Mozilla's Thunderbird is another very robust desktop client -- and, unlike Outlook, it can be used on Windows, OS X, and Linux. Thunderbird offers much of the same messaging functionality as Outlook and even Gmail, but for anything beyond that, there's a caveat: some tools must be added to a Thunderbird installation. For calendaring, for instance, users need to use either Lightning or Sunbird. The cost of Thunderbird -- free -- makes it very attractive, so it's a good option for home or small business users that access their messages from just a few set locations.
Enterprise users are probably going to be more comfortable with an in-house messaging solution, which means some form of non-cloud client/server arrangement. Home users, however, will be very well served by Gmail, especially if they expect any kind of mobility when accessing messages.
In the old days, this would be easy: Microsoft Office. That's because no matter what tools were out there competing with any of the Office applications, it really all came down to file compatibility. Businesses, schools, and home users exclusively saved documents in .doc, .xls, or .ppt format, and so you would too, by golly.
But now the Open Document Format (ODF) is available, and even Office uses it, if somewhat begrudgingly; as a result, compatibility has become less of an issue when sharing files with others. It's not perfect yet, but it's definitely better. With that in mind, is Office still the better option?
In word processing, you might not want to go with Word. Creating documents is, honestly, not something you need a lot of bells and whistles to accomplish. OpenOffice.org (or LibreOffice) Writer has much of the same functionality as Word, and is available on multiple platforms. Google Docs is extremely limited in terms of word processing capabilities; its best feature is real-time collaboration. Writer is the best word processor for the right price: free.
Spreadsheets are another matter. Between Excel and Calc on the desktop, and Google Docs on the cloud, it's clear that Excel is still the champ in this category. With more functions, better analytical tools, and easier charting, none of the other spreadsheet apps come close.