Switching over to Google Apps for domains does have many strong points, but there are some things to consider before proceeding.
Being able to use the Gmail interface in Google Applications, compared to outlook, is a breath of fresh air. Receiving a flood of email and using Outlook for email management can be very slow at times and that's counter productive. Some people may enjoy that morning break, but it drives me nuts. Having an exchange server does nothing to speed thing up searching or rules processing if all your mail is local. Gmail was designed to excel with speed, especially with searching, which it does very well.
Now, from a management perspective, our mail server still exists, but is simply a smtp relay to Gmail. All of the real mail server "guts" now sit on Google's infrastructure and is managed by Google Engineers for about $50 per person, per year. That is very valuable to our organization.
Having docs in the cloud is not new for me since I've been using Gmail and Google Docs for many years. I use the collaborative features in Google Docs to "work in tandem" with others to complete a project task or write a document. I especially like to attach an analytics id to certain, high-visibility documents to monitor the activity. The work turns into a fun exercise to experience this collaborative feeling in action. Trying this with a Microsoft product will only leave you with an error - file locked by john doe.
Using Google Docs Forms is handy for gathering poll data or working collaboratively for entering data. If you have organized or migrated a website before, then you can respect the the cleanliness and organization of content as you move it around or set it up. You can also enable your customer to assist with the data entry using Google Docs Forms.
Having an integrated chat tool, like Google Chat embedded in the Gmail interface, makes it real easy for employees to communicate. The chats, by default, are stored in Gmail search history, so they can be retrieved just like an email. Some of our employees extend the chat to their cell phones, so they can stay in touch even when they are away from the office. Mail and calendar can also be extended for mobile devices.
They even have Google Groups, for discussions, Google Sites, for simple website generation, and Google Video, for hosted video. These features have not been used for anything production, yet.
Things I really like about Google Apps. It's under the Google.com domain and not Gmail.com, so you can be logged in to both at the same time. Sure, you could connect the accounts too, but I keep mine separate because I can. For people who have used Gmail, they know the spam filtering is the best. Plus, it's fast, about 90% (disappointed - more about this later) of the time. My calendar is now so flexible I can view and update it using many mail programs on mac or pc. I can add my personal calendar and view and update it in the same space. I can schedule a meeting and see everyone's schedule, just like exchange. It shows meeting room schedules too. It's very mature and well done. Not once has Google Calendar been slow. Google provided a team of people to assist us in the migration doing much of the account leg work. We were also able to migrate all our old email from Microsoft PST files to Gmail. They have a team of people monitoring our email and their system. New features are rolled out and upgrades are made without my team being concerned about it. Most of all, they give you a phone number to call when you have an issue.
Things I don't like about Google Apps. Depending on the size of your organization, it can take some time setting it up, but Google does offer a team of people to help. They did, at least, we when migrated in late 2009. If all your requirements are not met, you may need to find permanent replacements since the Google Apps platform is new, and somewhat, limited. Heavy Outlook uses who have many folders and rules, will have to rebuild everything in gmail. Is that the fault of Google or Microsoft? In all fairness, there is no easy way to export this form Outlook so importing is out-of-the-question. The only slowdown occurs when Gmail can get slow about 10% the time, which happens about 90% of the time when sending new mail. Setting up Google Apps can be different for mac users vs pc users, so have a plan for both if you support them. Overall, I have few complaints and the team is energized with the new features and options of this cloud based service.