Copilot & Foundry: The Microsoft AI Stack for Small Business · Lesson 2 of 10

Tier 1: Microsoft 365 Copilot (Consume)

Time: ~25 min reading + ~15 min worksheet Goal: Know what M365 Copilot actually is, who needs what license, where it lives, and how to talk about the rollout.

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Microsoft 365 Copilot is the AI assistant embedded across the M365 apps your users already have open all day. It sits in the Outlook ribbon, the Word toolbar, the Excel pane, the PowerPoint slide panel, the Teams chat, and OneNote. Users interact with it through a chat box or through Copilot-branded buttons inside each app.

Under the hood, it uses OpenAI's frontier models (plus Microsoft's own models for certain tasks) combined with a grounding layer that gives it access to the user's own M365 content — their emails, documents, Teams chats, SharePoint, OneDrive, calendar. This grounding is what separates M365 Copilot from ChatGPT: it's not just a clever AI, it's a clever AI that knows what's in your inbox and your file shares.

That grounding is governed by M365 permissions. Copilot can only see what the user can already see. If Joe doesn't have access to the HR folder, Copilot-as-Joe doesn't either. This is the right default — but it also means existing permission sprawl becomes an AI data-exposure problem. More on that in a minute.

There are several products that use the Copilot name. Know the difference.

Microsoft 365 Copilot

• Price: Around $30/user/month, annual commitment
• Requires: A qualifying M365 license (Business Standard, Business Premium, E3, or E5)
• Gets you: Copilot in all M365 apps, Copilot Chat with M365 data grounding, Copilot in Teams meetings
• This is "the" Copilot when most clients say "we're getting Copilot"

Copilot Chat (free tier)

• Price: Free for users with any qualifying M365 license
• Gets you: A ChatGPT-like chat experience at copilot.microsoft.com and within Teams, with enterprise data protection
• Does NOT get you: Grounding on your M365 content, in-app Copilot in Word/Excel/Outlook
• Useful for teams that want a "safe" AI chat tool before committing to full licenses

Copilot Pro (consumer, ignore for business)

• Price: ~$20/month
• For: Individual consumers with personal M365
• Business relevance: Zero. Don't let clients buy this by mistake.

Pay-as-you-go Copilot Chat (for metered usage)

• Some message types are metered and can be billed through an Azure subscription
• Relevant when you're using Copilot as part of agents or integrations, not just for seat licensing

Always check Microsoft's current pricing before quoting. These numbers drift.

Outlook

• Summarize long email threads
• Draft replies in specified tones
• Schedule meetings from natural-language requests
• Find related messages and attachments
• Catch up on what's happened while you were out

Word

• Draft documents from a prompt or from reference files
• Rewrite sections in different tones or lengths
• Summarize documents
• Generate tables and structured content
• Transform meeting notes into formal documents

Excel

• Analyze data with natural-language questions
• Generate formulas and explain them
• Identify trends and outliers
• Create visualizations
• Note: Excel Copilot is still the weakest of the bunch. Don't oversell it.

PowerPoint

• Create decks from a Word doc or a prompt
• Reformat and restructure existing decks
• Generate speaker notes
• Design help (layouts, images)

Teams

• Summarize meetings (live and retroactive)
• Generate action items and decisions from meetings
• Catch-up for channels you missed
• Meeting-during-meeting assist ("what was Jane's objection?")

OneNote

• Organize and summarize notes
• Generate to-do lists from rambling pages
• Rewrite sections

Copilot Chat

• The chat interface at copilot.microsoft.com or in the Teams sidebar
• Works across your M365 data (if you have the paid license) — "summarize all my emails from Jane this week"
• Better for cross-app queries than the in-app Copilots

• Email triage — the #1 productivity win for most users
• Meeting summaries and action items — especially for people who miss meetings
• First-draft writing — any document type
• Information retrieval across M365 — "find me the slide deck where we presented Q2 results"
• Executive briefings — "catch me up on project X" pulls from emails, chats, docs

• Heavy analytical work in Excel — the chat interface is still clunky; most real analysts find it slower than doing it themselves
• Creative visual design in PowerPoint — results are often generic
• Deeply technical or domain-specific writing — it's a generalist
• Consistent house style — without a Copilot Studio agent or Custom GPT-style configuration, it defaults to a vanilla tone

This is important for setting client expectations. Copilot is productivity-amplifier-grade, not replacement-grade.

