POP3

The Post Office Protocol version 3, or POP3, is the newest iteration of a protocol—or set of software rules—that allows a user to receive email from the Internet. The basic functionality is such that a server receives and holds an email message that waits for a client computer to connect and download the message to a mail-reading application.

This protocol is implemented in all of the most popular and widely used email clients, such as Eudora and Microsoft Outlook Express. Increasingly, web-based email services also allow POP3 client applications to access the remotely resident email and view it in the application window as if it were standard email.

One drawback of POP3 is that it is designed to delete email on the server after the user has downloaded the information. With limitations, this can be delayed, but it is a part of the POP3.

An alternative to this is the IMAP, which affords users more flexibility in storage or deletion of electronic mail.

SMTP

SMTP stands for "simple mail transfer protocol" and is the standard for sending emails through the Internet.

SMTP is a relatively simple piece of text-based code in which recipients of an email are specified. That email is sent from a client computer to a server, and then sent on to the recipient. An SMTP client can be found in either the server or the receiving system.

According to Wikipedia's article on SMTP, various forms of electronic messaging were in use as early as the 1960s, but as the government network expanded, it became necessary to employ a new method of emailing between systems on the ARPANET. This gave birth to the first multi-system Internet email protocol.

Email Terminology

Email

The Business Encyclopedia states that email is "a method of communicating whereby an individual uses a computer or other electronic device to compose and send a message to another individual." These messages are often sent through computer systems that are linked through networks, from one system to another, using a modem and connected telephone lines, and often through a wireless transmission method.

Email has become a generic term for all electronic messaging from computer to computer, but real email is specific to an application which was deployed on the original Internet in 1971.

The Revolution of Email

The essential nature of electronic mail cannot possibly be overstated. It has proven to be an absolute revolution in the paradigm of business communication, and as such, it deserves special attention when determining whether it qualifies as a business process that can be outsourced.

To appreciate email and fully understand the discussion of email outsourcing in this book, what follows is a small glossary and basic summary of email, where it came from, and how it works.

This is not simply an academic background discussion. Understanding the intricacies of email's functionality will allow you to understand the burden of email maintenance on your IT staff when performed in-house, and potential areas of trouble if the process were to be outsourced.

Benefits and Headaches of Outsourcing

With all of this complexity, a business must not make assumptions about an outsourcing contract. While outsourcing can save a great deal of money, it can also create headaches if the process is mismanaged or if a reliable and trustworthy company wasn't employed from the start. Businesses often tend to underestimate the potential costs of outsourcing, as well as the potential problems that can arise from shipping an essential business process overseas.

While reading this guide to outsourcing your email, as a responsible business owner, you will need to consider several things before committing to an outsourcing contract. Your business will have to honestly evaluate its needs as well as the driving motivation for the move to outsourcing. Will the cost savings be worth the newfound distance you will have from a process that was previously in-house? What brought on the interest in process outsourcing? Was it financial, or something more? Before any decisions are made, be sure to assess and quantify what life without the in-house email process will be like.

Do not rush into a decision to outsource, and even after your company has committed to that path, spend the time that will be necessary to find a service provider that will meet your needs and expectations. A good working relationship will come from the trust you will have in knowing that the contractor or service provider you are working with is the best one to take over your email, or any business process which is essential to the operation of your company.

Outsourcing Made Simple

The term "outsourcing" is derived from "business process outsourcing", which has become increasingly popular (if controversial) in the last ten years. It is similar to contracting, though it is generally more complex and involves a separate business entity that is contracted to perform a particular business process rather than a single project. This business process is usually undertaken at a remote location, rather than on-site, and depending on the process, can be anywhere in the world.

Outsourcing is a simple concept and can be applied to a wide range of business functions and processes. It is common for outsourcing to be undertaken in the realm of software development or design, manufacturing, or production, but increasingly companies are choosing to outsource human resources and accounting processes, which are functions that have traditionally been performed in-house.

In certain extreme cases, some companies have acted only as management entities, while all aspects of the business workflow are outsourced to companies around the corner or around the world. These "management façades" can be little more than an office and a computer.

Outsourcing is clearly having a major effect on the traditional business model. The reason for this, quite simply, is cost savings and efficiency. With this said, however, one should be aware of the complexity of outsourcing in modern business.

Two more terms to know are "offshoring" and "multishoring" which are forms of outsourcing. Offshoring is the process of moving the functions of a business (or in some instances, the business itself) to a foreign location. This is a common element of outsourcing, as many outsourcing companies in certain business sectors are located in China or India.

A complicating element of outsourcing, and certainly one that one should be aware of in regard to outsourcing a potentially sensitive business process such as email, is multishoring. Multishoring is outsourcing of a project by an outsourcing company, creating a buffer between the originating business and the company actually doing the work. This is prevalent in manufacturing, though it is increasingly relevant to information technology and the outsourcing of digital business functions.

One example of this might find a U.S. company outsourcing a business function to a firm in India. The outsourcing company in India might find that it is cheaper to outsource that function to a firm in Vietnam, where the U.S. dollar is even stronger, then collect the difference for having done little more than broker a process outsource between two companies who otherwise would never have worked together.

