Digital sovereignty has rapidly moved from a policy debate to a strategic business priority. As nations recognize that cloud, data, and AI are quickly becoming the backbone of economic competitiveness and national security, the focus has shifted toward managing risk, ensuring control, and building resilience in an increasingly volatile environment.

At the same time, leaders face unprecedented complexity: fragmented regulations, rising cyber threats, geopolitical volatility, and accelerating AI adoption are reshaping where data can live, how AI can be trained, and how organizations can balance innovation with control.

Against this backdrop, Microsoft convened global policymakers, CIOs, partners, regulators, and industry leaders in Brussels—and online—for the 2026 Microsoft Digital Sovereignty Summit. The summit brought forward a shared message: Digital sovereignty is not a fixed destination; it is a continuous risk management discipline that underpins resilience, security, and innovation.

Below, we’ll dive into our top five insights from the event and what they mean for organizations both across Europe and globally.

5 key insights from the 2026 Microsoft Digital Sovereignty Summit

1. Digital sovereignty is fundamentally about risk management

One of the clearest themes from the summit was a shift in how leaders define digital sovereignty: not as an abstract policy concept, but as a practical exercise in risk management.

Leaders emphasized that sovereignty today means understanding and managing a complex risk landscape spanning cybersecurity threats, geopolitical disruption, regulatory requirements, and business continuity. The objective is not to eliminate risk entirely, but to assess it clearly and manage it proportionally.

A key takeaway from discussions was that there is no one-size-fits-all approach. Every organization—and every workload—has a unique risk profile, legal obligation, and level of criticality. As a result, sovereignty decisions must be made deliberately, workload by workload, rather than through a single architectural choice or a “universal sovereign cloud” model. This view reflects a broader industry trend away from location‑based assurances and toward enforceable, auditable control across data, operations, and AI.

This reframing marks an important shift: digital sovereignty is no longer about rigid control or ideology but about enabling organizations to operate confidently in uncertainty.

2. Cybersecurity is the foundation of digital sovereignty

A central message throughout the summit was clear: sovereignty without cybersecurity is a non-starter.

Cyber risk has become the most immediate and pervasive threat across sectors, from government and defense to finance, healthcare, and critical infrastructure. Leaders emphasized that cyber threats are persistent, adaptive, and increasingly linked to geopolitical dynamics.

Importantly, discussions challenged the common misconception that isolation equals security. Disconnecting systems or building digital “walls” can create blind spots by limiting access to shared threat intelligence, coordinated response capabilities, and real-time threat detection. As highlighted during the event, modern cyber defense depends on scale, collaboration, and integrated visibility across identity, endpoints, cloud infrastructure, applications, and data.

This reinforces a critical point: sovereignty cannot be achieved without cybersecurity. Without continuous access to global threat intelligence, modern cyber defenses, and interoperable security platforms, organizations cannot maintain real control, resilience, or continuity, regardless of where data resides.

3. Sovereignty and innovation are not tradeoffs; they are mutually reinforcing

Summit speakers shared a strong consensus that organizations do not need to choose between innovation and control. When grounded in strong security and governance, sovereignty creates the conditions necessary for innovation to thrive.

From legal and contractual commitments to purpose-built technical capabilities, discussions highlighted how sovereign frameworks can reduce uncertainty to allow teams to adopt cloud and AI with greater confidence, enabling organizations to move faster, not slower.

This perspective reframes digital sovereignty from a perceived constraint into a strategic enabler that supports competitiveness, resilience, and growth across Europe’s digital economy.

4. Sovereign and powerful AI requires responsible data processing and transparent control

Another major insight from the summit was the growing expectation that sovereign AI must be built on responsible data processing and transparent control. Leaders emphasized that as AI becomes more deeply embedded in core operations, organizations need systems that not only meet today’s regulatory and security obligations, but remain trustworthy, auditable, and resilient as requirements continue to evolve.

Sovereignty in the age of AI extends well beyond data residency. It requires clear, enforceable boundaries around where data is processed, how it is used, and how AI models are trained and executed, combined with full visibility into how AI systems operate across their lifecycle. Assumptions of trust are no longer sufficient—organizations increasingly expect verifiable control, including customer-managed encryption, protections for data while in use, restrictions on operator access, and auditable governance mechanisms that demonstrate compliance in practice.

Critically, sovereignty must be designed end-to-end—spanning infrastructure, platforms, security, data governance, and AI workloads. It is not a single architectural choice or off-the-shelf solution, but a workload-dependent approach aligned to risk, criticality, and mission needs. The summit highlighted how new capabilities are being built across the stack to support sovereign requirements at scale.

5. Digital sovereignty succeeds through collaboration, not isolation

A final and critical insight from the Summit was that digital sovereignty succeeds through collaboration, not isolation.

Across panels and discussions, leaders reinforced that sovereignty depends on ecosystems, where governments, enterprises, and technology providers work together to translate policy into operational reality. Attempts to isolate systems or fragment digital infrastructure can increase risk rather than reduce it, limiting access to innovation, intelligence, and coordinated defense.

Real world examples from customers across Europe, including organizations running regulated workloads on Azure Local, demonstrated how collaboration enables sovereignty at scale. Combining local expertise with global platforms helps organizations maintain control, meet regulatory requirements, and drive innovation simultaneously.

The message was clear: sovereignty is not the responsibility of any single institution. It is a shared commitment, strengthened through cooperation across public and private sectors, and reinforced by partners who align with local priorities.

Digital sovereignty posture in practice

A strong digital sovereignty posture gives organizations choice, visibility, and control across diverse environments. As emphasized throughout the summit, the objective is to align capabilities with risk exposure, regulatory expectations, and the specific needs of different workloads, applying proportionate controls rather than forcing a single model across the entire estate.

In public cloud settings, this means transparency, strong encryption, clear access controls, and accountable operations. For workloads that need greater isolation or local control, hybrid and sovereign solutions provide essential options. Earlier this year, Microsoft expanded its sovereign cloud continuum, enabling critical workloads to run in constrained or disconnected environments while still benefiting from innovation and advanced security practices. This enables critical workloads to run in constrained or disconnected environments while still benefiting from innovation and advanced security practices.

Organizations must focus on flexibility, working to meet today’s requirements while preparing for tomorrow. Features like the EU Data Boundary, long-standing encryption and access safeguards, and operational transparency give customers concrete ways to align with regulations and manage risk.

Across public, hybrid, and private clouds, Microsoft’s approach combines operational discipline with commitments to privacy, security, and responsible AI, creating a foundation for trust, resilience, and sustainable digital sovereignty.

Rooted in risk management

Across every session and conversation throughout the summit, one theme was unmistakable: digital sovereignty is now a continuous, organization-wide discipline rooted in risk management.

Leaders must balance security, compliance, resilience, and innovation—making deliberate, workload-specific decisions in an environment where risks are constantly evolving. Organizations that succeed will be those that treat sovereignty not as a fixed state, but as an adaptive capability built on strong cybersecurity, flexible architectures, and trusted collaboration.

The 2026 Microsoft Digital Sovereignty Summit made this clearer than ever: a sovereign, secure, and innovative digital future is possible, and it’s already taking shape.

Learn more about Microsoft’s approach to Sovereign Cloud and Sovereign AI

• Microsoft Sovereign Cloud website
  
• Build sovereign AI at the edge with Azure Local
  
• Microsoft Sovereign Cloud adds governance, productivity and support for large AI models securely running even when completely disconnected
  
• Navigating digital sovereignty at the frontier of transformation
  
• IDC InfoBrief: Digital Sovereignty Reconsidered: From Location-Based Assurance to Enforceable Control
  
• Sovereignty designed in Europe: Microsoft opens its first studio for resilient cloud and AI architectures in Munich, Brussels and Amsterdam
  
• Microsoft Sovereign Cloud in Europe white paper
  
• Discover Microsoft Sovereign Cloud videos
  

The post 5 takeaways from the 2026 Microsoft Digital Sovereignty Summit appeared first on Microsoft Industry Blogs.

Across banking, capital markets, and insurance, some of the fastest-moving institutions are not simply “adopting AI.” They are becoming Frontier Firms, AI-powered organizations built around human-agent collaboration. In a sector where the cost of error is high, the financial services sector is emerging as an early proving ground for the Frontier Firm model.

The Microsoft 2025 Work Trend Index highlights a widening AI divide. While many organizations remain stuck in pilot mode, Frontier Firms are scaling agentic AI across their operations.

Our work with financial services leaders worldwide shows a clear pattern. The winners in the next generation of innovation will be those that combine human judgment with AI and agents, without compromising security, compliance, or customer trust. Critically, these advantages are best enabled through migration to a modern cloud foundation that can scale AI responsibly and reliably.

The crossroad: Modernize or let legacy debt grow?

Legacy systems have powered financial services for decades. Yet the very qualities that once made them indispensable—custom integrations, tightly coupled architectures, and deeply embedded processes—now create friction and fragility. Increasingly, they can be expensive to maintain, slow to change, and difficult to secure end-to-end. Worse, they can inherently constrain data access across the business, which limits advanced analytics and AI from delivering full value in key areas like customer engagement, fraud prevention, credit decisions, underwriting, and financial crime.

In many institutions, this accumulated technical debt is, in effect, an understated balance-sheet liability. It can increase operational overhead, complicate resilience planning, and broaden the cyber-attack surface. At the same time, regulators are demanding that firms prove stronger controls while, competitively, digital-native challengers are showing what’s possible when technology is designed for continuous change.

Modernization can help answer many of these challenges by helping position firms to gain competitive advantages that go well beyond cost efficiency. As workloads become increasingly cloud-native (in other words, designed to be built, updated, and scaled continuously in the cloud rather than tied to legacy infrastructure), organizations can launch new services faster, respond with agility, and use AI as part of everyday operations.

Waiting to migrate can increase risk and cost

A variety of factors are converging to increase the urgency of modernizing.

• Regulatory pressure is growing. Requirements for operational resilience, third-party risk oversight, data governance, and AI accountability are becoming more explicit and more enforceable. In Europe, the Digital Operational Resilience Act (DORA) raises the bar on stress testing, incident reporting, and information and communication technology (ICT) governance. In parallel, the European Union AI Act introduces demanding expectations for high-risk AI, including transparency, explainability, and bias mitigation. Globally, frameworks shaped by Basel guidance and securities regulators continue to push for stronger risk management, auditability, and controls across financial operations.
• Customer expectations are becoming non-negotiable. “Digital-first” now means more than building a polished mobile app. It means enabling instant transactions, proactive service, and personalized guidance—delivered consistently across channels. Doing all this at scale means that data must move securely and quickly, products should evolve continuously, and controls must be embedded rather than bolted on.
• The threat landscape is getting scarier. Threat actors are using automation and AI to increase both scale and sophistication. In a legacy environment, security improvements often arrive as point solutions, unevenly applied, and hard to validate. Cloud architectures, implemented with the right governance, help enable consistent identity controls, continuous monitoring, and policy-based protection that can be audited and improved over time.

