To help answer these questions, Microsoft leaders and industry partners will showcase the very latest AI innovation for manufacturers designed to help address today’s most critical challenges.

Dynamics 365 ERP solutions

Infuse AI across business processes and workflows.

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AI agents will transform manufacturing in 2025 and beyond

Moving forward, four transformative trends will set the pace of growth and success in the evolving manufacturing landscape:

• Improving supply chain operations
• Driving operational excellence with operational technology data from siloed sources
• Delivering great customer experience
• Increasing energy efficiency and employee productivity

At the Microsoft expo booth, manufacturers will learn how they can achieve these trends by using agents across critical business processes and workflows with Microsoft Dynamics 365 autonomous ERP solutions.

Improving supply chain operations with AI agents

Manufacturers face increasing supply chain challenges, from fluctuating customer demand to geopolitical uncertainties that can pressure organizations to restructure supply chains or reshore operations to unaffected regions. It’s imperative to have the agility to adapt to rapid demand shifts while operating profitably and keeping costs in check.

AI agents can play a crucial role in manufacturing operations, autonomously monitoring processes for potential disruptions, with the ability to proactively mitigate potential issues before they’re serious issues.

The Supplier Communications Agent in Dynamics 365 autonomously manages interactions with vendors and suppliers to help ensure on-time delivery of purchase orders helping to avoid downstream delays to customers. The agent provides visibility into the supplier’s supply chain and allows teams to spend more time improving supplier relationships and negotiating better contracts, rather than firefighting shortages.

Lifetime Products—a global manufacturer of products ranging from basketball hoops to picnic tables, sheds, and kayaks—depends on Microsoft Dynamics 365 Supply Chain Management to optimize operational capabilities. In addition to handling logistics and supply chain management more effectively, the manufacturer is implementing AI agents to “rebalance” its knowledge workforce to do more with same and be more efficient rather than reduce labor.

“One of our biggest learnings has been to let the autonomous agent run its own calculations. You’ll get a more comprehensive, better result.”

—Sinahi Lopez, Global IT Functional Manager at Lifetime Products

The company is now preparing to deploy the Supplier Communications Agent in Dynamics 365, to autonomously communicate with suppliers to proactively mitigate order delays and supply chain disruptions.

Based on study with IDC, $3.5 million in annual inventory-related cost savings using Dynamics 365, optimizing working capital​.¹

Achieving operational excellence with operational technology data from various silos

To stay competitive, manufacturers need to optimize operations by reducing costs, minimizing downtime, improving agility, and ensuring efficient production. This requires data-driven decision making that takes advantage of the industrial Internet of Things (IoT), AI-driven automation, integrated data clouds, and edge-to-cloud architectures to enable real-time insights, predictive maintenance, and quality control. Microsoft Dynamics 365 includes applications to manage finance, supply chain, sales, and customer relationships, designed to unify business data, improve efficiency, and simplify decision-making. The applications work seamlessly with Microsoft 365, which enhances productivity and collaboration with leading applications like Word, Excel, and Microsoft Teams, while Azure provides cloud infrastructure and IoT capabilities.

A key innovation is the AI agent, powered by Microsoft Copilot Studio, that automates tasks and streamlines workflows, securely grounded on data sourced from various systems by using Microsoft Dataverse as a central hub. Microsoft Fabric enhances analytics, helping businesses turn data into insights. For customization, Microsoft Power Platform offers low-code tools to build apps and automate processes, while Microsoft AppSource provides industry-specific solutions from Microsoft partners.

Together, these technologies create a connected ecosystem, reducing data silos and enabling businesses to operate more efficiently. With everything working seamlessly, organizations can focus on growth, innovation, and smarter decision-making.

Enerjisa Üretim, Türkiye’s largest private electricity generation company, replaced its legacy asset management system with Dynamics 365—a modern, user-friendly solution that provides end-to-end lifecycle management of all 312,500 assets across 29 power plants.

The organization is also transforming operations with Dynamics 365 and Azure, achieving efficiency, cost reduction, and workforce empowerment. Integration of asset management, IoT, and Microsoft Azure Digital Twins provides real-time insights for predictive maintenance. Unified systems improve data consistency, streamline workflows, and enhance collaboration, setting new standards for operational excellence in energy.

“Our equipment data is the key to operational efficiency. The Asset Management [capabilities] in Dynamics 365 extends the lifespan of critical infrastructure. By leveraging real-time data and advanced analytics, we can predict equipment failures before they happen.”

—Alper Serçe, Deputy General Manager, Enerjisa Üretim

Dynamics 365 integrates seamlessly with Enerjisa Üretim’s external systems like SAP, streamlining operations and enhancing efficiency. Real-time inventory updates from SAP into Dynamics 365 helps ensures that technicians have the right materials. And integration with HRweb and Yüklenici Entegre Sistemi (YES) optimizes resource allocation, matching skills and qualifications to work orders.

Based on study with IDC, 85% reduction in unplanned asset downtime using Dynamics 365, ensuring smoother operations​.¹

Deliver better customer experiences

Manufacturers are facing intense global competition, making customer experience essential to maintain relevance. To differentiate and retain customer trust, they must reconsider traditional business models and explore new revenue streams like product-as-a-service and aftermarket services.

Dynamics 365 assists manufacturers in transitioning to a product-as-a-service (PaaS) model by integrating IoT, AI, automation, and flexible financial frameworks.

• Dynamics 365 Supply Chain Management and Microsoft Azure IoT enable real-time product performance monitoring and predictive maintenance, reducing downtime, helping to ensure timely spare parts delivery and streamlined logistics, which are important for service-based models.
• Microsoft Dynamics 365 Field Service uses AI and IoT data for a predictive service model, enhancing efficiency and optimizing service contracts to improve customer satisfaction.
• Microsoft Dynamics 365 Finance supports flexible pricing, pay-per-use, and subscription models, converting products into ongoing services.