Outsourcing and Contracting

An increasingly popular model for businesses is outsourcing and contracting. These methods of production and productivity have definite benefits, and before moving into a discussion of the specifics of a particular kind of outsourcing (the outsourcing of corporate email), a more general discussion of the cost savings of outsourcing and contracting may prove to be helpful in your eventual decision on utilizing these business models.

Contractors

Using contractors and outsourcing business processes can save a great deal of money for your business. Contractors are temporary workers who complete a task and are often paid per-project. Businesses are not responsible for any of the normal benefits associated with permanent employees, and so contractors can save money while also reducing paperwork.

Contractors are also the right choice to complete short, discrete projects which are non-recurring. As an example, let’s say that you need a grant to be written and none of your current employees have the necessary skills in grant writing or the grant application process. Hiring an employee for a single job would be inefficient and unfair to the prospective employee. Bringing in a new person to your company requires a huge investment, as any business owner knows. Additionally, a rising cost in many businesses is in benefits: the healthcare costs and 401Ks that are due to a full-time employee can represent a substantial yearly sum.

This is exactly the sort of job that is suited to a contractor. When a business hires a freelancer, the hiring is based on a specific skill and an understanding that the job will be limited to a single project. A one-time fee is negotiated and once the project is completed, there is no further obligation. With this said, however, businesses often find themselves hiring the same contractors repeatedly because of high-quality work. Building a relationship like this will benefit your company, and you still won’t have to pay for pension, insurance or other benefits.

Don't Forget to Budget!

A budget shouldn't just be a suggested spending plan—it should be a viable road map for the company's fiscal future. It may seem like a simple and obvious step, but it's surprising how many businesses fail to write and maintain a budget each year. A budget can give a company a sense of what can be spent and in what ways. This will help to gauge in which areas risks can be taken, and which areas can benefit from investment.

A budget isn't just a financial plan; it's also a functional visualization of a company's internal behavior. A budget can illuminate disproportionate costs in office supplies, overtime, or any other element of the day-to-day operation that is too easily folded into the assumptions about expenses during the year.

Paperless Efficiency

Going paperless is part of a "green" office, but can have an even greater impact on efficiency. By eliminating paper from the office, supply costs and storage space can be significantly reduced. Instead of file folders and cabinets, electronic backups in multiple forms can eliminate the need for storage and decrease the amount of time it takes to retrieve archived documents. No more wading through the recesses of the document archive.

Another part of reducing paper consumption is to shift your office communication paradigm to email and electronic messaging. There isn't much point in printing documents for intra-office use when these same documents can be attached to emails and the paper and ink saved for an occasion when a hard copy is actually necessary.

For many, the idea of shifting to a paperless office is unfamiliar and possibly a little scary, but with more businesses finding the multiplicity of benefits with this strategy, it seems that the paperless office is an inevitable part of the future of business. Get on the bandwagon early and reap the benefits of good PR and reduced expense.

Going Paperless- Going Green

Become an environmentally-friendly business. It’s one of the easiest and most beneficial ways to cut costs, particularly as it will boost the company image while saving money at the same time.

Essentially, the goal is to try to eliminate waste from the office space. Print documents only when it’s necessary. Use recycled printer cartridges. Even better, use refill kits to make the most of your current cartridges. Use energy-efficient light bulbs and products that meet Energy Star specifications, as determined by the U.S. Department of Energy and the U.S. Environmental Protection Agency. These products can save you money by using up to 30-75% less electricity than other office equipment.

All of these items can be cheaper over the lifetime of your business than standard alternatives and make enormous strides in preserving the environment. As a company, you want to save money, but just think of the greater impact implementing these strategies will have.

Cutting Service Costs

Another common area in which business seek to cut costs are services. Your business may not need a lawyer year-round, but without a legal professional on retainer, a lawsuit or other litigation will suddenly present a much more damaging cost. Maintaining services, even though they might not seem essential, is a calculation that all businesses must make as they seek to streamline and increase efficiency.

This discussion has a direct bearing on the matter of email outsourcing, because it, too, will require an honest assessment of the potential impacts—both positive and negative.

Sometimes the smallest cost-cutting measures can have the biggest effect. Freeing up funds to invest in new projects or infrastructure development can make a big difference when the time comes to commit to an outsourcing plan. Here are a few suggestions for reducing costs...and your business can start tomorrow.

Reducing Overhead

When it comes to cutting corporate expenses, one of the first places the savvy budget analyst will look is the infrastructure of the company. Is there anything that can be cut from the program? Are there any positions that are unnecessary? Essentially, the analysts come in and make sure the business is running at its full capacity and is using as few resources as possible. In business, efficiency is absolutely essential to success.