Migration as a lever for innovation

Migration is too often framed as a technology initiative. For business and risk leaders, the more useful long-term view is as to regard it as a control and value strategy, a way to embed governance into the operating fabric of the firm.

This is why many transformation leaders manage cloud adoption as a sequence rather than a singular initiative, with a pathway from rehosting (“lift-and-shift”) through optimization and ultimately to AI acceleration. In this framing, modernization is not the finish line; it is the first step of compounding advantage.

Cloud migration, when managed well, can support a compliance‑by‑design approach, by which policy, identity, and data protections are consistently enforced. It can strengthen operational resilience through architectures that are built for redundancy, automated recovery, and continuous validation. And it can create an innovation pathway by making agentic AI practical to deploy and manage.

The AI-first divide: Cloud as operating model

As we see with Frontier Firms in financial services, innovation leaders tend to treat cloud architecture as more than an infrastructure choice. They use it as an operating model to standardize controls, build reusable platforms, and design processes that are increasingly AI-operated but human-led. The payoff can show up in faster deployment cycles, a lower cost per transaction, and predictive insights that make customer experiences more personal and operations more resilient.

Reaching that maturity typically requires progress across four transformation engines:

• Infrastructure modernization
• Legacy systems migration
• Systems modernization (including new business systems)
• Data modernization with AI integration

Financial services firms face stricter scrutiny than most industries, so the differentiator is not speed alone, it’s the ability to sustain speed while continuously demonstrating security, compliance, and control effectiveness.

We see this in practice across the industry. For example, UBS, following its acquisition of Credit Suisse, migrated a mission‑critical records platform from mainframe to a cloud‑native service on Microsoft Azure, reducing total cost of ownership by nearly 60% and improving their ability to meet regulatory demands. After LSEG migrated its high-volume, mission-critical Autex Trade Route (ATR) trading network from on-premises to Azure, the gains in scalability and resilience helped them absorb a sudden 400% surge in trading volumes with zero incidents. And the National Bank of Greece modernized document processing to improve accuracy and enable faster, more digital customer journeys. The common thread is not a single tool or model, it’s a cloud foundation that supports governed data, resilient operations, and repeatable innovation.

Turning migration into long-term value

For many firms, the hardest part of migration is not the technology; it’s making the journey auditable, repeatable, and aligned to risk appetite. That’s why a structured approach matters.

The Microsoft Cloud Adoption Framework, tailored for financial services, is designed to help institutions align cloud modernization to business outcomes while addressing the governance realities of the industry: data sovereignty expectations, operational resilience, and security-by-design. Importantly, cloud migration need not undermine data sovereignty; done right, migration strengthens locality, control, and compliance through governed architectures.

In practice, migration means helping businesses to build a compliant foundation, innovate responsibly, and maintain continuous control visibility as they scale. Microsoft supports this with financial-services-ready architectures, built-in governance and security capabilities, and a broad set of certifications and controls. Just as importantly, we work closely with customers and regulators globally to help ensure that cloud adoption can be evidenced properly in terms of risk reduction, resilience, and measurable operating improvement.

Trustworthy AI starts with the cloud foundation

Boards and regulators are right to focus on AI governance. Generative AI, agentic systems, and intelligent automation can improve productivity and customer outcomes, but only when they operate on governed data, with strong identity controls, clear lineage, and auditable policies. Those prerequisites are difficult to achieve in fragmented legacy environments.

Cloud migration creates the conditions for AI to be adopted responsibly, with modern data platforms and pipelines, elastic compute for experimentation and scale, consistent policy enforcement, and continuous monitoring.

To help institutions navigate migration with confidence, Microsoft combines a financial-services-tailored methodology with practical tooling and built-in governance. The Cloud Adoption Framework for financial services provides a proven, risk-aligned approach to planning and executing secure migrations. Azure Migrate and the Azure cloud migration and modernization programs help accelerate discovery, modernization, and execution with guidance and incentives. And capabilities like Microsoft Purview and Microsoft Defender for Cloud help establish compliance guardrails and security posture management from day one.

Lead the next generation with cloud

Migration is not the end state of digital transformation. It is the foundation for Frontier transformation, one which can enable firms to innovate faster, demonstrate stronger controls, and adapt quickly to new demands and opportunities.

The financial services firms that lead in the next generation of financial services will not be those that move the fastest in a single quarter. They will be the ones who modernize with technology that is durable, designed for operational resilience and evidence-based governance, and that makes innovation repeatable. Cloud migration is the inflection point where these powerful advantages become possible.

Learn more

• To explore a five-phase, risk-aligned approach to cloud migration that helps build the foundation for AI-first financial services, read the e-book: Becoming an AI-First Firm in Financial Services.
• Register for the Migrate and Modernize Summit to learn from industry leaders.
• Explore the Microsoft Cloud Adoption Framework for Financial Services.

The post Why cloud migration is key to realizing AI value in financial services appeared first on Microsoft Industry Blogs.

Maritime trade accounts for more than 80% of global trade by volume, making ports a foundational pillar of the global economy, according to UN Trade & Development (UNCTAD).¹ As trade volumes grow and supply chains become more interconnected, ports are asked to do more than move goods efficiently. They must coordinate increasingly complex operations, integrate data across fragmented systems, and enable safer, more predictable decision-making across a diverse ecosystem of stakeholders.

Meeting these demands requires a fundamental shift in how ports modernize their operating models to meet these demands, moving from siloed, reactive operations toward integrated, data‑driven, and intelligently orchestrated systems.

From Port 4.0 to Port 5.0: Capability over complexity

Port 4.0—widely used across the industry as shorthand for digitalized, connected port operations—laid the foundations through shared data, connected infrastructure, and more informed decision-making.

In our Ports of the Future framework, Port 5.0 is how we envision the next stage of operational capability—where ports orchestrate flows of goods, data, energy, and trust through integrated platforms and governed intelligence.

At a high level, Port 5.0 is about:

• Moving from visibility to coordinated action
• Embedding intelligence into daily decisions, with people in control
• Designing collaboration, governance, and security from the outset

This evolution is shaped by interconnected building blocks—from AI-supported control towers and connected inland corridors, to energy aware operations, trusted data collaboration, advanced optimization, immersive digital twins, and all hazards infrastructure resilience.

A new wave of enabling technologies

In the Ports of the Future framework, Port 5.0 is defined by a set of core operational capabilities. What has changed in the last 12–18 months is the maturity of technologies that now make these capabilities practical to deploy at scale.

• AI-supported operations
  AI systems can now assist with multistep operational workflows—monitoring conditions, proposing replans, and surfacing high impact exceptions for human decisionmakers—moving control towers from visibility toward orchestration, while remaining governed.
• Confidential computing for sensitive collaboration
  Hardware- based trusted environments enable organizations to process sensitive data while maintaining strong protections, supporting cross agency analytics and collaboration without compromising established data handling policies.
• Advanced optimization approaches
  Quantum-inspired and heuristic optimization methods help ports address complex scheduling and routing challenges—berths, yards, rail paths, labor, and inspections—particularly under disruption, when suboptimal decisions compound quickly.
• Digital twins and simulation
  Immersive digital twins increasingly serve as shared operational environments, integrating real-time data with simulation to support planning, training, and coordinated decision-making. AI-based simulation contributed to improved vessel punctuality and measurable operational gains, according to a case study of Busan Port,² illustrating the potential of these approaches when deployed thoughtfully.
• Security and governance by design
  As ports become data hubs, cybersecurity, identity management, and access controls are increasingly embedded into platform architecture from the outset.

Together, these capabilities help ports move from reactive operations to coordinated, system level performance—while keeping people in control and governance at the center.

Develop core operational capabilities

The Ports of the Future whitepaper explores these building blocks in depth, with real world examples and a pragmatic 24–36 month roadmap that helps ports move from vision to execution.

Explore Microsoft for public finance to help reignite the economy and drive financial accountability with public finance technology solutions.

¹ Shipping data: UNCTAD releases new seaborne trade statistics 

² In August container ship punctuality at 65.3% — World Ports Org 

The post Ports of the future: Building a framework for the modern port appeared first on Microsoft Industry Blogs.

Exactly one year ago, we outlined how generative AI is creating a new era of efficiency and innovation for logistics and supply chain. We mapped AI use cases across the value chain, from demand forecasting to AI-based customer service, and introduced two new reference architectures for logistics and supply chains: adaptive cloud and AI‑enhanced experiences, alongside innovations in Microsoft Dynamics 365.

Since then, technology has rapidly evolved. We are now in the agentic era of AI with agents being capable of reasoning, planning, and taking action across complex supply chain workflows. End-to-end agent hosting like in Microsoft Foundry and open protocols such as Model Context Protocol (MCP) have made it easier for AI agents to connect with each other as well as enterprise systems, tools, and data.

Additionally, there have been significant advances in 3D simulations, robotics, and embodied intelligence. Open platforms for physical AI like NVIDIA Cosmos with world foundation models (WFMs) as well as the OSMO edge-to-cloud compute framework on Azure enable machines and humanoid robots to act more effectively in the physical world, resulting in broader automation across warehouses, distribution centers, and transportation. This new article picks up Microsoft’s perspective on supply chain and logistics one year after our previous blog article and explores how our own logistics teams as well as frontier customers and partners use this new wave of innovations together with Microsoft.

Microsoft supply chains: Our own “customer zero” story

Microsoft operates one of the world’s most far-reaching cloud supply chains spanning more than 70 Azure regions, over 400 datacenters, and a network of more than 600,000 km of fiber. Our datacenters are the backbone of Microsoft Azure powering everything from AI infrastructure and collaboration tools to networking and security. Microsoft also runs supply chains for Microsoft Windows and Devices with Surface hardware and PC accessories as well as Xbox consoles and gaming hardware.

All of our supply chains have undergone a fundamental transformation over the past decade, evolving from a reactive, manual environment into a rapidly emerging autonomous, agentic supply chain. In the past, our operations were dominated by Excel-based reporting, limited visibility, and siloed data. In 2018, we consolidated more than 30 systems into a single supply chain supply chain data lake on Azure, enabling predictive analytics and the first generation of cognitive supply chain capabilities. In 2022, we began experimenting with generative AI, followed by the development of an AI platform to operationalize agents at scale. Today, this foundation is accelerating to fully autonomous agents, and more than 25 AI agents and applications have been deployed. Below are three examples:

• The Demand Planning Agent drives AI‑based demand–simulations for non‑IT rack components—improving forecast accuracy and reducing manual reconciliation.
• The Multi‑Agent DC Spare‑Part Space Solver uses computer‑vision‑driven monitoring and multi‑agent reasoning to forecast spare‑part storage needs and proactively mitigates space or stockout risks.
• The CargoPilot Agent continuously analyses transport modes, routes, cost structures, carbon impact, and cycle times—providing optimized shipment recommendations that balance speed, sustainability, and efficiency.