Here's the conversation that blows up M365 Copilot deployments.

A CFO's assistant turns on Copilot. She asks "summarize our executive compensation discussions." Copilot dutifully searches SharePoint, finds a spreadsheet from 2019 that was shared with "everyone in the company" by mistake, and surfaces salary data the assistant shouldn't see.

This is not Copilot being broken. This is permissions being broken — and Copilot exposing the problem more visibly than any human ever did. The spreadsheet was always accessible to her; nobody ever looked.

Before rolling out M365 Copilot, a client needs a SharePoint and permissions audit. Microsoft Purview can help with this (specifically, DSPM for AI and Data Lifecycle Management). Sensitivity labels applied to sensitive documents also help — Copilot respects them.

This is an important part of any sales conversation. It's also a great way to bundle cleanup work into a Copilot rollout engagement.

For a 50-person SMB, the pattern is:

• Pre-flight (week 1–2): Permissions audit, Purview sensitivity label review, identify existing oversharing risks. Governance posture confirmed.
• Pilot (week 3–4): Enable Copilot for 5–10 users across departments (sales, ops, exec, HR, finance). Collect feedback.
• Training (week 5): 90-minute live training plus a written prompt library tailored to their workflows.
• Phased rollout (weeks 6–8): Enable for the rest of the team in waves. Office hours for support.
• Measure (month 3): Survey usage, gather time-savings data, document the wins. Inform the next phase.

You'll notice this is an engagement, not a switch flip. That's the honest framing for what "turn on Copilot" actually is. Price it accordingly.

A real Copilot rollout for a 50-person company, done well, is a $15K–$40K engagement over 8–12 weeks. It includes:

• Permissions / Purview audit
• Sensitivity label deployment
• Governance setup
• Pilot group selection
• Live training + prompt library
• Phased rollout support
• Metrics and retrospective

Separate from Microsoft's per-seat fee. Clients who don't value this work will go to another consultant who will simply "turn it on," watch adoption fail, and blame Microsoft. Don't compete on that.

"My nephew uses ChatGPT for $20 a month."

Translation: they don't yet see the difference. Show them. Ask them to compare "summarize the emails from Sandra this week" in ChatGPT (can't — no data access) vs. M365 Copilot (does it instantly). The grounding is the value.

"We're not ready for AI."

Often a permissions/governance fear. Lean into it: "You're right, and the first phase of the engagement is specifically to make sure we're ready. Here's what that looks like..."

"My IT guy says the ROI isn't there."

Microsoft's own research suggests 10–30% time savings on relevant tasks; academic studies suggest around 20%. For a knowledge worker at $70K loaded, 15% savings is ~$10K/year. Versus a $360 annual license. The math works when you actually do it.

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• M365 Copilot is the in-app assistant, grounded on the user's own M365 data. That grounding is the value.
• Current price is ~$30/user/month (verify live). Requires a qualifying M365 license.
• Copilot Chat is free for M365 users — works without M365 grounding. Useful as a stepping stone.
• Great at: email, meetings, first drafts, cross-app search. Weaker at: Excel analysis, creative design.
• Permissions hygiene is a prerequisite. Copilot will expose existing oversharing.
• A proper Copilot rollout is an engagement, not a switch flip — $15K–$40K, 8–12 weeks for a 50-person company.

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Next up: Module 3 — Tier 2: Copilot Studio. Where we stop consuming and start composing.

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Time: ~15 min Goal: Practice sizing, positioning, and pitching M365 Copilot.

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For each task, answer: Can M365 Copilot do this well? (Yes / Partially / No). If partial or no, what's the better tool?