Hobart Corporation, a provider of commercial food equipment, needed to modernize its field operations to better support nearly 400,000 customers across the United States and Canada and solve inefficiencies in service delivery.

By adopting Microsoft Dynamics 365 Customer Service and Field Service, Hobart standardized processes, improved dispatch accuracy, and provided field technicians with mobile access to real-time inventory and customer data. This transformation enabled quicker response times, improved first-time fix rates, and better parts availability. The solution also facilitated predictive maintenance, ensuring proactive issue resolution before failures occurred.

As a result, Hobart significantly enhanced operational efficiency, customer satisfaction, and workforce productivity, reinforcing its reputation for high-quality service.

Organizations facing similar issues can also use the recently announced Scheduling Operations Agent (SOA) for Dynamics 365 Field Service, now in preview. This AI agent creates optimized schedules for technicians, even as conditions change throughout the workday. Whether it’s traffic delays, double bookings, or last-minute cancellations, the SOA helps ensure that schedules remain efficient.

The SOA uses advanced algorithms to address common scheduling challenges. By considering factors such as technician skill sets, territories, and promised time windows, the SOA maximizes technician utilization and prioritizes work orders effectively. This enhances productivity and helps ensure that customer commitments are met accurately.

Based on study with IDC, 40% faster order and product delivery times using Dynamics 365, increasing customer satisfaction.¹

Operating sustainably by driving energy and employee efficiencies

Manufacturers are under increasing pressure to improve energy efficiency and reduce their carbon footprint while maintaining productivity. By integrating Microsoft Dynamics 365 ERP solutions and Sustainability Manager in Microsoft Cloud for Sustainability, manufacturers can gain real-time visibility, AI-driven insights, and automated tracking to drive sustainability at scale.

Dynamics 365 ERP collects energy consumption data from IoT sensors, smart meters, and production systems, offering a comprehensive view of energy usage across facilities. This data flows into Microsoft Sustainability Manager, where AI-powered analytics identify inefficiencies, benchmark performance, and recommend optimizations. Manufacturers can track carbon emissions in real time, ensuring they meet sustainability targets.

With predictive analytics and AI-driven workload balancing, manufacturers can optimize machine usage, reduce energy waste, and lower costs. Additionally, optimized supply chain operations help minimize environmental impact through smarter logistics and material sourcing.

Camfil, a leading manufacturer of premium clean air filtration solutions, is using Dynamics 365 to enhance sustainability and profitability. By implementing Dynamics 365 with a standardized data model, Camfil has harmonized its processes across more than 30 production facilities and nearly 6,000 employees.

The integration of Dynamics 365 Finance, Dynamics 365 Supply Chain Management, Dynamics 365 Project Operations, Dynamics 365 Customer Service, and Dynamics 365 Sales has improved operations such as ordering, manufacturing, warehousing, shipping, and invoicing. This harmonization enabled by Dynamics 365 has led to better resource utilization, improved energy efficiency, a more connected and collaborative culture, and enhanced customer satisfaction through continuous innovation in air filtration systems—all contributing to a more sustainable and cost-effective manufacturing operation.

A well-empowered workforce can better manage inventory, demand planning, and supplier interactions, reducing waste and inefficiencies.

Based on study with IDC, 27% more manufacturing processes automated, 20% improvement of productivity across supply chain, procurement, and inventory management teams by using Dynamics 365 AI-powered ERP solutions.¹

Future-proof your manufacturing operations in 2025 

AI-powered solutions for ERP and service systems are more than a technological upgrade. They’re a strategic imperative for manufacturers aiming to improve the supply chain, drive operational excellence on the factory floor, deliver great customer experience, and operate sustainably and efficiently.

If you’re registered for Hannover Messe, we invite you to visit the Microsoft booth (#G06, hall 17) and join Sameer Verma, Microsoft’s GM, Dynamics 365 AI ERP, to learn how Dynamics 365 drives manufacturing excellence with AI agents. The session will take place on Monday, March 31, 2025, at 12 PM Central European Time (UTC +1).

Also, continue to visit the Dynamics 365 blog to learn more about how Dynamics 365 and Microsoft Power Platform are helping retailers reimagine the road ahead; and feel free to contact us to learn more about the Dynamics 365 AI-powered ERP system solutions. 

Source

¹ IDC White Paper, sponsored by Microsoft, The Business Value of Microsoft Dynamics 365 for Manufacturers, doc #US53226425

The post The future of manufacturing with Microsoft Dynamics 365 is here—are you ready? appeared first on Microsoft Industry Blogs.

Now, the focus is starting to shift. Productivity gains are just the beginning of a broader transformation—one that goes beyond efficiency to reshape industry processes, decision-making, and customer experiences.

True AI transformation requires an industry perspective

In our conversations with customers, many are asking about the next wave of AI. They’re ready to expand beyond general AI applications and invest in solutions tailored to their specific challenges. While organizations recognize AI’s value and potential, it must address industry-specific needs to deliver the biggest results. 

Take healthcare, for example, where engaging with patients requires sensitivity, data privacy, and personalized care. That’s very different from retail, where personalization is all about tailored shopping recommendations and seamless experiences.

The same contrast exists in manufacturing and transportation. Manufacturers focus on optimizing production lines for efficiency and quality, while fleet operations prioritize logistics, route optimization, and fuel costs.

These differences show why AI adoption is moving beyond general-purpose tools to industry-specific solutions that drive even greater impact. In our recent video series on the Return on Investment (ROI) of AI, we explore this trend, real-world use cases, and how AI is transforming industries like financial services and retail. These insights reflect what I’m seeing in conversations with customers about the changing AI landscape.