The goal is to operate over 100 agents by the end of 2026 and equip every employee with agentic support. The impact today is already huge: AI in logistics is saving our teams hundreds of hours each month demonstrating how agentic operations are translating directly into efficiency and business value. Both in our own Microsoft supply chain transformation and Frontier customers we work with, we have seen that unifying the data estate is key. Yet, it’s what organizations do next that truly generates value with AI.

In supply chain, we believe real value gets unlocked by driving three elements:

• Enabling AI-powered supply chain simulations.
• Building agentic supply chains.
• Integrating first physical AI innovations.

Simulations: The digital twins of supply chains

As supply chains become larger, more interconnected, and more exposed to global volatility, simulating scenarios before they unfold is becoming a critical capability to reduce risk and increase resilience. Discrete event-based simulations (DES) within supply chains enable the development of a virtual risk-free model to test how a complex system reacts to interventions and variables before implementation. With Microsoft’s advanced modelling tools such as Azure Machine Learning and the new machine learning model in Microsoft Fabric with Power BI semantic models, organizations in supply chain and logistics can simulate demand patterns, shortages, or supply chain disruptions.

Our partner paiqo offers with prognotix an AI-powered Forecasting Platform available on the Microsoft Marketplace. More than 70 algorithms enable supply chain experts to generate and optimize highly accurate demand forecasts directly within their Azure environment. Cosmo Tech offers an AI simulation platform for Advanced Supply Chain Risk Management on Azure, offering enterprise customers dynamic digital twins that simulate how disruptions and decisions impact system-wide performance. InstaDeep uses Azure in high-performance compute for AI-enabling deep reinforcement learning and predictive analytics that optimize last-mile delivery, inventory levels, and fleet utilization.

The next level of simulation combines multiple physical simulations in 3D environments and discrete event-based simulations to enable teams to build comprehensive digital twins of warehouses, distribution centers, production lines, and logistics networks. These virtual environments allow organizations to model both the physical behavior of assets and the dynamic flow of operations. By integrating these simulation methods within a digital twin and applying AI, teams can predict future outcomes, optimize performance, and prescribe actions that drive continuous operational improvements. This can help customers lower capital expenditure, shorten commissioning, and ramp up phases, as well as improve operational key performance indicators (KPIs).

Taking warehouses as an example, customers and partners can build advanced, AI-enabled 3D visualizations for four key scenarios:

• Warehouse planning (such as greenfield and brownfield).
• Warehouse monitoring (like real-time monitoring and people movement heatmaps).
• Warehouse improvement (for example trailer dwell time optimization and collision detection for safety and automation).
• Warehouse maintenance (like asset monitoring in real-time, detect quality issues, and reduce rework).

In collaboration with NVIDIA we offer access to NVIDIA libraries and frameworks including NVIDIA Omniverse™, NVIDIA Isaac Sim™, and NVIDIA Omniverse Kit App Streaming that enable developers to build applications and workflows to simulate and test intelligent machines in digital twins before building or deploying anything in the real world. Applications built on these libraries and frameworks allow developers seamlessly integrate geometry data (such as 2D, 3D, and point clouds), AI capabilities (for example large language models, Volume Shadow Copy Service (VSS), and Solvers), and Internet of Things (IoT) signals across operational technology (OT) environments.

The reference architecture below illustrates how to combine cloud and edge computing using NVIDIA Omniverse Kit App Streaming to visualize warehouse operations in real-time with graphics processing unit (GPU) accelerated Kubernetes clusters natively deployed on Azure to remotely monitor, analyze, and optimize warehouse performance with greater precision and situational awareness.

Inside the physical warehouse, operational data from robotic arms, conveyors, and warehouse sensors are captured on the edge using Azure IoT Operations running on Arc-enabled Kubernetes and using MQTT broker. The architecture adopts the Universal Scene Description format (OpenUSD) to ensure that 2D, 3D, and point cloud geometry from the warehouse can be seamlessly integrated into the digital twin. Microsoft Fabric takes up the data in the cloud to provide a unified analytics foundation. Eventstream and eventhouse capture incoming telemetry as real-time streams or batch data. Microsoft OneLake acts as the governed, centralized data lake that consolidates all warehouse data. Digital twin builder transforms raw IoT signals into a contextualized virtual representation by mapping telemetry to the warehouse’s digital model. Powered by NVIDIA Omniverse, high-fidelity simulation and spatial computing occur creating a real digital twin which is streamed directly to the browser—eliminating the need for high-end local hardware. Tools such as Microsoft Copilot Studio and Microsoft Foundry enable natural language interaction. Across all stages, security is maintained through Azure Arc, ensuring consistent governance, configuration, and policy enforcement across edge and cloud.

SoftServe has proven to be an excellent delivery partner for digital twin applications. Together with Microsoft, they seamlessly integrated AI agents built on NVIDIA libraries and open models into beverage production simulations at Krones, enabling physical-accurate digital twins that reduced cycle times from hours to under five minutes. Similarly, at Toyota Material Handling Europe, SoftServe built a digital twin for simulating autonomous forklifts in virtual warehouse environments, enabling rapid testing, optimization, and safer deployments, helping to reduce the training times of autonomous systems by more than 30%.

TeamViewer’s augmented reality platform Frontline provides an additional simulation angle. Wearables such as smart glasses or wrist-mounted devices bring data seamlessly to frontline workers to get guidance in a hands-free manner for picking and packing as well as AI‑assisted counting. At DHL Supply Chain, TeamViewer’s solution is deployed globally to support vision picking of over 1,500 workers across 25 United States sites with fully hands‑free processes.

Agentic supply chains: The multi-agentic web

Agentic supply chains mark a new era of autonomous AI systems that proactively manage and optimize end-to-end supply chain operations. These agentic systems aim to continuously improve overarching KPIs like operating margin or cash conversion as well as specific KPIs such as lead time or freight cost per unit, ensuring that every agentic action contributes to measurable business impact.

Agentic supply chains are built on today’s human-driven tasks and encode the underlying decision-making logic. They include single purpose agents such as “troubleshooters” that constantly diagnose issues and propose fixes as well as “orchestrator agents” like planners or organizers that coordinate multistep workflows. These agents become functional through modern data fabrics, robust systems of record, and event-driven architectures that provide real-time information and governance.

Below is an overview of supply chain agents we have identified along the value chain through multiple customer and partner discussions.

Frontier Firms have already created value with multi-agentic systems.

• CSX Transportation has deployed a multiagent system that validates customer eligibility, routes complex requests, and supports rail operations with multistage coordination.
• Dow Chemical operates invoice analysis agents that review thousands of freight invoices each day, automatically detecting discrepancies and saving the company millions across its global shipping network.
• C.H. Robinson has rolled out a large fleet of generative AI agents including fast quoting agents that deliver tailored freight quotes and automating key steps along the shipping lifecycle.
• Blue Yonder has created an off-the-shelve Inventory Ops Agent on the Microsoft Marketplace that identifies supply–demand mismatches in real-time and recommends corrective actions such as alternate sourcing or demand swaps to keep inventory levels optimized.
• Resilinc offers an agentic supplier risk platform on Azure with pre-built AI agents (like for disruption, tariffs, and compliance) that autonomously evaluate potential impacts, initiate supplier engagement and recommend mitigation strategies.
• o9’s Digital Brain platform on Azure has been enhanced with various AI agents taking over simple tasks like getting specific data and more complex like creating full demand reviews.
• GEP recently added to their source-to-pay GEP SMART and supply chain solution GEP NEXXE (both built natively on Azure), a portfolio of AI agents that cover sourcing, negotiation, contract lifecycle, spend analysis, and market intelligence.
• Kinaxis offers its Maestro supply chain planning platform including AI agents that sense disruptions, run scenario simulations, and provide prescriptive insights through natural language.

Additionally, several delivery partners have used Microsoft tools like Microsoft Foundry and Copilot Studio to build agents for customers at high speed.

• Avanade, for example, offers concrete off-the-shelf agents including a trade compliance agent, a digital twin agent, and lead-2-cash agents.
• Softserve offers a catalyst with 3 customized agents in 30 days.
• NTT DATA is developing a simulation-driven, agentic AI-powered decision-support system for supply chain network agentic rebalancing platform.
• PwC delivers end-to-end agentic AI consulting services, powered by distinctive industry expertise.
• Capgemini is currently building an agentic end-to-end offering using the latest Microsoft IQ technology to be released at Hannover Messe in April 2026.

Microsoft Work IQ, Foundry IQ and Fabric IQ together form an intelligence layer for supply chains—from demand planning to inventory and customer service—that connects how people work, how the business operates, and what the organization knows. This gives AI agents full enterprise context so that agents can reason, simulate scenarios, and act in line with real-world constraints and KPIs such as inventory turnover to support better decisions.

Together with our strategic partner Celonis we have developed a new reference architecture leveraging Fabric IQ and the Celonis Process Intelligence Graph to transform fragmented supply chain data into agentic workflows. A collaborative stack that integrates raw data at the bottom and creates intelligent, automated actions at the top.

On the System of Record (SoR) layer, data is often siloed and does not “speak the same language,” leading to a fragmented understanding within the supply chain. Microsoft Fabric unifies this data through mirroring, streaming, or multi-cloud shortcuts with the goal to create a zero-copy connection and ensure the data is fresh and accessible without the weight of traditional extract, transform, and load (ETL) processes. Fabric IQ provides a reasoning layer that translates raw, unified data in OneLake into context-aware insights. This is the basis for Celonis’ Process Intelligence (PI) Graph which sits between data and the automation and uses process mining to map out how the supply chain actually runs—generating operational supply chain insights and suggesting improvement potentials from a process point of view. It communicates with Microsoft Fabric through Rest APIs, providing the knowledge and context that AI needs to make sense of the data. The agentic layer is divided into three functions:

• Building: Use Copilot Studio, Microsoft Foundry, and Power Automate to create custom AI agents.
• Orchestrating: Use MCP and Agent2Agent Protocol (A2A) to manage how different agents work together.
• Overseeing: Use the control plane for agents in Agent 365 (generally available in May 2026) to monitor agent activities and ensure performance as expected.

On the top layer, with the help of Microsoft Entra ID, insights and suggested actions are shown in tools employees use, such as Microsoft Teams, Microsoft 365 Copilot, Dynamics 365, Power Apps or in the Celonis UI.

A large global pharmaceutical company is using the above architecture to unify fragmented logistics data, enabling real-time identification of temperature-critical pharmaceutical returns and designing an agentic return process that unlocks multi-million euro annual productivity gains. Uniper automated material and service needs with Celonis and Microsoft. Microsoft Copilot in Teams and Power Automate orchestrate approvals, SAP actions, and replace manual component planning with proactive, agentic workflows that ensure timely material availability.

