Outlook was probably configured for Internet Mail Only mode. You will need to switch to Corporate or Workgroup in order to use exchange.
From the Tools menu, select Options. Under the Mail Services or Mail Delivery button or tab, click Reconfigure Mail Support. Beneath "E-mail Service Options", select the mail support option to which you are switching. Click Next. Read the warning message and then click Yes. Outlook will close. Restart Outlook. The Windows Installer will open and install the required files.
Let us know how it goes.
A computer lets you make more mistakes faster than any invention in human history - with the possible exceptions of handguns and tequila.-Mitch Ratcliffe
The most likely way for the world to be destroyed, most experts agree, is by accident. That's where we come in; we're computer professionals. We cause accidents.-Nathaniel Borenstein