Where to invest in AI for maximum impact

Today’s leaders are looking beyond AI for productivity and asking a bigger question: Where should we invest next to drive business growth? The key is to align AI investments with mission-critical priorities.

So, is the AI for industry buzz real, and is it worth the investment? The answer is yes—here’s why:

• Industry-specific AI solutions tackle complex challenges—such as regulatory compliance in financial services, seamless omnichannel shopping experiences in retail, and asset troubleshooting in manufacturing.  At Microsoft, we’ve worked with thousands of customers to identify industry use cases where AI delivers meaningful business results. Building on these insights, we offer customizable AI agents designed to accelerate time to value for our customers.
• Customizable AI agents in Microsoft Copilot Studio help businesses tailor AI to their needs. Agent Builder, a feature within Copilot Studio, simplifies customization with industry-specific knowledge and low-code tools. In addition, our customers have access to a wide range of adapted AI models to accurately and effectively address their unique needs.
• AI models, developed in collaboration with partners, and built for specific industries make adoption easier across every sector and region. These fine-tuned models are trained on industry data to support business-critical use cases.

To see industry-specific AI in action, let’s explore key use cases in financial services, retail, manufacturing, and healthcare.

Driving growth in financial services with AI

Financial services organizations are leading the way in AI adoption, and it’s paying off. They’re realizing a 4.2 times average ROI on generative AI initiatives¹—the highest across industries. Discover how PicPay uses Microsoft AI to answer product and service questions quickly and securely.

Key use cases for AI in finance industry include:

• Banking: AI enhances customer interactions, improves fraud detection, and streamlines meeting preparation.
• Insurance: AI speeds claims processing and resolution, identifies upsell opportunities, and improves customer engagement.
• Capital markets: AI personalizes client presentations, generates predictive insights, and accelerates research.

Watch the video to explore AI business transformation in financial services.

Retailers solve complex challenges with AI

Retailers are realizing a 3.6 times ROI on generative AI initiatives,² and some are tackling customer acquisition, profitability, supply chain reliability, and data complexity. Learn how ASOS, a British online fashion retailer, uses Azure AI Foundry to surprise and delight young fashion lovers with engaging, inspirational experiences.

Key use cases for AI in retail industry include:

• Personalized Shopping Agent engages in natural language conversations, delivering tailored recommendations and assisting with specific requests.
• Store Operations Agent integrates product search, inventory, orders, omnichannel pricing, and incident management into existing applications.
• AI-powered insights help retailers create targeted marketing campaigns that boost engagement and increase sales. See how Microsoft Cloud for Retail connects customers, employees, and data.

Watch the video to see why the retail industry is embracing AI.

How AI powers smarter manufacturing

Manufacturers are achieving a 3.4 times ROI on generative AI initiatives.³ They’re also using AI to speed time to market, streamline application lifecycle management, and simplify manufacturing processes. See how Schneider Electric addresses the company’s most pressing issues by innovating with Azure OpenAI Service.

Key use cases for AI in manufacturing industry include:

• AI-powered generative design accelerates product development by automating design processes, refining models in real time, and freeing teams to focus on manufacturability and compliance.
• AI-assisted coding helps developers write, debug, and optimize code faster, enhancing industrial software development and connected product functionality.
• AI-powered factory insights provide real-time data for root cause analysis, production loss reduction, and asset maintenance, boosting efficiency and safety.

Learn more about Microsoft technology in the manufacturing industry.

AI helps empower the healthcare workforce and enhance patient care

In healthcare, AI is transforming medical data management, personalizing clinician and patient experiences, and helping to improve patient outcomes—delivering a 3.3 times ROI on generative AI initiatives.⁴ See how AI innovation empowers healthcare teams to refocus on the clinician-patient connection at Northwestern Medicine, Overlake Medical Center & Clinics, and Atrium Health.

Key AI use cases for healthcare include:

• AI assistants help streamline clinical documentation, surface information, and automate tasks to improve efficiency, satisfaction, and patient care.
• Advanced healthcare AI models are designed to enhance disease detection, diagnostics, and treatment planning.
• Multimodal AI generates insights from unified healthcare data to identify care gaps faster for early intervention, develop more tailored care plans, improve the accuracy of diagnoses, and allocate hospital resources more effectively.

We’re here to help you drive AI success

Organizations that invest in industry-focused AI applications and stay current with AI industry trends are realizing the greatest ROI with AI. We’re here to help you take action now and position your business for innovation, efficiency, and competitive advantage.

Watch the ROI of AI video series to learn more about AI ROI.

^{1, 2, 3, 4} IDC InfoBrief: sponsored by Microsoft, 2024 Business Opportunity of AI, IDC #US52699124, November 2024.

The post Beyond productivity: How industry-specific AI fuels growth appeared first on Microsoft Industry Blogs.

Agility helps retail and consumer goods supply chains:

• Quickly switch suppliers, develop more flexible sourcing strategies, and mitigate disruptions from potential tariffs¹
• Adapt product offerings and pricing strategies to combat the lingering effects of inflation
• Adopt more real-time demand forecasting tools and flexible warehousing solutions to keep up with shopping patterns
• Augment human labor with automation to improve productivity and address labor shortages

Retail and consumer goods organizations that develop greater agility will catapult themselves forward by using insights from their supply chains as a critical enabler.