Physical AI: From warehouse handling to last mile deliveries

Physical AI is the final evolution of supply chain intelligence, building on simulations and agentic AI and embodying that intelligence directly in the physical world. In the near future, humanoid robots and robotic systems will physically take over more and more operational tasks along supply chains and logistics: from trailer unloading and sorting, pallet handling and replenishment, to packing and labelling and autonomous last‑mile deliveries. As intelligence moves from screens into machines, supply chains and logistics may gain a new level of physical agility.

Microsoft is pushing the frontier of physical AI with it’s new Rho‑alpha robotics model that combines natural language, visual perception, and tactile feedback to make robots more adaptive and autonomous. Microsoft has launched an early access research program with selected partners to advance co‑training and domain adaptation and aims to integrate the model in Microsoft Foundry in the coming months. Already today, customers and partners may take the below robotics toolchain reference architecture to train and deploy warehouse robotics with NVIDIA Osmo on Azure.

This toolchain is an open-source, production-ready framework that integrates Azure cloud services with NVIDIA’s physical AI stack, from simulation to training and deployment. It combines Azure Machine Learning, Azure Kubernetes Services (AKS), Microsoft Fabric, Azure Arc, and NVIDIA’s robotics and AI stack. NVIDIA Isaac Sim and Isaac Lab enable high-fidelity simulation and reinforcement learning, while NVIDIA OSMO orchestrates scalable training workflows across cloud and edge environments.

Detailed information can be found here.

Hexagon Robotics has started to deploy this architecture using Azure IoT Operations as well as Fabric Real-Time Intelligence in Microsoft Fabric to provide production-ready humanoid robotic solutions. Their industrial humanoid robot, AEON, combines dexterity, locomotion, and unique spatial intelligence to tackle complex industrial use cases for warehousing and logistics such as inspection and inventory taking.

Figure AI, funded by Microsoft, enables the deployment of their humanoid robots in real-world logistics environments using Azure’s AI infrastructure. Their latest model Figure 03 can take over warehouse tasks such as sorting packages at conveyor belt speeds and help at last-mile delivery with near human-level precision.

KUKA and Microsoft jointly developed iiQWorks.Copilot, an AI-powered assistant that enables natural language robot programming and significantly simplifies automation tasks. By integrating Azure AI services, the solution allows users to design, test, and deploy robot workflows faster and more safely—cutting programming time for simple tasks by up to 80%. This has benefitted all KUKA robotics deployed in warehouses and logistics.

Wandelbots’ NOVA software layer combined with Azure cloud services unifies heterogeneous robots and brings adaptive automation to the shop floor. Wandelbots NOVA streamlines warehouse and fulfillment operations such as palletizing by simplifying robot programming, accelerating deployment, and enabling AI-powered path planning and scaling across multiple robot brands. Together, these capabilities position Wandelbots NOVA as a physical AI platform for orchestrating and scaling AI-powered automation across supply chain operations.

Get in touch with us

Contact us directly at screquests@microsoft.com or go to Microsoft for Manufacturing to explore how Microsoft technologies can transform your supply chain. Join us at Hannover Messe in April 2026 to hear directly from our industry leaders, explore cutting-edge ideas, and connect with peers.

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That is where AI comes in. To break the infrastructure bottleneck and shift the industry from ambition to delivery, Microsoft is announcing an AI for nuclear collaboration with NVIDIA, to provide end-to-end tools that streamline permitting, accelerate design, and optimize operations across the industry.

This set of technologies brings disciplined engineering to the entire lifecycle of a nuclear plant—spanning site permitting, design, construction, and continuous operations. By enabling these capabilities within a connected, AI-powered foundation, we are empowering energy developers to make highly complex work repeatable, traceable, secure, and predictable—slashing development timelines and eliminating rework without sacrificing safety.

The digital foundation for nuclear at scale

The only thing that may be more complex than building a nuclear plant is designing and permitting one. Permitting alone can take years, cost hundreds of millions of dollars, and involve an immense amount of data processing and reporting. It’s not a lack of need, knowledge, or even willingness that’s holding development back, but rather the inability to progress efficiently and consistently through rigorous permitting and development processes.

Engineers can spend thousands of hours drafting, cross-referencing, formatting, searching, reviewing, and reworking materials. They have to identify and fix inconsistencies across tens of thousands of pages. It is little wonder that plants have been notorious for construction delays and cost overruns.

To break this infrastructure bottleneck, we need to move away from highly customized engineering towards repeatable, reference-based delivery—while maintaining regulatory standards and engineering accountability.

With AI, we can identify tiny documentation inconsistencies and resolve them quickly. By unifying data and simulation across the lifecycle, we ensure complex work remains:

• Traceable: Every engineering decision is digitally linked to the evidence and regulations that back it up.
• Audit-Ready: The system keeps a perfect “paper trail,” ensuring that regulators can verify safety instantly.
• Secure: High-level intelligence is applied within a governed, protected environment.
• Predictable: High-fidelity simulations map time and cost, catching delays before they happen in the real world.

This isn’t just about speed; it’s about trust. Engineers and regulators are freed to focus on what matters most: building a safe, secure, high-capacity, carbon-free power source that’s on-time and on-budget.

Here is how AI and Digital Twins can carry a project from the initial phases to efficient operations:

• Design and engineering: Digital Twins and high-fidelity simulations enable faster iteration. Engineers can reuse proven patterns and instantly see how a tiny design change impacts the entire model, creating a validated plan before breaking ground.
• Licensing and permitting: Generative AI handles the heavy lifting of document drafting and gap analysis. It unifies all project information, ensuring comprehensive applications aligned with historical permits. This allows expert regulators to focus their time on safety judgments rather than reconciling thousands of pages of text.
• Construction and delivery: While traditional 3D models only map physical space, 4D (time scheduling) and 5D (cost tracking) simulations can virtually construct the plant before shovels hit the dirt. AI and Digital Twins allow developers to track physical progress against the digital plan in real-time, catching potential delays and preventing the schedule collisions that lead to expensive rework.
• Operations and maintenance: AI-powered sensors and operational digital twins detect anomalies early, ensuring higher uptime and predictive maintenance that keeps the grid stable with human operators firmly in control.

By unifying data, traceability, and simulation across phases, AI accelerates design validation with high-fidelity 3D models and Digital Twins, improves licensing consistency through AI-assisted document workflows, and connects design assumptions to operational performance—giving operators, regulators, and stakeholders clearer, continuous visibility.

Accelerating delivery: How Aalo Atomics, Idaho National Labs, and Southern Nuclear are deploying AI for nuclear

The proof is in the progress. Our collaboration is already changing the pace of nuclear delivery.

Aalo Atomics

Aalo Atomics has reduced the time-intensive permitting process by 92% using the Microsoft Generative AI for Permitting solution, saving an estimated $80 million a year. For Aalo, the value of the Microsoft and NVIDIA collaboration isn’t just speed—it’s confidence.

“Two things matter most: enterprise-scale complexity and mission-critical reliability. We’re deploying something complex at a scale only a company like Microsoft really understands. There’s no room for anything less than proven reliability.”

—Yasir Arafat, Chief Technology Officer, Aalo Atomics

Southern Nuclear

Southern Nuclear has developed and deployed agents using Microsoft Copilot across its fleet, including engineering and licensing, to improve consistency, reuse knowledge faster, and support better decision-making in key workstreams.

Idaho National Laboratory

When it comes to the public sector and specifically United States Federal, Idaho National Laboratory (INL) has become an early adopter of AI for nuclear technology. By using the AI capabilities to automate the assembly of complex engineering and safety analysis reports, INL is streamlining the review process and creating standard methodologies for regulators to adopt these tools safely, further speeding deployment.

Expanding the ecosystem: How Everstar and Atomic Canyon are operationalizing AI for nuclear on Microsoft Azure

Microsoft is actively expanding this secure ecosystem. Everstar—an NVIDIA Inception startup—brings domain-specific AI for nuclear to Azure to modernize how the industry manages project workflows and governed data pipelines.

“The nuclear industry has been bottlenecked by documentation burden and regulatory complexity for decades. This partnership means our customers get the secure, scalable cloud deployments they demand. It’s a significant step toward making nuclear power fast, safe, and unstoppable.”

—Kevin Kong, Chief Executive Officer, Everstar

We are also excited to highlight Atomic Canyon, whose Neutron platform is now available in the Microsoft Marketplace, allowing nuclear developers to deploy these capabilities with consistency and control through trusted procurement pathways.

Progress at the pace this moment requires

AI is enabling the energy industry to deliver more power, faster, and safely. This Microsoft and NVIDIA collaboration provides the path to do exactly that for advanced developers, owners, and operators. By turning fragmented, high-variance workflows into governed, auditable systems, we can compress timelines without compromising rigor. By unifying data, simulation, and evidence across design, permitting, construction, and operations, we are accelerating the deployment of firm, carbon-free power while strengthening regulatory confidence and operational resilience.

The AI for nuclear operations collaboration brings together NVIDIA Omniverse, NVIDIA Earth 2, NVIDIA CUDA-X, NVIDIA AI Enterprise, PhysicsNeMo, Isaac Sim, and Metropolis with Microsoft Generative AI for Permitting Solution Accelerator and Microsoft Planetary Computer to create a comprehensive, AI-powered digital ecosystem for nuclear energy on Azure.

Microsoft, NVIDIA, and Aalo Atomics will be presenting this AI-lead industry perspective at CERAWeek 2026 in a session entitled “A Digital Age for Nuclear: Aalo Atomics, NVIDIA, and Microsoft.”

Discover more

Ready to move from ambition to delivery? See how the Microsoft and NVIDIA nuclear for AI collaboration can drive change within your organization.

Contact us to learn more.

The post AI for nuclear energy: Powering an intelligent, resilient future appeared first on Microsoft Industry Blogs.

As capital markets firms push toward the frontier, success increasingly depends on turning AI ambition into secure, repeatable operating impact at global scale. In this independent IDC guest blog, Thomas Shuster examines how agentic AI is reshaping capital markets operating models—and why firms are gravitating toward platforms and partners that combine technological leadership, deep industry expertise, strong governance foundations, and proven experience delivering AI value across the end-to-end value chain.

When capital markets leaders talk about Frontier Firms, it is important to recognize that the term’s definition has shifted. It is less about being first to experiment with new tools and more about translating AI investment into measurable, repeatable operating gains. That distinction matters as the operating environment tightens. Settlement cycles continue to compress, regulatory expectations change, and risk controls must remain effective as markets evolve. At the same time, technology teams are expected to modernize while continuing to support large legacy environments. In this context, agentic AI emerges as a practical marker of frontier operating models.

From tools to operating models

Early generative AI tools improved drafting, summarization, and search. These capabilities were helpful but not transformative or differentiated. The step change occurs when firms shift from task acceleration to workflow redesign, deploying AI agents to execute multistep processes across systems under bounded human oversight.

