Demystifying Microsoft Copilot: Your AI Companion for Everyday Work

AI is rapidly evolving, and Microsoft Copilot has emerged as one of the most powerful new sets of tools available to modern workplaces. With that pace of change, I’m hearing many questions about AI from the business leaders I speak to, such as:

• What is Copilot, exactly?
• Why are there so many different Microsoft products called “Copilot”?
• How do we choose the right one for our needs today?

In this article, I’ll walk through everything you need to understand Copilot clearly and practically. You’ll learn how Microsoft structures its Copilot family, what Copilot and Agents actually do, how Copilot compares to other AI tools, and how Encore helps organizations identify high‑value AI opportunities through a practical, low‑risk approach.

You can also watch a presentation where I cover most of the same information:

Copilot Is Not a Single Product — It’s a Brand Family

Although it often operates like a single application, Copilot actually encompasses over a dozen different Copilot experiences or products that Microsoft has available. To get a handle on this complexity, we can break these down into three major categories:

1. In‑Product Copilots

These are embedded directly into apps you already use, and they usually have the word “in” within the product name.

• Copilot in Excel
• Copilot in Power BI
• Copilot in Teams
• Copilot in Business Central
• Copilot in Dynamics 365 Sales

Depending on the app, these may be included with your app license. For example, Copilot in Business Central is included with your Business Central license. Copilot in Sales, you get along with a sales license if you’re using Dynamics 365 Sales.

2. Product Extensions

These provide extended features for specific Dynamics applications, and they tend to have “for” in their name:

• D365 Copilot for Sales
• D365 Copilot for Service
• D365 Copilot for Finance

These typically require additional costs, licensed as a sort of extension to the core functionality that you get with each of those D365 licenses.

3. Named Copilot Products

These are the standalone products that Microsoft specifically markets.

• Microsoft 365 Copilot
• Security Copilot
• GitHub Copilot
• Copilot Studio

Most of those are going to be paid licenses. There is also Microsoft 365 Copilot Chat, which is the free version that gives you some access into the AI world.

Starting with this overview of the 3 categories helps organizations understand which Copilot capabilities they already own — and which ones you may want to adopt next.

Every Employee Has a Copilot. Every Business Process Has an Agent.

An additional layer of detail comes in the distinction between Copilot and Microsoft’s Agents.

One of the biggest themes from Microsoft’s vision for AI is this:

• Copilot = personal assistant for every employee.
• Agents = automation layer to transform every business process.

Copilot helps to inform and inspire individual employees with advice, feedback, and answers. Its functionality stretches from the simple (chat, query, find information) to the more advanced (create or generate). Think of Copilot as a one‑to‑one relationship: each employee has a Copilot, grounded in their work.

Agents, on the other hand, carry out business processes, working alongside or on behalf of the individual employee, a team, or the whole organization. You can think of these Agents in 3 levels of complexity:

1. Retrieval — Bring back information, based on rules and instructions.

2. Task — Execute steps in workflows based on knowledge and rules.

3. Autonomous — Operate with increasing independence, planning steps and learning over time.

Those autonomous agents dynamically plan and learn from the process, so they can advance without human interaction and adapt to changing conditions.

At this point in time, for the most part, we incrementally roll out that type of functionality, and we are likely to continue to have that human interaction for quite some time before we allow those agents to go truly autonomous.

Copilot Is Becoming the UI for AI

Another way of looking at Copilot from a user’s perspective is that it’s really the organizing layer for individuals to interact with — not just agents, but all of the large language models that are out there. Microsoft’s vision of Copilot is for it to be the interface, so to speak, for AI.

Copilot is becoming:

• The organizing layer for human interaction with AI.
• A unified interface across Microsoft 365, Dynamics, and beyond.
• The gateway to all business systems.

The vision is ultimately that every employee would have a Copilot that knows them, knows their work, and largely frees them from the drudgery of repetitive work to unlock productivity and save time.