Nonetheless, many retailers’ supply chains struggle with agility because warehouse data is often still on-premises—and that’s holding them back from the latest technologies. Because data is central to all business processes, it’s data that either fuels or inhibits supply chain growth. Reliance on on-premises data and legacy systems likely inhibits supply chain growth because it:

• Causes latency that slows decision-making since leaders lack access to real-time data and often rely on outdated snapshots of old data
• Prevents visibility and collaboration since data is often fragmented and siloed
• Limits scale because systems can’t efficiently process increased data volumes and fluctuating demand
• Impedes flexibility when systems can’t adapt quickly to shifting market conditions and demand
• Impairs adoption of new technologies and processes when existing platforms aren’t adaptable

The warehouse is the ideal starting place for increased digitalization because investments made at the warehouse create value that extends to other parts of the supply chain and enterprise.

Digitalizing the warehouse enables operational excellence and innovation through:

• Data-driven decision-making through real-time insights that help managers make more informed decisions and get teams unified around the same information so retailers can get ahead of demand.
• Reduced operating costs related to warehousing operations through enhanced efficiencies gained by automation and robotics—and improved warehouse throughput through layout optimization, labor efficiencies, and automation. This includes reduced time and labor required for tasks such as picking, packing, and shipping.
• Seamless integration throughout supply chain systems, such as enterprise resource planning (ERP) and warehouse management systems. It also sets the stage for other powerful capabilities, such as intelligent stores.
• More scalability, making it easier for retailers to handle seasonal demand fluctuations or rapid growth without disrupting operations.

Agility helps supply chain leaders drive operational excellence and innovation. Nothing enables that level of agility like the cloud. Here are three compelling reasons to start digitizing your warehouse today with Microsoft and its partner ecosystem.

1. Help warehouse managers drive operational excellence with agentic AI

The role of the warehouse manager is pivotal in the supply chain ecosystem, yet warehouse managers are overloaded with information from multiple sources, making it hard to parse what’s relevant and useful.

Blue Yonder’s warehouse manager AI agent offers an easy-to-digest, interactive report designed to help warehouse managers stay up to date with the most important data and information. The agent delivers those key insights when they’re needed, helping ensure operational excellence every day.

Instead of sifting through hundreds of charts and dashboards, pages and pages of report analysis, or piecing together fragments of information from their teams, warehouse managers get a simplified view of what’s happening, what caused the issue, and what to do about it.

It’s like having a personal analyst working alongside the warehouse manager who knows all about their role, their company, and warehouse. That partnership helps the manager move much more quickly from information overwhelm to clear, decisive action.

Blue Yonder expects more developments coming soon, including more data highlights, summaries, and suggested actions, as well as an expanding list of tasks the agents can perform with human guidance.

2. Optimize warehouse design, planning, and operations with simulation

Today’s customers expect retailers to have what they want and deliver it fast to their store or home. Warehouses are critical nodes in the supply chain where optimizations can improve growth and profitability. From receiving shipments to sorting, picking, and packaging, every step of warehouse operations is being modernized with AI that analyzes changes in the physical world.

Simulating facility designs and layouts, processes, and discrete events in fulfillment and distribution centers helps retail and consumer goods enterprises make more informed and faster decisions without the need to physically install systems to evaluate use cases. Simulation also lets enterprises create and use synthetic data to orchestrate between manual labor and automation systems applying AI, machine learning, robotics, sensor technology, management systems, cloud platforms, and data analytics. How can warehouses achieve operational excellence at every step of the orchestration?

NVIDIA Omniverse is a platform for developing and deploying physical AI and simulation applications for industrial digitalization. Developers use Universal Scene Description (OpenUSD) to build solutions on a platform that enables warehouse scale, digital twins, and simulations to optimize layouts and achieve operational efficiencies. These digital twins also serve as virtual training grounds for autonomous systems and robotic fleets that increasingly operate inside these facilities.

Today, leading retailers and consumer goods companies use applications and solutions built on NVIDIA Omniverse to design and simulate greenfield and brownfield warehouses from scratch, establishing an optimal layout and process flow all in a physically accurate digital space. They can evaluate technologies like robotic shelving systems, robotic grid-based storage, or vertical lift modules (VLM) for high-density storage.

Solutions built on Omniverse let retailers integrate data from different enterprise and industrial systems to create, test, and measure design, process, and operational twins before spending precious capital or stepping foot in the building. For greenfield sites, this means a fully optimized virtual version of the entire design before construction begins. For brownfield sites, retailers can seamlessly integrate new automation technologies with existing systems, ensuring the entire warehouse achieves its operational benchmarks and performs as one cohesive unit.

Applications developed with the Omniverse platform also allow supply chain leaders to understand the impact of discreet events that impact efficiency so they can make decisions that improve key performance metrics like warehouse throughput without the risk of costly physical trials.

In the fast-paced world of commerce, time to value is everything. But platform technologies are never the end-all, be-all. That’s why collaborating with the right partners and experts is crucial for retail and consumer goods enterprises. By bringing together integration partners like Accenture to simplify the development and implementation of end-to-end advanced automation and robotics solutions and services, Microsoft’s powerful cloud solutions, and NVIDIA’s cutting-edge accelerated computing, AI, and simulation platforms, retailers can accelerate warehouse transformation and realize value faster than ever.

3. Boost productivity and collaboration with robotics-enabled automation and intelligent orchestration

Warehouse managers have traditionally relied on manual processes and human labor to keep their operations running smoothly. But labor shortages and rising operational costs are making it increasingly difficult to maintain efficiency and productivity. Additionally, the complexity of managing inventory and ensuring timely order fulfillment often leads to bottlenecks and errors.

Advancements in robotics can help supply chains augment staffing, improve employee safety, and drive warehouse productivity. New capabilities are emerging every day and startups are the ones embracing these new capabilities.

Intelligent orchestration and sortation with Unbox Robotics

The last mile can be a significant chunk of the cost in getting the supply chain right. Unbox Robotics is one of hundreds of startups Microsoft works with to deliver retail supply chain solutions. Unbox Robotics can help automate the last mile process by using robots and swarm intelligence that mimics what a swarm of bees or ants do by carrying goods from one place to another. These robots pick items, sort them, and put them in one lot lightning fast so they can easily be picked up and delivered. And because robots can work around the clock, Unbox Robotics can help retailers offset labor challenges with “always on” reliability.