Frontier Firms focus on workflows characterized by high friction, frequent exceptions, and material costs when delayed. They redesign processes so agents perform the coordination and context gathering work that typically slows teams down: pulling data, checking policies, identifying breakpoints, proposing actions, and routing tasks to the right owners. Humans remain accountable for decisions but no longer act as the connective tissue that holds workflows together. This shift has important workforce implications because human effort moves away from manual orchestration and toward judgment, escalation, and decision-making.

By contrast, non-Frontier Firms often attempt to layer AI onto workflows still defined by manual handoffs and fragmented systems. These initiatives may succeed in pilots but frequently stall when exposed to real-world operational variability.

Integration, not intelligence, is the limiting factor

Many operational breakdowns in capital markets stem from fragmented information. Trade exceptions can span execution data, reference data, allocations, settlement instructions, and counterparty communications. Know your customer (KYC) refreshes depend on sanctions data, beneficial ownership structures, customer documentation, and policy interpretation. These are inherently cross-system and, increasingly, cross-organization challenges.

Frontier Firms treat data access as a core capability rather than a downstream integration problem. They invest in ecosystems that support secure, permitted access to internal and external data with auditability and clear economic and contractual rules. In practice, the operating framework often matters as much as the underlying technology. Questions of data ownership, computational rights, value sharing, and dispute resolution frequently determine whether an agentic use case can scale. Where these foundations are absent, teams compensate with manual workarounds that are slow, error-prone, and difficult to audit.

Governance as an accelerator

There is a persistent tendency in capital markets to defer governance until a use case has demonstrated value. That approach breaks down with agentic AI. Agents act within workflows and can trigger downstream consequences if controls are weak.

IDC’s research shows that only about 4% of financial institutions believe AI agents should operate with full autonomy. More than 75% rate transparency as very or extremely important, with the share rising to roughly 88% among Frontier Firms. How frontier organizations operationalize trust reflects these preferences. They define which decisions require human approval, log agent inputs and actions, establish clear escalation paths, and design workflows that make overrides straightforward. Many organizations also prefer to rely on platform-level governance capabilities rather than bespoke controls for each use case.

When done well, governance becomes an enabler rather than a constraint. It allows firms to deploy agentic workflows more broadly and with fewer surprises, aligning risk and innovation teams. Where governance lags, organizations often see the opposite outcome: Risk teams perceive AI as uncontrolled, innovation teams view governance as blocking progress, and value remains trapped in isolated proof points.

Where Frontier Firms pull ahead first

IDC finds that Frontier Firms adopt functional and industry use cases almost twice as much as their peers. Expectations for automation are also rising. In IDC’s resiliency and spending research, 87% of firms expect providers’ agentic AI capabilities to eliminate manual and semi-manual workflows within 18 months.

The gap widens most quickly where speed, exception handling, and control converge. In post-trade operations, many organizations still manage exceptions through email and informal handoffs, slowing resolution, and weakening auditability. Frontier Firms move toward agent-supported, structured case management. In onboarding and due diligence, event-driven regulatory expectations are making periodic refresh models brittle. While only about 10% of financial institutions used AI for regulatory compliance in the past year, nearly 90% plan to do so in the next 12 months. In research and intelligence functions, agents increasingly monitor sources, summarize changes, and map exposures, shifting human effort from aggregation to decision making.

AI is reshaping business models

The frontier advantage is not limited to efficiency. IDC’s research shows that organizations using agentic AI report a 2.3-time return on investment (ROI), with average payback periods of about 13 months. These attractive economics are accelerating investment. Building customized AI agents to automate business processes ranks as the top area of significantly increased IT spending among capital markets firms in 2026, which more than 80% of organizations have cited.

As these agents mature, firms are also reassessing their application strategies. In IDC’s survey, 84% of financial services firms agree that AI agents are emerging as a new layer of enterprise capability, prompting renewed scrutiny of investments in packaged applications.

Closing thought

Agentic AI is not a shortcut around complexity. It is a way to absorb complexity without scaling cost and risk linearly. Ambition alone does not distinguish Frontier Firms. Differentiating them are data access, governance discipline, operating model design, workforce readiness, and organizational habits required to turn agentic AI into a durable source of advantage.

Explore more insights on agentic AI in capital markets

• Read IDC’s Analyst Connection How and Where Frontier Firms Are Bending the Curve on Innovation and explore the infographic Expanding the Frontier: Agentic transformation in capital markets for deeper insights into the strategies shaping the future of capital markets.
• Watch Transforming Financial Services – Leaders in AI adoption and Innovation to see how leaders in capital markets are successfully using AI to transform complexity into opportunity.
• Get a practical transformation framework and see how Frontier Firms lead with agentic AI in our Becoming a Frontier Firm: AI in Financial Services e-book.
• Explore capital markets solutions and resources on Microsoft for Capital Markets.

The post How Frontier Firms use agentic AI to gain an edge in capital markets appeared first on Microsoft Industry Blogs.

Manufacturing is moving beyond local optimization toward a closed loop of end-to-end intelligent orchestration. Looking back at CES 2026, we can see that the industry narrative is quiet but fundamentally shifting. 

Across what we’re seeing with customers globally, three shifts stand out. First, the system shift. The operational foundation is evolving from digital to intelligent: more resilient, more real-time, and critically, more governable. Second, the data shift. The digital thread is no longer a static archive. It is becoming a living system—continuously updated and directly powering decisions as conditions change. Third, the work shift. We’re moving from copilots that assist individuals to agents that can collaborate and take on tasks—so the workflows themselves become more self-driving.

Together, these forces are raising the bar. Companies now need an end-to-end intelligent chain that turns AI from isolated point solutions into an organizational capability—reusable, scalable, and auditable. Drawing on Microsoft’s long-term work with manufacturers worldwide, and on how technology is evolving, I’d like to offer a practical framework for building that intelligent chain—so leaders can convert insight into action, and pilots into capabilities that scale.

AI use-case map for manufacturing: End-to-end intelligence from design to service

Scene One: Digital Engineering: Turning R&D into a profit engine

The role of the digital thread is evolving. Traditionally, it served primarily as a system of record—aggregating and archiving data. With AI and a unified data platform, it is becoming a real-time decision backbone spanning design, manufacturing, and service. Knowledge generated at one stage can now be applied immediately to improve outcomes in another. Generative and agentic AI are accelerating the core engineering loop—design, simulation, manufacturability analysis, and engineering change management—shortening iteration cycles and pushing risk discovery earlier in the process. Engineering data is no longer an R&D-only asset; it increasingly informs factory scheduling, quality strategies, maintenance policies, and service feedback loops.

This shift is already visible in practice. HARTING, a leader in industrial connectors, has deployed an AI assistant powered by Azure OpenAI and Microsoft Cloud for Manufacturing, making connector design faster, simpler, and more intuitive than ever before. Customers can describe their requirements in natural language, and the AI translates these inputs into technical specifications, guiding them to the right product within a minute. Customers can also visualize their configurations in 3D, enhancing confidence in their decisions. Siemens DI provides comprehensive cutting-edge software, hardware, and product lifecycle management solutions for industries including automotive and aerospace.

Using Microsoft Azure AI, Siemens DI developed a Microsoft Teams application for its industry-leading product lifecycle management (PLM) solution, Teamcenter. This solution analyzes unstructured voice content in multiple languages, automatically generates summary reports, and delivers information precisely to the relevant design, engineering, or manufacturing experts within Teamcenter. Through this intelligent collaboration mechanism, field issues are resolved faster, and knowledge transfer efficiency is significantly enhanced.

Scene Two: Intelligent Factory: AI is rewriting scheduling, quality, and maintenance

Production, maintenance, quality, and inventory remain the four core modules of factory operations—and that does not change in a smart‑factory context. What is changing is how these modules run. AI is systematically reshaping their operating logic: inventory management is moving from static rules to dynamic optimization based on real-time signals; quality management is shifting toward earlier, more precise judgments through computer vision, time‑series forecasting, and anomaly detection; and maintenance is evolving from after‑the‑fact repairs to predictive maintenance—progressing further toward adaptive process control.

As OT and IT capabilities mature, factories are gaining the ability to reason and respond directly at the point of value creation—on the shop floor, in real time. Frontline teams, empowered by multimodal Microsoft Copilot, can push the boundaries of what they can diagnose, decide, and execute. Over time, this human‑machine collaboration forms operational “agents” that can be deployed into production lines and day‑to‑day routines—turning intelligence into repeatable execution.

Global candy maker Mars operates manufacturing facilities across 124 locations worldwide. To safeguard its global equipment network, Mars partnered with Microsoft to deploy the Microsoft Defender for IoT solution. This enables visual management and threat detection for industrial equipment within stringent air-gapped production environments. Simultaneously, the solution transmits critical security data to a centralized system, enhancing data visibility while ensuring production continuity. International technology group Körber has transformed its market-leading PAS-X MES product into a cloud-based software as a service (SaaS) solution to address the stringent and multifaceted production management demands of the pharmaceutical sector. Using the robust stability of Microsoft Azure, Microsoft for Manufacturing, and Microsoft Azure Kubernetes Service, this solution enables customers to achieve greater flexibility and scalability. Simultaneously, by integrating data from IT and OT systems such as enterprise resource planning (ERP), supply chain management (SCM), and manufacturing execution system (MES), it delivers near real-time, actionable insights from diverse systems to employees. This significantly enhances equipment uptime, employee productivity, product quality, and overall output.

Scene Three: Resilient supply chain: From insight to execution with agentic AI

Early AI in supply chains mostly provided forecasts and dashboards. Valuable as they were, humans still needed to translate insights into action. The next step is agentic AI that executes—coordinating with suppliers, triggering replenishment or re-planning, optimizing inventory, and managing exceptions in logistics. When this happens, the traditional plan–execute–feedback loop transforms into a continuous intelligent system. The result is more than improved service levels—it enhances structural resilience and sustainability, as the system senses disruptions earlier, acts faster, and learns continuously.

A China-based electronics manufacturer, Xiaomi has built a unified after-sales supply chain management platform based on Microsoft Dynamics 365 and Microsoft Power Platform, using Azure for system integration and multilingual support. Utilizing Dynamics 365 Customer Service, Xiaomi has created a work platform that integrates financial processes, data integration, and security authentication across multiple communication channels. This platform also visualizes current inventory and proactively monitors and manages inventory levels in real time, enabling collaborative management between frontline services and backend supply chains. As a global leader in the smart terminal and home electronics industry, TCL is reshaping the industry landscape with its “Hardware + AI + Ecosystem” strategy, building a full-scenario ecosystem spanning multiple devices. Beyond driving innovative applications of Azure cloud and AI technologies in manufacturing, supply chains, and user experiences, TCL has pioneered the integration of Azure OpenAI, multimodal interaction, the intelligent Microsoft Copilot® assistant, and the Artificial Intelligence Generated Content (AIGC) ecosystem into smart TVs, smartphones, tablets, air conditioners, and other home appliances. This enables seamless cross-device connectivity and immersive experiences.

