Hi Dana,
Based on the screenshot, I noticed the “Use SSL to connect (recommended)” is checked under “Outgoing server”. Actually, in Office 365, this part should be “TLS” instead of “SSL”.
In addition, to get the best experience, it’s suggested that customers connect the Office 365 account to Outlook with the Exchange connection. If the issue persists after changing authentication setting as I said above, could you configure Outlook with your Office 365 account via Exchange to see if there is the same problem?
In addition, here is a link about how to set up emails through Exchange in Outlook 2011 for your reference: Set up Outlook for Mac 2011 (If you are using the recently released Outlook for Mac, the steps are similar). And if you encounter any problems while configuring the connection, please feel free to let me know.
Thanks,
David