Smart redistributions with YDISTRI—a new era in inventory optimization

Even the best demand forecasting systems can’t fully prevent real-time overstock and understock issues. YDISTRI doesn’t compete with these systems—it complements them by providing an AI-based reactive inventory redistribution solution. For example, in a supermarket chain, YDISTRI analyzes sales patterns, local demand, and product turnover to identify overstocked items—such as specialty foods or seasonal goods—and moves them to stores where they will sell faster at full price, reducing markdowns and waste.

By weighing transfer costs against the risk of discounts or write-offs, YDISTRI helps retailers maximize revenue from existing stock, improving inventory efficiency without relying on heavy markdowns.

Bend the curve on innovation by digitalizing your warehouse in 2025

Improving agility gives retailers the ability to future-proof their business, flex and scale their operations, and be more responsive and adaptive to consumer demands. Supply chain leaders can achieve operational excellence and catapult themselves forward with generative AI, digital twins, and robotics.

Microsoft partners with Blue Yonder, an organization that provides complete solutions across the entire supply chain, and with hundreds of today’s most innovative startups to complement a retailer’s existing technologies. Start using your supply chain as a business enabler by digitalizing your warehouse in 2025 and gain more agility for years to come.

Microsoft Cloud for Retail

Explore solutions

Learn more

• Microsoft’s responsible AI principles

• Enhancing supply chain efficiency in the retail and consumer goods industry with agentic systems

• Delivering your supply chain copilot: Prioritizing areas of ROI

• Delivering your supply chain copilot: Getting started on ideation

¹ “Tariffs: What Retailers Need to Know,” Bain & Company, January 2025.

The post AI-powered retail: 3 reasons to start digitalizing your warehouse in 2025 appeared first on Microsoft Industry Blogs.

Technology integration opportunities in sports 

Microsoft technology helps drive the quality of the game and create new business opportunities for organizations by:

• Enhancing performance with real-time data insights and analytics for data-driven decision-making. 
• Improving operational efficiency through streamlined workflows, increased collaboration, and seamless data integration. 
• Elevating fan engagement with AI and real-time customer insights to create a comprehensive ecosystem of personalized experiences.   
• Unlocking broadcast and media integration opportunities by using advanced cloud and AI technologies to scale content operations and reach more audiences.  
• Supporting secure data storage and processing by implementing advanced cloud technologies to secure content with high-speed data storage and processing. 

Whether it’s supporting Formula One engineers to make split-second race decisions, empowering tennis players with AI-assisted match analysis, or delivering personalized experiences to fans, Microsoft technology is redefining the future of sports—making organizations faster, smarter, and more connected than ever before.  

Learn more about Microsoft’s technical solutions through key partnerships below. 

Data-driven decision-making 

In high-performance sports, every decision can alter the course of the game. From AI-powered analytics that provide real-time insights for athletes to cloud-based solutions that optimize operations, learn more about how Microsoft technology is driving data-led decision-making and reshaping how teams compete in the Women’s World Cup of Tennis, the NFL, and Formula One. 

Billie Jean King Cup: Transforming tennis strategy with AI 

The Billie Jean King Cup uses Microsoft AI and cloud technologies to provide players and coaches with data visualizations and real-time insights during matches.  

Key highlights include: 

• Match Insights App: Azure hosted application that delivers critical gameplay data, such as player movement, ball trajectories, and shot accuracy, to coaches and players in near real-time. 
• AI-powered analytics: Microsoft Azure OpenAI Service analyzes vast datasets to provide actionable rally and serve insights, helping coaches anticipate opponent strategies and make informed decisions. 
• Secure data management: Microsoft Azure Cloud Services help to ensure the secure storage and processing of high-volume data generated during matches. 

Read more about how Microsoft and the Billie Jean King Cup are elevating competition through data-driven insights.

NFL: Game-changing technology on the sidelines 

The NFL uses Microsoft hardware and software to enhance game-day operations and team collaboration. 

Key highlights include: 

• Microsoft Surface Sideline Viewing System (SVS): Hardware and software solution that provides coaches and players with near real-time, high-resolution images of plays, enabling rapid strategic adjustments. 
• NFL Combine App: Application that streamlines talent evaluation by providing real-time access to key performance metrics. 
• Enhanced collaboration: Microsoft Teams and Azure facilitate seamless communication and collaboration among NFL teams. 

Read more about how Microsoft and the NFL are changing the game with new levels of operational efficiency.

BWT Alpine Formula One Team: Data-powered racing innovation 

BWT Alpine Formula One Team uses advanced AI and Azure’s robust cloud infrastructure to unlock new capabilities in data insights, regulatory compliance, and business operations.  

Key highlights include: 

• AI-powered race strategies: Azure Computer Vision and Multi-Agent Resourcing Optimization (MARO) reinforcement learning allows Alpine to optimize race day strategy and car setup based on real-time telemetry. 
• High-speed data processing: Azure provides secure, high-speed data storage and retrieval, allowing split-second decisions during races. 
• Regulatory compliance: Azure AI Search and Microsoft Copilot Studio streamline compliance processes, helping to ensure adherence to Formula One regulations. 

Read more about how Microsoft and BWT Alpine Formula One Team are maximizing performance on and off the track.

Integrated fan engagement 

In today’s digital world, sports leagues are expected to meet fans at multiple touchpoints with highly personalized and easily accessible content. Learn more about how leagues such as LALIGA and the NBA are using Microsoft technology to redefine the sports and entertainment industries and take the fan ecosystem to the next level. 