Scene Four: Connected customer: The product doesn’t end at delivery

In an AI-native model, product delivery is no longer the finish line. Customer experience continues through Over-the-Air (OTA) updates, AI-guided diagnostics, predictive service, and personal recommendations. AI enables a true closed loop—from customer feedback to engineering, factory, service, and back—turning experience into a growth driver rather than a cost center. None of this can scale without trust. As AI moves from recommendation to execution, governance becomes essential. Organizations need model governance, data and access control, OT and endpoint security, and explainability with rollback capabilities. This layer underpins all use cases, ensuring AI operates safely and reliably.

Epiroc, a Swedish mining and infrastructure equipment manufacturer, uses Microsoft Azure Machine Learning to build predictive maintenance and equipment performance models, transforming machine data into actionable customer insights. By identifying potential failures in advance and optimizing maintenance planning, Epiroc delivers a more proactive and transparent service experience, deepening customer relationships while opening new service-driven growth opportunities. Lenovo partnered with Microsoft to deploy the Microsoft Dynamics 365 Sales platform, thereby transforming its global customer relationship management (CRM) system.

By consolidating fragmented customer data and standardizing sales processes onto a unified digital platform, Lenovo achieved end-to-end visibility from lead management to opportunity tracking. The transformation improved collaboration efficiency, strengthened data-driven decision-making, and reinforced a more customer-centric operating model. In the “Hyper-Competition in High Dimensions” of the smart electric vehicle industry, NIO significantly boosts R&D efficiency by generating 610,000 lines of code daily through its intelligent GitHub Copilot® copilot, achieving an acceptance rate of up to 33%. The in-vehicle assistant NOMI, built on Azure OpenAI, enhances driving safety and user experience through precise contextual interaction. Simultaneously, Microsoft security solutions safeguard NIO’s complex IT environment and hybrid AI platform, automating daily threat detection and enabling cross-device security coordination.

Scene Five: Trust, safety, and OT security: The non-negotiable foundation

None of these AI use cases can scale without trust. Once AI moves from a recommendation system to an execution system, governance becomes essential. Manufacturing organizations need four core trust capabilities: model governance (ModelOps and Responsible AI), data and access control (Zero Trust architecture and industrial data protection,) OT and endpoint security, and explainability with controllability and rollback, so decisions can be understood, constrained, and safely reversed when needed. This is not a separate chapter; it forms the operating layer beneath all use cases, ensuring AI operates safely and reliably across the organization.

Ford, a longstanding automotive manufacturer synonymous with innovation, has deployed Microsoft solutions—including Microsoft Defender, Microsoft Sentinel, and Microsoft Purview—across its global operations. This initiative enhances visibility, automates responses, and strengthens data governance within its hybrid environment as companies worldwide face escalating cybersecurity threats. AI models learn from every interaction to improve detection capabilities and reduce false positives. With a unified security platform, Ford can focus on business strategy while reducing complexity and boosting operational efficiency. Smart pet device leader PETKIT is currently upgrading its systems on the Azure platform to achieve standardized device connectivity, telemetry data aggregation, and global compliance and security for users worldwide. Microsoft’s products and services not only enhance the company’s technological depth but also provide a cloud-plus-AI platform for global market replication.

2026: The inflection point when AI shifts from “more” to “different”

Once an end-to-end intelligent chain is in place, AI’s role inevitably shifts from offering advice to executing processes—and manufacturing moves from isolated efficiency gains toward full system redesign. In this sense, 2026 will be the year this transformation is proven on a scale. It will be a demanding moment for industry, but also a rare opportunity for leaders to make a true step change. This shift is becoming visible across several dimensions.

In 2026, AI in manufacturing will no longer exist as a collection of pilots. Instead, it will function as an enterprise nervous system—continuously sensing, learning, and coordinating decisions across functions. Organizations will move from experimenting with AI to running with AI, shifting from exploratory adoption to responsible, repeatable execution at scale.

Second, the ability to scale AI will become a key competitive differentiator. AI should not be confined to isolated applications but integrated into cross-departmental and cross-business collaboration to unlock its full potential. In other words, the gap between enterprises no longer lies in whether they deploy AI, but in their ability to achieve scalable implementation across the entire end-to-end value chain. Research from MIT and McKinsey suggests that leading enterprises can achieve up to four times the impact in half the time by building unified data and governance foundations.¹

Third, technical readiness will help define 2026. Edge inference, OT and IT integration, industrial networking, and model governance have matured to the point where AI can operate directly where value is created—on the plant floor, in real time, and within the flow of work. AI is moving beyond general content generation toward deep operational integration, spanning equipment, processes, quality, and logistics, and becoming an integral part of closed-loop industrial control.

Beyond technology, people, governance, and culture will emerge as true differentiators. In 2026, the primary constraint for many manufacturers will be organizational readiness—the ability to share data responsibly, collaborate across silos, and build AI literacy and operating rhythms that sustain change. Research on scaling AI highlights the “10–20–70 rule”: roughly 10% of success comes from algorithms, 20% from technology and data foundations, and 70% from people and processes.¹ Scaling AI effectively therefore requires building skills, accountability, and safety-and-governance capabilities in parallel with the technology itself.

Finally, the maturation of industry standards and ecosystems will accelerate broader AI adoption. Manufacturers face converging pressures—from geopolitics and cost to compliance and supply chain resilience. According to public records, 81% of manufacturers cite fear of falling behind as a primary driver of adoption.² The implication is clear: the question is no longer “Do we need AI?” but “Can we afford not to evolve?” As industrial data semantics, standardized APIs, reference architectures, and increasingly packaged solutions mature, time-to-value will shorten and complexity will fall—making AI feasible for a much broader set of manufacturers.

From insight to action: A 2026 checklist for manufacturing leaders

At this point, the question is no longer abstract: can your organization turn AI capabilities into sustainable, day-to-day operations—rather than pilots and demos? In conversations with manufacturers around the world, this question consistently separates leaders from laggards:

• Strategic clarity: Have you defined the core business problems AI must solve, beyond simply “adopting AI”?
• Data foundation: Can your data platform support real deployment, not just proof-of-concept results?
• Operational readiness: Are your factories and supply chains prepared for AI-powered routines in daily execution?
• Workforce capability: Does your workforce have the baseline skills to work effectively with AI systems?
• Ecosystem usage: Do your partners and platforms support continuous upgrades and rapid scaling?
• Governance and security: Is governance strong enough for AI to move from recommendation to execution?
• Resilience impact: Is AI measurably strengthening operational resilience?

We can already see the direction of travel toward the future. But trends alone do not create leaders. Execution does. The real differentiator will be who can turn AI from concept into action, from tool into capability, and ultimately from capability into resilience.

Advancing intelligent manufacturing with Microsoft

Manufacturing is entering a new phase—powered by actionable data, increasingly autonomous systems, and a more empowered workforce. Companies that unify their data, drive autonomy across planning and execution, and integrate the value chain through digital threads and digital twins will be best positioned to convert operational excellence and innovation into sustained growth.

Against this backdrop, Microsoft continues to work closely with manufacturers to expand what is possible across design, production, supply chain, and service. By combining cloud, data, and AI platforms that are advanced yet practical to deploy, we aim to help organizations build end-to-end intelligent operations—accelerating innovation while maintaining security, responsibility, and scale.

¹ KPMG, Intelligent manufacturing A blueprint for creating value through AI-driven transformation.

² businesswire, Ninety-Five Percent of Manufacturers Are Investing in AI to Navigate Uncertainty and Accelerate Smart Manufacturing, June 2023.

The post Manufacturing at the 2026 inflection point: How Frontier companies are entering the agentic era appeared first on Microsoft Industry Blogs.

Yet despite broad cloud adoption, migration and modernization remain complex. Legacy architectures, fragmented environments, and persistent skills gaps continue to slow progress, pushing organizations to find ways to migrate faster while minimizing operational risk. 

The IDC study highlights agentic AI as a critical unlock. These intelligent systems automate assessments, orchestrate migration and modernization efforts, and optimize operations across hybrid environments—helping organizations shift from periodic, manual initiatives to continuous, adaptive modernization. This momentum is driving unprecedented growth, with IDC forecasting the public cloud services market will reach USD1.9 trillion by 2029. 

While migration frameworks may be horizontal, their real-world impact is industry-specific. Healthcare, financial services, and manufacturing each face unique constraints shaped by regulation, operational risk, and mission-critical systems. 

In this blog, we explore the key migration and modernization challenges across these three industries—healthcare, manufacturing, and financial services—through real customer stories that highlight the tangible impact cloud adoption is delivering today.

Healthcare: Modernizing securely while powering next-generation clinical experiences

Healthcare faces the toughest modernization headwinds: strict regulations (HIPAA/HITECH, HITRUST), fragmented clinical data across electronic health records (EHRs) and imaging systems, aging on-premises infrastructure resulting in high Capex, and heightened exposure to ransomware.¹ Clinical environments also demand extremely low latency and high reliability.

The IDC study notes that these constraints slow modernization—but accelerate the need for it, as organizations push to scale telehealth, imaging workloads, genomics pipelines, and AI-powered clinical workflows.¹ 

What healthcare organizations need, according to the IDC study: 

• Secure, compliant integration across EHRs, picture archiving and communication systems (PACS), genomics systems, and Internet of Things (IoT) medical devices.¹
• Elastic compute for high-throughput imaging and genomics. 
• Stronger disaster recovery and recovery time performance.¹
• Ambient documentation and AI-supported diagnostics.
• Secure clinician collaboration and modern patient digital front doors.

Customer spotlight: Franciscan Health

Facing aging infrastructure and disaster recovery risks, Franciscan adopted a pragmatic workload placement strategy—moving its Epic EHR to Microsoft Azure.

The results included: 

• $45 million in savings over five years after migrating Epic to Azure.
• 90% faster disaster recovery compared to the prior environment.
• Around a 30-minute failover, reduced from hours.
• $10–$12 million per day in potential downtime risk avoided.

Learn more about Franciscan Health’s journey to migrate its Epic EHR to Azure.

Healthcare’s modernization mandate is clear: reduce operational risk, meet regulatory demands, and harness cloud AI to improve patient outcomes. 

Financial services: Enabling real-time intelligence and automated compliance

Financial institutions operate in one of the most regulated environments, including the payment card industry data security standard (PCI DSS), the Sarbanes-Oxley Act (SOX), the Gramm-Leach-Bliley Act (GLBA), Basel capital frameworks, and know your customer (KYC) and anti-money laundering (AML) requirements, and rely heavily on legacy mainframes that are difficult to modernize. Today, regulatory pressure is intensifying further as new frameworks such as the EU’s Digital Operational Resilience Act (DORA) and the EU AI Act raise the bar for operational resilience, third-party risk management, model transparency, and ongoing compliance monitoring. Under DORA, financial services firms must demonstrate continuous information and communication technology (ICT) risk management, advanced incident reporting, and resilience testing across critical systems and cloud service providers. Meanwhile, the EU AI Act introduces governance requirements for high-risk AI systems, including explainability, data lineage, human oversight, and auditability—with direct implications for fraud models, credit scoring, and customer decisioning platforms.