Copilot Studio

One other thing to note is that, among those named products from Microsoft, Copilot Studio really has a special place. It enables you to build Agents and automations. So, Copilot Studio can give us a lot of individualized organizational flexibility.

Copilot Studio even has the ability to look at other AI engines that are not from Microsoft in order to collect different options for outputs. That’s not often talked about, but is a really interesting way of sort of hedging bets or balancing your outputs when it comes to what AI is producing.

Throughout the entire ecosystem, IT has control and monitoring abilities to manage, secure, measure the impact of the usage of the Agents and what they are up to, and as well as what the users are doing in terms of AI.

Transforming Your Organization Across the AI Spectrum

Microsoft describes three layers of AI adoption:

1. 1. AI‑Powered Productivity
      Using Microsoft 365 Copilot and Copilot Chat to accelerate individual work. This is the general chat-based AI, which probably most organizations are using at some point, or most individuals are using already within their businesses.
   2. Business Process Automation
      Using pre‑built agents and Copilot Studio on top of the basic chat-based AI to automate workflows across the organization.
   3. Deep Customization & Advanced AI for Commercial AI Applications
      Typically on those fronts, you start with some deep technical coding and development tools like GitHub or Visual Studio, and then you incorporate Azure AI Foundry as well as Fabric. Microsoft Graph also plays in at some point into that last layer, which is really a tailored solution to be able to point AI and Copilot to other competitive AI products. It’s really in that development arena that you have that ability to perform that type of function.

Pre‑Built Agents You Can Use Today

There are a number of pre-built Agents in a variety of different applications that Microsoft has brought to bear in order to give both partners and customers some good representative examples that almost any client could start using.

Within Dynamics 365, I want to give an example of a pre-built Agent. This Agent monitors an inbox, so your vendors can email that specific inbox and have that inbox take those invoices, read them, process them, and create the payables transaction for you in Business Central. Of course, a human at that point would review the image and attachment that came in the email, as well as what the Agent created as far as that payable invoice to make sure it’s valid and correct. Then that human would perform the final posting.

There’s a lot of third-party tools that do that type of thing, but now it is embedded directly in the Microsoft application via AI.

Largely, agents like this come with the system, but the processing that it does is what you ultimately pay for. So typically, in that case, you would pay with Copilot credits, and typically it would use about 60 to 70 credits for every invoice that it’s processing, which would convert to about 60 cents USD (about a dollar Canadian) to process each invoice.

Encore’s Practical Approach to AI: Start Small and Iterate

While many organizations feel overwhelmed by AI’s possibilities, Encore’s approach is deliberately simple, achievable, and low‑risk. We encourage clients to pilot with a simple use case as the basis for incremental ideation.

We guide our clients through a structured process for AI innovation in their businesses. Start by gathering the informational assets you can use to build on:

What systems do you have in play today that you can draw data from, both internally and externally?

What are some of the key processes, typically interdepartmental processes, that are hindering your efficiency?

What departmental, individual, and organizational-level challenges do you have? Sometimes it’s easy to start at a purely individual level and then fan out from there if you’re having trouble coming up with ideas for where you could use AI.

We take stock of all of that through a series of interviews. Then we pick just one small idea. And then we will typically pilot that for the client.

For the pilot, it’s usually best to start with small steps.

• One workflow
• One data source
• One clear user outcome

From there, you can test, use it in the business, and then iterate with further ideas.

Where Should You Begin with Copilot?

We recommend you start small. Pick a repetitive task, a data‑heavy process, or a manual step nobody enjoys doing. Use Copilot or a simple Agent to automate it. Then gather feedback, iterate, and improve.

If you’re unsure where to begin, Encore’s Copilot Value Prototype can help. It is a fixed-scope, collaborative engagement where we will work with your team to identify potential use cases and create a small working prototype that demonstrates a high-impact use case from start to finish.

Whether you need help identifying your next AI opportunity, building automations, or connecting AI to the rest of your tools, the Encore team is here to guide you with clarity and expertise. Speak with the Encore experts today.