LALIGA: Enhancing fan engagement with data-driven insights 

LALIGA uses real-time data processing and AI-powered analytics with Azure to deliver match insights and personalized digital experiences across platforms. 

Key highlights include: 

• Beyond Stats: Fan-facing data and insights platform powered by Azure that captures and analyzes more than 3.5 million data points per match to provide engaging content for fans across multiple platforms including social media, broadcast, and the LALIGA app. 
• Data Sports Platform (DSP): Comprehensive system powered by Azure that unifies fan interaction data across touchpoints to generate tailored content and products to match fan preference. 
• Seamless infrastructure: Azure’s high-performance infrastructure helps to ensure reliable content delivery and enhanced fan experiences across digital platforms. 

Read more about how Microsoft and LALIGA are personalizing the experience for fans around the world.

NBA: Building a next-generation fan engagement platform 

The NBA integrates Azure and AI technology to provide fans with personalized content, real-time insights, and tailored experiences across digital platforms.  

Key highlights include:  

• AI-integrated platform: The NBA Insights and Top Performances platforms within the NBA App provide real-time game updates and AI-generated highlights to enhance the fan experience by utilizing Microsoft AI technology. 
• The reimagined NBA App: Powered by Azure, the NBA App offers personalized content recommendations, real-time game insights, and a social-style video experience. 

Read more about how Microsoft and the NBA are deeply engaging fans at every level.

Transforming the sports industry

Microsoft innovative technologies are transforming the sports industry, driving performance, enhancing fan engagement, and streamlining operations. From the racetracks of Formula One to the courts of the NBA, Microsoft’s partnerships are setting new standards for excellence in sports. As technology continues to evolve, the future of sports looks brighter than ever, with Microsoft leading the way in this exciting journey.

Learn more about how Microsoft is transforming sports and other media and entertainment organizations around the world through our customer stories page. 

Microsoft’s commitment to the media and entertainment industry  

Microsoft allows media organizations to achieve more through a trusted and secure platform, built to empower content creators and distributors, enhance the viewer experience, and reimagine monetization strategies. More information can be found on the Microsoft media and entertainment industry solutions website. 

Next steps 

Microsoft will be showcasing some of these case studies and more at our upcoming exhibition with NAB Show, April 5–9, 2025, in Las Vegas. Go through a journey of interactive demos that illustrate the capabilities needed to deliver fan-focused content and that highlight key aspects of the transformation process required to implement cutting-edge technologies for enhanced performance and fan engagement.

Microsoft at the 2025 NAB Show

See how Microsoft is helping to shape the future of broadcast and entertainment

Learn more

The post How Microsoft is transforming sports with cutting-edge technology  appeared first on Microsoft Industry Blogs.

Yet even with all this progress, for decades fragmented systems and heterogenous environments have kept digital threads within the industry largely aspirational, preventing most organizations from achieving synchronized operations. A persistent inability to connect modern technology solutions with aging infrastructure has also slowed the collaboration long promised to manufacturers. Together, unified data and AI are now enabling organizations of all sizes to break through these barriers, transforming digital threads from static, disconnected datasets to dynamic networks. With AI agents serving as the interface, every worker can surface the overall equipment effectiveness (OEE), total cost of ownership (TCO), and return on investment (ROI) insights necessary to drive decision-making.

At Hannover Messe 2025, Microsoft is showcasing how new AI agents and partnerships with leading software vendors can help manufacturers deliver secure, scalable innovation from the shopfloor to the boardroom. Attendees will experience firsthand how data-driven intelligence and AI-enabled solutions will reshape manufacturing.

AI agents supporting the development of frontline workers 

Manufacturing transformation is reaching into every aspect of operations. Frontline workers now have access to AI agents providing them with enhanced guidance needed to make informed decisions. To expand this modern toolbox, we announced back at Ignite 2024 the public preview of Factory Operations Agent in Azure AI Foundry. An AI-powered assistant, Factory Operations Agent streamlines operations—enabling operators, production, and leaders to quickly access insights and optimize manufacturing processes through natural language querying. In doing so, the agent accelerates issue resolution and root cause analysis to improve productivity within day-to-day manufacturing operations.

As the industry struggles with turnover, worker skilling is an ever-present challenge. The World Economic Forum found that 63% of industry leaders believe skilling to be a significant barrier to growth.¹ Manufacturers need no-code and low-code options that democratize the power of AI without the need for extensive coding. With this in mind, we are announcing the same Factory Operations Agent now available in Copilot Studio in public preview, where with one-click it can be easily integrated into products like Microsoft Teams.

Finally, we’re announcing the public preview of Factory Safety Agent in Copilot Studio. This low-code, customizable solution provides workers with answers to occupational health and safety (OHS) questions and guidelines. It can also streamline safety inspections and personalize workforce training. 

Also, at Hannover Messe 2025, we will be showcasing state of the art technologies that will enhance the future of frontline work, like with our customer Sanctuary AI.

Sanctuary AI is shaping the future of frontline work, ushering in the era of autonomous labor with the power of Microsoft Azure. As frontline labor shortages intensify, manufacturers can explore deploying advanced general-purpose robots with dexterity-driven physical AI to automate repetitive, complex, and unsafe tasks to enhance operational efficiency. With Azure’s high-performance graphics processing units (GPUs), Sanctuary AI can train machine learning models at scale, pushing the boundaries of dexterous intelligence. 

Advancing innovation in digital engineering with generative AI 

Manufacturers shape their market leadership through digital engineering and design. By accelerating development and prototyping, and reducing time-to-market, AI-powered generative design is empowering manufacturers to create new high-performing, customer-centric products.

