Small Biz Tip: Install Windows 7, Save $500

REDMOND, Wash. (TheStreet) -- Microsoft's (Stock Quote: MSFT) Windows XP operating system will soon go the way of buffalo. Worry not, though, we're going to tell you how to install your new software.

In case you haven't been keeping up with the news, the software giant is adopting a take-no-prisoners attitude toward the rollout of its latest operating system, Windows 7, which can be pre-ordered. It features better search tools and improved performance for easier networking. Microsoft's new software is meant to take on competing systems by Apple (Stock Quote: AAPL), Red Hat (Stock Quote: RHT) and Google (Stock Quote: GOOG), which have been encroaching on the company's turf.

Sure, you could buy new computers for your office with Windows 7 already installed, but that's not the sensible way to deploy this technology. I recommend saving $500 by upgrading your PCs yourself.

Earlier this week, I told you how to prepare for the installation by removing unused programs and backing up your data using cheap, portable hard drives and free Web-based accounts. Now it's time to upload Windows 7.

Step 1. Back up your data.

First tip: DO NOT use Windows' back-up tools.

Microsoft sets the standard for uselessness in data recovery. But fear not, storage options from companies like Western Digital and Toshiba usually come with software that lets you back up your data with one click. Just make sure you're backing up the right data, and then let the thing run.

Now, you should locate your program discs for Microsoft Office and other software you use. (I assume you're running legal copies of your software, right?)

Step 2: Learn to read the IMAP.

Now that you're all backed up, you have plenty of time to do what you should have done a long time ago: Start using Web-based office and collaboration software.

Online office-software providers like Google or Zoho make configuring your desktop e-mail systems easy. The secret is not to use a so-called POP e-mail account. Instead, run your business's e-mail via IMAP, or "Internet Message Access Protocol." IMAP e-mail automatically syncs your messages to all the devices that use your email account.