IDC interviews highlight accelerating demand for real-time risk analytics, fraud detection, digital onboarding, and infrastructure elasticity to support peak activity—capabilities that are increasingly mandated, not optional.¹

Key challenges the IDC study identifies: 

• Strict data residency, model risk governance, explainability, and eDiscovery requirements.¹
• Heightened expectations for operational resilience, cyber defense, and third-party risk oversight.
• Legacy systems and common business-oriented language (COBOL)-based batch processes resistant to change.
• Rapidly evolving regulatory mandates requiring continuous compliance rather than point-in-time audits.

Cloud—especially especially platform as a service (PaaS) and managed services—helps financial institutions shift from static, batch-driven compliance to continuous controls and real-time observability. By reducing batch windows from hours to minutes, modern cloud platforms enable real-time insights, automated evidence collection, resilient architectures, and policy-driven compliance workflows aligned with DORA and AI governance requirements.¹ Learn more about how Microsoft can help financial institutions navigate these requirements. 

Customer spotlight: Crediclub

To accelerate product innovation and meet expectations from Mexico’s national banking and securities commission (CNBV), Mexican fintech Crediclub modernized its databases to a serverless platform as a service (PaaS) architecture and adopted microservices.¹

The impact:

• Uptime improved from around 80% to 99.5%.
• 90% reduction in network latency through Multiprotocol Label Switching (MPLS) and dark fiber.
• Rapid deployment of new financial products via Kubernetes and DevSecOps.

For financial institutions, modernization is no longer just about efficiency—it is foundational to resilience, trustworthy AI, and regulatory compliance at scale. 

Manufacturing: Unifying IT and OT for predictive, data-driven industrial operations

Manufacturers operate in one of the most complex operating environments—defined by legacy and proprietary operational technology (OT) protocols, historically air-gapped manufacturing execution systems (MES) and supervisory control and data acquisition (SCADA) systems, and globally distributed supply chains. Stringent low-latency requirements for safety-critical systems, intermittent connectivity at the edge, and the need to protect intellectual property further compound the challenge. The ability to modernize and unify these environments—without compromising safety, reliability, or performance—represents a critical inflection point for industrial transformation.

Unique modernization challenges according to the IDC study:

• Ultra-low latency requirements for safety-critical operations.
• Massive telemetry ingestion and time-series analytics at scale.
• Operational complexity across global, distributed supply chains.
• Secure protection of intellectual property across edge and cloud environments.

Opportunities unlocked by cloud:

• Predictive maintenance with IoT ingestion.¹ 
• Reduced unplanned downtime and improved overall equipment effectiveness (OEE).
• Digital twins for plants, lines, and products.
• Computer vision for real-time quality and safety. 
• High-performance computing (HPC) simulations for engineering and design. 
• Standardized, global data models.

Customer spotlight: ASTEC Industries

ASTEC unified fragmented systems across its rock to road value chain—from aggregate processing through asphalt production and paving—by adopting Azure, modernizing to timeseries databases, and building a universal connectivity platform using Azure IoT Hub, Azure Events Hub, and Power BI.¹

The results:

• Realtime operational visibility across fleets.
• Predictive maintenance for reducing downtime.
• New digital services supported by connected equipment.

Manufacturing’s modernization imperative: unify OT and IT, scale real-time intelligence, and enable global efficiency. 

Microsoft’s approach: Continuous, intelligent, collaborative modernization 

Microsoft’s strategy is grounded in a simple principle: modernization should be continuous, intelligent, and collaborative. The IDC study emphasizes that successful enterprises adopt a balanced, multipath migration strategy, blending rehost, replatform, refactor, and software as a service (SaaS) substitution based on workload criticality.¹

Microsoft enables this approach through a comprehensive set of tools and offerings, including Azure Copilot and GitHub Copilot. Agentic automation enables:

• Discovery and dependency mapping.
• Security assessment and 6R recommendations.
• Application refactoring, code remediation, and modernization. 

Azure Migrate provides unified discovery, assessment, migration execution, and modernization services. Azure Accelerate complements this with a coordinated framework that includes:

• Guided deployments through Cloud Accelerate Factory.¹ 
• Funding and Azure credits for planning, pilot, and rollout. 
• Expert partners and tailored skilling programs.

The IDC study concludes that organizations using Microsoft Azure for migration and modernization achieve lower operational costs, improved resiliency, faster modernization timelines, and stronger security postures—especially in regulated industries.¹

Looking ahead: Agentic modernization as the foundation for AI-ready enterprises

Across all industries, IDC’s findings are consistent: agentic AI is emerging as the new force multiplier for modernization, enabling organizations to keep pace with rising complexity, regulatory demands, and competitive pressure. 

Healthcare, financial services, and manufacturing each face unique constraints—but cloud modernization remains the foundation for innovation, operational excellence, and enterprise AI. 

Microsoft’s approach gives organizations the unified automation, intelligence, and tooling they need to modernize securely and at scale. 

• Explore how Azure Copilot accelerates cloud migration.
• Discover GitHub Copilot for app modernization.
• See how Azure Accelerate supports transformation.

¹ IDC White Paper, Cloud Migration and Modernization Strategies for Healthcare, Financial Services, and Manufacturing, February 2026.

The post Modernizing regulated industries with cloud and agentic AI appeared first on Microsoft Industry Blogs.

Research we conducted with senior healthcare executives in the United States, published in the New England Journal of Medicine, revealed a growing readiness divide. As some systems build governance, security, and workforce models to scale AI safely, others are still in proof-of-concept mode. The result? Diverging outcomes in productivity, workforce strain, cost-to-serve, and resilience.

The question is no longer whether AI belongs in healthcare. It’s how quickly organizations can operationalize it—safely, responsibly, and at scale.

Microsoft works with more than 170,000 healthcare customers globally to move from pilot to production with enterprise-grade security, privacy, and compliance.

So what does Frontier Transformation actually look like? The following examples show how healthcare organizations are embedding AI into core workflows—moving beyond pilots to deliver real, scalable impact with the governance and trust required in clinical environments.

Accelerating discovery and clinical development with AI

Frontier organizations are reinventing discovery by treating AI as an always-on research partner. It compresses the time it takes to find, synthesize, and act on evidence across functions. The result isn’t just faster tasks; it’s faster decisions and a more scalable path from insight to impact. As these capabilities become table stakes, organizations that can’t industrialize knowledge of work will fall behind in speed-to-trial, speed-to-market, and ultimately speed-to-patient.

UCB: Scaling agent-based AI with a secure internal platform

UCB built SKAI, a secure internal platform on Microsoft Azure for generative and agent-based AI, helping teams apply knowledge faster and operationalize AI with governance built in.

Syneos Health: Streamlining complex data to bring therapies to patients faster

Syneos Health is using AI to help teams analyze large, complex data sets across the clinical development lifecycle. With faster, more consistent synthesis of study inputs and operational signals, biopharma customers can make decisions with greater speed and confidence. Syneos Health reported reducing time for clinical trial site activation by about 10%, helping remove friction from a critical step in getting lifesaving therapies to patients. Enhanced predictive modeling and forecasting tools also allow teams to identify risks earlier, model scenarios, and engage customers and clinical partners more effectively.

Advancing care delivery with AI in the flow of clinical work

In care delivery, transformation happens when AI shows up in the flow of work. It reduces cognitive and documentation load and gives time back to clinicians. Frontier organizations use AI to shift capacity toward patients, not screens, while improving consistency and quality. As patient expectations rise and workforce shortages persist, the ability to deliver more care with the same (or fewer) resources is quickly becoming a differentiator.

Intermountain Health: Rehumanizing care by reducing documentation burden

Intermountain Health adopted Microsoft Dragon Copilot to reduce the administrative load that can pull clinicians away from patients. By supporting clinical documentation and automating routine tasks, clinicians at Intermountain Health reported experiencing a 27% reduction in time spent on notes per appointment, reducing cognitive burden and enabling more meaningful patient engagement by incorporating AI as a core part of their clinical workflow.

Cooper University Health Care: Giving clinicians time back in the flow of care 

Cooper University Health Care is using AI-powered clinical documentation to reduce the administrative burden that pulls clinicians away from patients. By embedding AI directly into clinical workflows, clinicians at Cooper reported saving more than four minutes per patient visit on documentation, experiencing less burnout, and engaging more meaningfully with patients—demonstrating how AI optimized workflows can rehumanize care at scale.

Mercy: Bringing ambient AI to nursing workflows

Nurses are at the center of care delivery and often at the center of documentation burden. Mercy has been using AI capabilities to transform nursing care. By capturing and structuring information in the flow of work, Mercy reported 8 to 24 minutes saved per shift for high-use nurses, a 21% reduction in documentation latency and a 4.5% increase in patient satisfaction from their initial rollout.

Streamlining operations and experiences across the healthcare organization

Frontier Transformation requires more than point solutions. It takes an AI-ready operating foundation that connects people, processes, and data across the organization. Frontier organizations use copilots and agents to standardize work, automate routine interactions, and deliver more consistent experiences at scale. Those that treat AI as isolated experiments often find themselves outpaced by peers who can improve service levels while bending the cost curve.

Bupa APAC: Building an AI-ready foundation to improve customer experiences

Bupa APAC is streamlining operations, automating routine processes, and making customer experiences more seamless thanks to AI. With an emphasis on AI readiness—skills, governance, and secure access to information—Bupa APAC upskilled its workforce with Microsoft 365 Copilot and GitHub Copilot, generating more than 410,000 lines of AI-assisted code, initiating more than 30,000 Copilot chats, and accelerating more than 100 AI use cases to improve care.

CareSource: Scaling compassionate service with cloud and AI

CareSource is applying AI to support operational scale while keeping a human touch. By modernizing platforms and automating processes that can slow service delivery, CareSource reduced documentation time by 75%, saved over USD125,000 on automation, and boosted developer productivity by up to 30%, helping their teams focus on the needs of members, providers, and communities.

Strengthening cyber resilience with AI

Cyber resilience is a transformation prerequisite. As care becomes more digital, AI must help defenders move at machine speed while maintaining trust and compliance. Frontier organizations use AI to triage, investigate, and report faster—reducing risk and freeing experts for the threats that matter most. In a sector where disruption can compromise patient safety, lagging security maturity can erase hard-won gains in digital transformation.