GenAI use cases to modernize manufacturing

Explore the value generative AI creates across the organization

Learn how

Aras is introducing Aras InnovatorEdge, a low-code application programming interface (API) management framework embedded in the Aras Innovator® platform. This solution simplifies API creation and integration, enabling secure, scalable data connectivity and enhancing collaboration, operational efficiency, and decision-making across enterprises. It integrates seamlessly with Microsoft Fabric, unlocking deeper insights and optimizing decision-making across the digital engineering landscape. 

Autodesk and Microsoft collaborate to create an AI-powered digital thread to help manufacturers gain efficiencies, reduce costs, and compete smarter. Autodesk® Fusion, the industry cloud for manufacturing, connects people, data, and process through the product development lifecycle. Autodesk Data solutions in Fusion Manage and Microsoft Fabric will enable efficient data management and process optimization. Additionally, Autodesk’s digital twin offerings with Tandem, factory simulation through FlexSIM, and factory operations management with Fusion Operations all benefit from this collaboration, ensuring that these tools work seamlessly across the IT and OT ecosystem. 

Windchill by PTC is a crucial platform for engineering and manufacturing teams globally. To support manufacturers aiming to integrate AI across their value chains, PTC and Microsoft are partnering to develop an enterprise data framework and multi-agentic model within Microsoft Fabric. This collaboration extends digital thread capabilities beyond traditional product lifecycle management (PLM), integrating data from enterprise resource planning (ERP) and manufacturing execution system (MES) systems, and enabling AI-powered insights and workflows. 

Preparing the factory edge for AI  

AI is redefining factory operations, but to fully capitalize on shop floor investments, manufacturers need to integrate their on-premises industrial edge solutions with the cloud. 

A core component of the Azure adaptive cloud approach, Azure IoT Operations is built on industry standards. Capturing data from industrial equipment assets and devices, Azure IoT Operations normalizes it at the edge—sending operational insights to the cloud and back.

Husqvarna is leveraging Azure IoT Operations and AI tools to digitally transform its factory floors. Their AI Vision Companion enhances visual quality control for chainsaw production, while AI chatbots assist night workers with troubleshooting, improving efficiency, and reducing downtime. With these new capabilities, Husqvarna expects to double their in-market connected devices and boost robotic lawn mower sales, expanding Azure IoT Operations from two to 40 factories globally by summer 2025. 

Siemens and Microsoft have expanded their partnership, Siemens Industrial Edge works seamlessly with Microsoft Azure IoT Operations, making OT and IT data planes fully interoperable for manufacturing. This joint effort streamlines data flow between edge and cloud, enhancing machine performance, product quality, and maintenance efficiency, and enabling manufacturers to adopt AI and digital twin technologies for more adaptive, optimized production.

Making AI-powered digital threads a reality for manufacturers 

The nervous system of industrial operations, digital threads weave together critical information, processes, and people across manufacturing segments. Grounded in unified operational (OT), information (IT), and engineering (ET) data, the electronic frameworks can empower individuals with relevant, timely insights. From initial concept to customer support, this continuous flow of data connects and enriches every aspect of manufacturing.

For over a century, Rolls-Royce has been a force for progress; powering, protecting, and connecting people everywhere. Today, with digital transformation at the forefront, the company is redefining how its world-class products are designed, built, and maintained. Hannover Messe 2025 visitors will see firsthand how AI and cloud technologies are shaping the future of aerospace. With the help of Siemens and Microsoft, Rolls-Royce is leveraging AI to streamline production, boost engine efficiency, and predict maintenance needs before issues arise. Rolls-Royce is also helping provide more efficient, reliable, and low-emissions energy solutions, powering everything from critical infrastructure to data centers. Rolls-Royce isn’t just keeping up with the digital revolution—it’s driving it.

Without AI, manufacturing data is difficult to navigate. Data quality, standardization, and integration have been unreliable. Microsoft is helping manufacturers make sense of their data to unlock the AI opportunity. With Microsoft Fabric, manufacturers can integrate data across different departments and teams. Traditionally, this data is trapped within separate systems. Parsec and Tulip integrations mark another major step in our ability to drive operational intelligence, enhancing shop floor and frontline execution. 

Parsec, developer of the industry-leading MES, TrakSYS™, today announced an upcoming integration with Microsoft Fabric and the factory operations agent in Azure AI Foundry solution to help deliver generative AI to manufacturing organizations. Dubbed TrakSYS IQ, this industry-defining functionality will enable users to retrieve and analyze factory data through a conversational user interface, bolstering productivity and data-based decision-making. 

Tulip, a leader in frontline operations solutions, announces its integration with Microsoft Fabric. This integration enables the Tulip Frontline Operations Platform to deliver scalable analytics across multiple factories, leveraging rich datasets for machine learning to provide real-time feedback and alerts to supervisors and operators. 

See Industrial AI in action at Hannover Messe 2025

The future of manufacturing is powered by AI. This year, at Hannover Messe 2025, attendees will have the opportunity to experience how Microsoft and its partners are supporting the industry transformation—from digital engineering, on factory floors, with frontline workers, and through digital thread. Join us at Hall 17, Stand G06. 

Thanks to all partners and customers joining Microsoft at Hannover Messe 2025: ABB, Accenture Avanade, Autodesk, AVEVA, AVL, Bayer, Blue Yonder, Bosch, Bühler Group, C3.ai, Capgemini, Cognite, Databricks, EPLAN, Hexagon, Husqvarna, Kongsberg Digital, Litmus, MTEK, NVIDIA, NTT Data, o9, Parsec, PTC, PWC, Rescale, Rockwell Automation, Rolls-Royce, Sanctuary AI, Sandvik, Schneider Electric, Siemens, Sight Machine, Symphony AI, TeamViewer, TCS, and Tulip. 

¹WEF: Skill Gaps are the Biggest Barrier to Transformation, Skillsoft.