In the drive to efficiency, however, experts and advisors can often do damage while trying to streamline a business. The impact may be of a nonspecific, qualitative kind, or may present itself in a very real and immediately damaging way. As an example, downsizing staff or eliminating production workers may be a tempting cost-cutting measure, but the remaining workload will have to be distributed among the remaining employees. Creating redundancies based on truly inefficient job descriptions can be beneficial to a company, but if the lack of staff places a new and difficult burden on the remaining staff, the overall effect of the cost-saving measure will be a lack of productivity. There may also prove to be a chilling effect on the remaining staff, creating a drag on morale and team spirit and dynamic. This less specific or quantifiable effect should always be part of a downsizing calculation.

Equipment Operating Costs

Equipment costs are those expenses which must be incurred simply by the operating of the company. Without the operating equipment, the company would cease to function and cease to be profitable in any way.

Examples of such operating costs are not limited to manufacturing. Equipment may refer to any mechanism of the running of a business.

• Salaries or Wages
• Advertising and Marketing
• Raw materials (this is an incremental cost)
• License or Registration fees
• Real estate expenses (Rent, property tax)
• Fuel
• Public Utilities
• Maintenance
• Office supplies and consumable products
• Insurance
• Depreciation of equipment and eventual replacement costs (unless the facility has no moving parts it probably will wear out eventually)
• Damage and Replacement
• Taxes on production or operation
• Income taxes

Many of these costs will be fixed, and to a degree, even some of the variable overhead cost is difficult to manipulate or reduce. When any of these costs relate to a company's human capital, then the reduction of costs takes on a new and even more difficult dimension.

There are some areas in which overhead can't be easily, efficiently, or effectively reduced. But for each of these troublesome costs, there are many more that can be reduced or completely eliminated.

In the next section, some simple methods of overhead reduction will be discussed, as well as those that have the most to do with the eventual goal of reducing costs in the realm of electronic communications and IT—contracting and outsourcing.

Business Operating Costs

Commercial enterprises can be said to generally have two separate divisions of overhead cost. These are fixed and variable costs. The difference between these types of costs is essential to understanding what can and what cannot be reduced in the event that a company seeks to aggressively cut overhead.

Fixed Cost

Fixed costs are expenses that will exist independent of production or productivity. Fixed costs will be the same whether a manufacturing facility is operating at peak capacity, or closed and locked on Christmas day. These can include taxes, rent, monthly fees for telephone or internet, or any cost which will be incurred whether the company is open or closed.

Variable Cost

These are costs which fluctuate depending on the productivity of the business. In manufacturing, an example of a variable cost will be the electricity used to power the facility. During a slow, or less productive month, electrical usage will be lower, but so will profitability. Additionally, the cost of power can vary depending on the cost-per-unit of power.

Overtime is another variable cost that changes from one month to the next. Authorized overtime can cost a company significantly, but if that overtime is well used and contributes to better productivity, then the overtime in a cost/benefit analysis will actually prove to be cost saving.

The Cost of Doing Business

An Introduction to Overhead and Ways to Reduce it

Overhead (also known as business process overhead or simply as operating cost) is the recurring expense which is related to the operation of a business. This comes in several forms, each instance of which can be reduced or even eliminated, but always at a cost to the production or services provided by the company. The manipulation of the overhead variable will necessarily demand a cost/benefit analysis before the change is implemented.

This is no different for the particular reduction in overhead which is discussed in this book, but to have a better sense of which costs can easily be reduced and which can rarely be reduced, a discussion of the categories and examples of overhead follows.

Elements of a Corporation

Some elements of a company's operation are essential and intractable. Electricity for production, fuel for transportation, office or manufacturing space—while each of these costs are elastic and can be negotiated or manipulated, they will remain costs at some level for the life of the business.

Communication is another such cost. Telephones, internet connectivity, and electronic mail are essential components of a business entity in the 21st century. But like the other costs, these can be reduced significantly with a little planning and a small investment in the future of the company.

The reduction of your communication costs, and email costs specifically, can be achieved without sacrificing quality, reliability, or functionality. It might even be surprising to know that with a reduction in cost through the methods outlined in this book, you may find an overall increase in quality, reliability, and particularly in functionality.

The primary goal is not simply to save money, but to do so in a way that benefits the company in the long term, with minimal or no negative impact on overall quality of service or product. With that in mind, this book is designed to create a viable plan for businesses to transfer the care and maintenance of their electronic communications over to a service specifically designed to maintain such corporate email infrastructure.

Introduction to Outsourcing Your Corporate Email

Business Management 101: The management and operation of a large company is not a trivial task. The maintenance of the daily operations of such a company can result in huge overhead that cuts into profits. A cut in profits results in a lack of growth, stagnation, and eventual failure of a corporate entity.

As foreign competitors in India and China gear up for business in the 21st century, American companies must look for increasingly creative (and effective) methods of cutting back overhead and increasing profit margins so that they may be competitive in a new, globalized economy.

Cutbacks come in many forms. Some look good on paper, but can be lethal to a company's sense of employee morale, or might be severely damaging to a public relations image, which was undoubtedly costly to develop in the first place. Some cutbacks and cost-saving measures have big qualitative impact but very little quantitative impact—and in a world where bottom line is king, it's the quantitative impact that companies should focus on.