• "Summarize the email thread between me and the Acme account this week." → ______________
• "Analyze this 50-sheet Excel workbook and build a new financial model." → ______________
• "Draft a first-pass response to this customer complaint in my usual tone." → ______________
• "Find every document, email, and Teams chat related to Project Northstar." → ______________
• "Turn this Word doc into a client-ready PowerPoint in our brand style." → ______________
• "Build me a chatbot for our customer service team." → ______________
• "Catch me up on what I missed while I was on vacation." → ______________
• "Integrate with our proprietary ERP to pull customer orders into a summary report." → ______________

Client: 75-person engineering firm. M365 Business Premium. They've never formally deployed AI. Owner is curious but not pushing.

Design the engagement. Write one bullet for each phase:

Pre-flight (weeks 1–2): ______________________________________________________

Pilot (weeks 3–4): ______________________________________________________

Training (week 5): ______________________________________________________

Rollout (weeks 6–8): ______________________________________________________

Measure (month 3): ______________________________________________________

Your estimated engagement fee: $_____ Your justification for that fee (one sentence): ______________

Owner says: *"My assistant already uses ChatGPT Plus. Why would I pay Microsoft $30 a seat when that's $20 a month and does basically the same thing?"*

Write your 60-second response. Be specific. Don't just defend — give them a concrete example that makes the difference obvious.

Your response: ```

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Exercise 1:

• Yes — email summaries are Copilot's home run.
• No — heavy analytical modeling is not where Copilot shines. Give the analyst Claude or ChatGPT for the reasoning, have them do the Excel work themselves, or consider a purpose-built analytics tool.
• Partially — Copilot will draft it, but tone consistency requires either a lot of prompt effort or a Copilot Studio agent configured with the company voice. This is your pitch for Tier 2.
• Yes — cross-app search over M365 data is exactly what Copilot Chat with the paid license does. Big win.
• Partially — Copilot can generate a draft deck, but brand consistency is weak. Use PowerPoint templates + Copilot to get better results, or build a dedicated agent.
• No — this is a Copilot Studio project (Tier 2). M365 Copilot doesn't build chatbots for you.
• Yes — the "catch-up" scenario is Copilot Chat's showcase feature.
• No — proprietary ERP integration is either Copilot Studio with a connector or a custom Foundry build, depending on complexity. Not Tier 1.

Exercise 2 — sample rollout:

• Pre-flight: Run Microsoft Purview DSPM for AI scan on their SharePoint and OneDrive. Identify and remediate top 10 oversharing risks. Apply sensitivity labels to sensitive engineering docs (IP, client drawings, financials).
• Pilot: Enable 8 users — 2 from engineering leadership, 2 from PM, 2 from finance, 1 from HR, 1 from exec. Weekly 30-minute check-ins.
• Training: 90-minute session split into two 45-minute parts (M365 Copilot basics, then department-specific examples). Share a one-page prompt library tailored to engineering workflows.
• Rollout: Enable in two waves of ~35 users each. Drop-in office hours Tuesday afternoons during rollout weeks.
• Measure: Quick survey (10 questions), time-savings self-report, highlight 3–5 user success stories.

Fee: $25K (typical range for a 75-person engagement).

Justification: "Permissions audit plus sensitivity label deployment plus pilot-phase-rollout-and-measurement is 100–150 consulting hours. Loaded rate and project coordination. At $30/seat/month ongoing, the rollout cost pays back within 2 months of deployed value."

Exercise 3 — sample response:

> "Totally fair question. ChatGPT Plus is a great tool — I use it too. The difference isn't in the AI itself; it's in what it can see. Right now your assistant has to copy and paste into ChatGPT. With M365 Copilot, your assistant can say 'summarize every email from Acme this week' or 'build me a briefing on the Peterson account based on emails, Teams chats, and the three SharePoint folders about them' — and it does it, because it has permission to see your company's own data. Second piece: it's in the tools she's already using — Outlook, Word, Excel, Teams. She doesn't switch apps. Third: enterprise data protection, audit logs, admin controls — your data stays inside your tenant. The $10 difference per seat per month buys all of that. Want me to show you a before/after on one of your real workflows?"

That's around 55 seconds. Ends with a concrete demo offer, which converts way better than abstract arguments.

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Check yourself: If an owner says "what would a Copilot rollout look like for my company?" — can you scope, size, and price it in 15 minutes without making anything up? That's the bar for Module 3.

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