Online alone or opting for one of the full collaboration stacks?

A Quick Take on Office 365 and Microsoft 365

Both Office 365 and Microsoft 365 are Microsoft’s SaaS platforms that bring together content management, collaboration, and productivity tools. The platforms provide all of the applications as cloud-based, so once you’ve subscribed, there’s no need for the software to reside on your company’s on-premises servers. With a cloud subscription model, organizations also don’t have to think about patches or upgrades to their deployments as Microsoft handles all the maintenance routine.

In Office 365, you can find the familiar Word, Excel, PowerPoint, and OneNote, as well as OneDrive and many other services. Among them, in different subscription plans, you can find:

  • Outlook for corporate emailing
  • Microsoft Teams for a chat-based collaboration with video-conferencing capabilities
  • Yammer for employees’ social networking
  • Delve for personal profile management and intelligent search
  • Stream, a YouTube-like service for video-based interaction
  • Power BI for data visualization and reporting
  • Sway for interactive and visually engaging reporting, presentations, and enterprise-wide communication
  • SharePoint for organizational communication and team collaboration on fully functional enterprise sites
  • Planner and To-Do both for activity and project management at the individual or team levels. Office 365 can also be extended with Project Online, an advanced project management tool that comes with an additional subscription fee

It also comes with several solutions that help organizations streamline their business processes through forms (Microsoft Forms), workflows (Microsoft Flow), or enterprise-specific apps (Microsoft Power apps).

As for Microsoft 365, it’s very similar to Office 365 in terms of the included apps. The former is to be a comprehensive solution for SMEs, that’s why, in addition to Office 365 apps, it also comes with Windows 10 and Enterprise Mobility and Security.

You can see that both Office 365 and Microsoft 365 represent a set of applications, not a single solution. Each of the included apps covers a specific part of enterprise collaboration. Some of them have similar functions: you can organize presentations both in PowerPoint and in Sway.

The diversity of apps that users can access within a single suite and a subscription-based payment model are attractive for organizations. This explains a continuing increase of Office 365 use: 77% of Office 365 deployments compared to 49% of SharePoint 2013, 34% of SharePoint 2016 and 12% of SharePoint 2019 (according to the 2018 Global SharePoint Survey by Hyperfish).

Office 365 and Microsoft 365 Pitfalls

Indeed, the cloud collaboration suites bring many advantages. However, they also come with challenges, which can hinder the overall success of their adoption.

1. It’s hard to switch to reasonable customizations

As it was mentioned, Microsoft owns Office 365, so the corporation takes care of all the suite’s modifications and updates. This can become a problem for companies that got used to server-hosted solutions that they can customize as they want.

Like it or not, updates will come to the suite, and you won’t be able to ignore them. As for your own customizations, they can conflict with Microsoft’s rules, so you can be unable to deploy them, or they might affect your solution’s performance badly. Microsoft recommends sticking to moderate customizations within the cloud suite and avoiding any sophisticated tuning to preserve Office 365 integrity and smooth operation.

2. It’s easy to get overwhelmed with apps

Adoption issues often accompany Office 365. It can start with an organization’s superficial understanding of the suite’s logic and lead to its incorrect management and use. Overwhelmed with a whole bunch of collaboration apps, users can be confused about optimal use scenarios for each of them, while the solution itself risks transforming into a messy collaboration junkyard.

3. It’s challenging to implement the Office 365-centric culture

When Office 365 comes to enterprises’ lives, it covers an important part of everyday activities. In smaller enterprises, Microsoft 365 can penetrate all business processes, which requires proper mindset.

Companies should not only implement the technology itself and ensure its high performance, but also ensure that all teams and particular specialists understand well how to leverage each collaboration app and how to switch from scattered tools to the centralized platform smoothly.

So Can You Go for SharePoint Online Alone?

While all the tools in the Office 365 platform aim at enhancing teamwork, SharePoint comes as the epitome of collaboration. It lets businesses build centralized enterprise portals, or intranets, where teams can share and exchange information between their members and extend this collaboration to ideas and projects, not just files.

Launched as a cloud replica of SharePoint On-Premises, SharePoint Online got an impressive development spur and has already outstripped its server-based predecessor. Today, in addition to traditional team sites, SharePoint Online offers communication and hub sites, which enables its owners to create even more diversified corporate portals with improved structure.

In the cloud reality, SharePoint goes hand in hand with OneDrive for Business. It should be said that there is frequent confusion between two apps, specifically as they both deal with files. However, in contrast with SharePoint, OneDrive for Business may seem lopsided. The latter doesn’t provide intranet capabilities and serves as a file storage mostly. Smaller businesses can use OneDrive alone for their business content management if they don’t need any sophisticated collaboration features that SharePoint offers.

All in all, SharePoint and OneDrive come together in both SharePoint Online plans, for $5 and $10 respectively. That’s why it might be reasonable for a company to get a combo of two powerful apps instead of subscribing for OneDrive only. Particularly, if we take into consideration that the price of OneDrive standalone is similar to the price of the SharePoint Online + OneDrive package.

Coming back to the SharePoint vs. Office 365 dilemma, organizations can think that opting for a full Office 365 package is always better than staying with SharePoint alone. However, there are several cases when it’s logical to choose a pure SharePoint subscription.

  • You want to move your intranet to the cloud

If your organization was using a server-based SharePoint intranet for years and now wants to have it in the cloud, moving it to SharePoint Online will be just fine. You can continue using a familiar intranet in SharePoint Online while getting access to a broader set of SharePoint features.

  • You don’t face an urgent need in more extensive collaboration capabilities

When organizations decide to implement the entire Office 365 suite, there is a great challenge for them to adopt all the applications at once. Moreover, some organizations feel ok without a collaboration diversity. If there is no need in using multiple collaboration tools, it’s reasonable to stay with SharePoint Online and save both time and investment required to adopt the full suite.

  • You have never had a centralized collaboration app before

Many businesses live without any specialized collaboration software at all. In this case, it’s ok to start with a single app instead of jumping into the Office 365 collaboration pool without knowing how to swim. SharePoint standalone can be much easier to adopt and simpler to use than a bunch of collaboration apps. Finally, it’s just cheaper than a full Office 365 subscription.

How Do You Choose?

Both smaller businesses with a limited budget for their internal collaboration tools and large enterprises that look for an optimal solution can compare SharePoint Online with the full Office 365 package. Going for SharePoint consulting is a right way for you to find the right option. You can still use the points described above as a starting point of your final decision.

Overall, choosing between SharePoint Online and Office 365 comes down to your organization’s collaborative requirements. If you only need an intranet-centric collaboration, going for pure SharePoint Online is the option. For this, SharePoint Online Plan 1 or 2 will work nicely. If you have many distributed teams and real-time collaboration is critical for them, you may want to get access to the entire breadth of tools for teamwork productivity. These come within Office 365 or Microsoft 365 packages, with varying selections of applications for small, mid-sized, and large enterprises.

Sandra Lupanova

Sandra Lupanova

Sandra is SharePoint and Office 365 Evangelist at Itransition, a software development and IT consulting company headquartered in Denver. Sandra focuses on the SharePoint and Office 365 capabilities, challenges that companies face while adopting these platforms, as well as shares practical tips on how to improve SharePoint and Office 365 deployments and take maximum benefit out of them.

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