St. Luke’s University Health Network: Saving nearly 200 hours per month with AI-powered security agents

As healthcare expands its digital footprint, cyber defense becomes inseparable from patient safety and trust. St. Luke’s University Health Network is using Microsoft Security Copilot agents to accelerate phishing alert triage and to generate incident reports in minutes instead of hours. The organization reported saving nearly 200 hours per month, freeing security teams to focus on higher-value investigations and improving speed to response across its environment.

Act now to lead the future

If you’re looking at these examples and wondering where to start, focus on a few moves that help you learn quickly and scale safely.

• Start with workflows, not technology: Identify the highest-friction moments (such as documentation, imaging backlogs, complex data synthesis, member service, and security triage) and design AI interventions that measurably reduce time, effort, and risk.
• Get your foundation right, early: Prioritize secure access, identity, and data governance so copilots and agents have the right context, without compromising privacy or compliance.
• Make it real, and make it stick: Operationalize responsible AI (like oversight, evaluation, and human-in-the-loop), measure quality and safety, and invest in change management so adoption scales beyond early enthusiasts.

Start your Frontier Transformation today

These organizations show what Frontier Transformation looks like in practice—embedding intelligence across clinical, operational, and administrative work to deliver faster insights, reduced burden, strengthen security, and create better experiences at scale. The competitive bar is moving quickly. Waiting to act can mean higher costs, slower throughput, and greater strain on already-stretched teams. With deep healthcare experience and a global customer base, Microsoft can help organizations scale AI responsibly from the first workflow to redesign to enterprise-wide adoption.

The post What Frontier healthcare leaders are doing differently with AI appeared first on Microsoft Industry Blogs.

New capabilities include the ability to surface relevant work-related information alongside patient data for customers using Microsoft 365 Copilot; partner-built AI apps and agents available through Microsoft Marketplace that extend intelligence across revenue cycle, clinical insights, and decision support; and expanded role-based experiences for physicians, nurses, and radiologists designed to scale securely across settings and geographies.

Today, more than 100,000 clinicians rely on Dragon Copilot as part of their daily practice—supporting care for millions of patients every month. That kind of adoption doesn’t happen by accident; it happens when technology earns trust, fits naturally into clinical workflows, and proves its value day after day. As healthcare continues to accelerate, the question facing organizations is no longer if AI will be part of care delivery, but how quickly they can equip their teams with tools that scale safely, work across roles, and keep clinicians focused on patients. The new Dragon Copilot capabilities we’re introducing at HIMSS 2026 build on this proven foundation—extending trusted clinical support beyond documentation to meet the growing demands of modern care.

Clinicians need more than access to data—they need an AI assistant that works alongside them, understands context, and supports action across systems and settings. Built on Microsoft Azure, Dragon Copilot delivers this capability with enterprise‑grade security, responsible AI, and cloud scale—giving organizations the confidence to deploy broadly and grow with care teams wherever they work.

“We ultimately went with Microsoft because of the security, the compliance, the scalability, and the fact that they’ve delivered reliable solutions for years.”

—Snehal Gandhi, MD, Vice President and Chief Medical Information Officer, Cooper University Health Care

See what Dragon Copilot has to offer:

Unifying the disparate—so care teams can move faster, with confidence

By unifying information from across systems and sources, Dragon Copilot reduces fragmentation and unnecessary searching—bringing patient data, trusted clinical content, and partner powered AI insights into a single, contextual experience within the clinical workflow.

What makes this approach different is not just access to information, but how intelligence is delivered and applied. Clinicians can naturally query, summarize, create, and act using voice or text—without toggling between tools. Insights are surfaced instantly in one place, enabling care teams to move fluidly from understanding to action while spending less time navigating systems and more time with patients.

That intelligence is grounded in a broad set of trusted sources, including:

• Prebuilt trusted clinical content with citations
• Patient data like diagnoses, labs, medications, and allergies
• Organizational content such as policies, procedures, schedules, and communications

When needed, reliable web information can also be accessed through a safety‑first pathway—ensuring responses remain appropriate for clinical use.

Care delivery depends on more than clinical facts—it also depends on fast access to the work context around care. With Microsoft 365 Copilot, powered by Work IQ and accessible inside Dragon Copilot, clinicians can pull in relevant work-related information from connected apps and enterprise data, right where they’re already working. Work IQ is the intelligence layer that helps Copilot understand how people collaborate across emails, files, meetings, and chats—so responses are grounded in the right context. The result is a more unified experience that reduces time spent searching across tools and keeps momentum inside the clinical workflow.

Dragon Copilot extends clinical intelligence beyond any single system or screen. Instead of being locked into one interface, clinicians can invoke powerful AI capabilities wherever they’re already working—across applications, EHRs, and web pages. By simply clicking or highlighting text, Dragon Copilot can read, understand, and apply its intelligence directly in context, without forcing clinicians to switch tools or reenter information.

For example, a clinician reviewing a note can place their cursor over a sentence and say, “Add more detail about what the patient shared regarding their cardiac history.” Dragon Copilot immediately expands the documentation using the surrounding clinical context—no copying, no pasting, and no workflow disruption—helping clinicians move faster while keeping their focus on the patient, not the screen.

Building on this foundation, Dragon Copilot further unifies innovation through AI apps and agents available in Microsoft Marketplace. Developed by partners such as Canary Speech, Humata Health, Optum, and Regard, these solutions deliver capabilities across clinical insights, revenue cycle management, prior authorization, and clinical decision support. Organizations can easily purchase, deploy, and scale partner innovation—while clinicians experience those insights directly within their existing workflows.

“Sentara Health is integrating Regard’s diagnosis and documentation technology within Dragon Copilot to save time, improve revenue integrity, and most importantly improve care.

By combining Dragon’s ambient conversation capture with Regard’s ability to surface key insights from data, we expect to help our clinicians identify comorbidities and relevant diagnoses in real time without adding steps to their workflow. Our goal is straightforward: strengthen the clinical picture, reduce documentation burden, and support more informed decision-making at the point of care.”

—Dr. Joseph Evans, Vice President, Chief Health Information Officer at Sentara Health

Simplifying the complex—so care teams can be present with patients

Dragon Copilot streamlines clinical documentation and routine tasks, so clinicians spend less time navigating systems and more time focused on patient care. By simplifying physician and nursing charting, notes, flowsheets, and radiology reporting, it reduces rework and cognitive burden—helping care teams work more efficiently and confidently across the day.

This simplification is powered by healthcare-grade AI models built for clinical accuracy, with clinical note quality evaluated using the Provider Document Summarization Quality Instrument (PDSQI9)—an industry standard developed with leading academic and healthcare institutions to ensure clear, consistent, and clinically appropriate outputs.

Beyond documentation, Dragon Copilot automates high friction tasks across the workflow. Persona specific note types, automated referral letters and after‑visit summaries, summaries of prior radiology reports, and proactive coding guidance reduce manual effort and unnecessary toggling—allowing care teams to focus on decisions, not data entry.

New and expanded capabilities include:

• Proactive ICD‑10 specificity suggestions, delivered during note review to support timely, accurate reimbursement.
• Reusable custom clinical documents, created from prompts or examples and managed as templates, allowing clinicians to get additional unique content created automatically, such as custom letters.
• Pull-forward workflow support to jump-start new documentation from prior notes.
• Multilingual conversation capture, connecting with patients in their language. Captures the conversation in 58 languages and automatically converts the encounter into a note written in the primary language used in each country.
• Seamless migration from Dragon Medical One, preserving existing commands, vocabularies, profiles, templates, and AutoTexts.

Scaling across roles, geographies, and devices

Dragon Copilot is designed with role-based experiences that deliver the right capabilities to each clinician, when and where they’re needed. Physicians, nurses, radiologists, and other care team members benefit from workflows tailored to their unique responsibilities—from documentation and care coordination to image interpretation—while organizations maintain consistency, security, and compliance at scale. With a single solution spanning multiple roles, including the only experience built for radiologists and demonstrated outcomes for nurses, healthcare organizations can simplify their technology footprint and drive greater return on investment.

Physicians

Dragon Copilot supports physicians across care settings through EHR‑integrated workflows and a dedicated app available on mobile (iOS and Android), web, and desktop. Physicians can document more efficiently, access timely clinical information, and reduce cognitive load—whether at the point of care or on the go.

Together with partners, Dragon Copilot continues to scale globally and is now available in U.S., Canada, the UK, Ireland, France, Germany, Austria, Belgium, and the Netherlands.

Nurses

Dragon Copilot enhances nursing workflows by ambiently capturing documentation at the point of care and transforming conversations into structured flowsheet entries. With expanded support for all med-surg flowsheet templates and lines, drains, and airways (LDAWs) additions and removals—nurses can document more completely without disrupting care.

Through a dedicated app available on mobile (such as iOS and Android), web, and desktop, nurses can also access information from trusted medical sources, query transcripts to surface key patient details, and create concise summaries—without leaving their workflow—reducing clicks, and keeping focus on patient care.

“Dragon Copilot gives power back to nurses to spend time at the bedside with face-to-face interactions.”

—Stephanie Whitaker, MSN, Registered Nurse, Chief Nursing Officer, Mercy

Nurses using Dragon Copilot have reported reduced cognitive load, faster documentation, and improved patient experience, reinforcing the value of role‑specific AI designed for frontline care. The Dragon Copilot nursing experience is available in the United States.

“I can say that without a doubt, using Dragon Copilot has significantly reduced the time that I’m focused and worrying about sitting down and getting my charting done behind the computer.”

—Christine Dupire, Registered Nurse, Mercy

Radiologists

Paired with PowerScribe One, Dragon Copilot helps minimize repetitive tasks such as reviewing prior reports and automates routine steps in report creation. It surfaces relevant clinical context, integrates customizable AI experiences, and provides intelligent access to credible information—helping radiologists stay focused and deliver high‑quality reports with confidence. The Dragon Copilot radiology experience is currently in preview in the United States.

“As we embrace the next frontier of AI, we know that having cloud-based solutions that work seamlessly with our existing products and systems is paramount. Having Dragon Copilot as a companion for PowerScribe One gives me confidence that I can test and benefit from the latest AI advancements with minimal disruptions and distractions.”

—Sean Cleary, MD, Vice Chair of Informatics for Imaging Sciences University of Rochester Medical Center

Restoring humanity to healthcare through AI

AI will only transform healthcare if it truly serves the people delivering care. Dragon Copilot is built for that purpose—bringing role‑based experiences, hands‑free workflows, and proactive clinical intelligence together in a way that fits naturally into how clinicians work. By unifying information, reducing friction, and extending trusted intelligence across the workflow, Dragon Copilot helps clinicians spend less time managing tasks and more time connecting with patients—restoring focus, confidence, and humanity to the practice of medicine.

Join the more than 100,000 clinicians already using Dragon Copilot

• Visit us at the HIMSS 2026 Booth #2812.
• Get the playbook to learn how clinicians utilize AI to work smarter.
• Download the white paper to explore AI use cases transforming healthcare.

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