The post Industrial AI in action: How AI agents and digital threads will transform the manufacturing industries appeared first on Microsoft Industry Blogs.

The proliferation of distributed energy resources (DERs)—small-scale units of power generation and storage that operate locally and are connected to larger grids at the distribution level—is also leading power providers to rethink how they operate. DERs could dramatically reduce the need for centralized power generation, but they could also push traditional operational technology (OT) environments to their limits and create heightened need for security.  

A modern, flexible, and secure grid with unified information technology (IT) and OT will become increasingly important for grid operators as consumers add solar panels, electric vehicles, or battery storage and seek to connect to the grid. In fact, a recent survey conducted by Guidehouse shows that 61% of utilities executives believe that utility infrastructure investments should prioritize increased flexibility to improve energy system resilience². AI has the potential to boost resilience by helping providers forecast and manage load demand, maintain power balance, enhance security, support predictive analytics and maintenance, and optimize workforce management and dispatch, among many other use cases. 

Power and utilities companies aren’t alone in recognizing the benefits of AI. A recent study on AI adoption shows that over the next three years, 92% of companies will increase their AI investments, particularly in generative AI; yet only 1% consider their AI deployment to be “mature,”³ indicating there’s still tremendous opportunity to drive continued AI transformation for improved business outcomes. Critically, employees are ready for this change. In fact, three times more employees are using generative AI for 30% or more of their work than their leaders imagine.⁴ It’s a sign that for many companies, the AI transformation is already underway, and teams are eager to unlock new levels of creative potential and productivity.  

An adaptive cloud approach helps streamline operations and provide critical power service 

Through comprehensive cloud, data, and AI offerings, Microsoft and its global partner ecosystem support power and utility providers as they digitally transform and drive sustainable business growth while meeting customer demand. The adaptive cloud approach seamlessly integrates IT and OT, bringing together on-premises control systems and edge intelligence with cloud-scale analytics. This lays the foundation for unlocking the power of their data, further allowing them to utilize AI to meet increasing energy demand and solve their most complex challenges.  

Take Uniper, for example. As the world’s largest power generation company, Uniper needed a solution to help standardize IT and OT so it could manage all applications in a uniform manner. An adaptive cloud strategy helped standardize IT and OT environments, launch new services faster, and optimize performance.  

Emirates Global Aluminum (EGA) has another adaptive cloud success story. EGA’s on-premises environment couldn’t deliver the level of flexibility needed to manage data-intensive operations with scalable computing infrastructure. A hybrid approach allowed them to move part of their server base to the Microsoft Azure public cloud and another part to run hybrid at the edge with Azure Local. This helped optimize latency, support advanced AI and automation solutions, and offer sustaining commercial savings by applying intelligence at the edge.  

By embracing adaptive cloud, power and utilities providers can future-proof their operations and build the resilient energy systems of tomorrow—without compromising compliance, security, or operational continuity.   

Sharing success stories and insights at DISTRIBUTECH  

In an era where the imperative for clean, reliable, and accessible energy has never been greater, Microsoft relies on the knowledge and innovative potential of its partners and customers to help spearhead progress. The success stories mentioned above are made possible through the collective efforts of a complete partner and customer energy ecosystem. The company looks forward to connecting with this ecosystem at important energy industry events like the upcoming DISTRIBUTECH International 2025 conference, where it’ll share the latest in AI-powered insights at the annual energy transmission and distribution event. Held in Dallas, Texas from March 24 to 27, 2025, this year’s event promises engaging speaking sessions, exhibitions, and demos across trending topics like energy storage, transportation electrification, distributed energy resource management, and, of course, the latest on AI.  

Microsoft will join its energy partners and customers on stage and at the Microsoft booth as it highlights its work to accelerate the energy transition and address some of the biggest challenges across the power and utilities sector. It’ll speak to some of these challenges at its thought leadership sessions throughout the week, as well as highlight the opportunities to utilize cloud and AI capabilities to tackle them. These conversations couldn’t be timelier, as issues like cybersecurity and threat recovery impact power and utilities providers around the world every day. To that end, Microsoft Energy and Resources leaders will participate in keynote sessions on topics like cybersecurity in the power and utilities sector. They’ll dive into the evolving threat landscape, the intersection of regulation and innovation, and the key measures utilities can take to safeguard critical infrastructure. Microsoft will also take part in a keynote session on transforming power and utilities with AI, where the conversation will revolve around the ways in which AI-powered solutions are revolutionizing utility operations.  

Highlighting Microsoft’s partner ecosystem 

Microsoft will join several energy and technology partners at DISTRIBUTECH to further the discussion on global collaboration and partnership as critical aspects of the energy transition. It will serve as a guest speaker for Schneider Electric’s Knowledge Hub session on grid technologies, diving into the ways that AI and digital transformation are revolutionizing grid operations and management. The occasion marks another milestone in the deep Microsoft partnership with Schneider Electric as we collaborate with the company on the release of its new digital grid solution. Powered by Azure and AI, the new solution is designed to equip utilities with the digital tools to navigate modern energy challenges and support more resilient energy infrastructure. 

Microsoft is also working with longtime partner Itron to empower utility companies with data and intelligent analytics. Itron is integrating Microsoft Copilot technology into its Intelligent Edge Operating System (IEOS), a global data platform running on Azure, to help utilities to use natural language queries to more easily access essential data and insights to accelerate decision making, support innovation, and streamline repetitive tasks. By utilizing Microsoft AI solutions, Itron helps its customers transform complex data interactions into simple, intuitive processes, significantly boosting operational efficiency. 

In addition, Microsoft is collaborating with Siemens Energy’s Industrial Cyber and Digital Trust teams within Digital Solutions to enhance cybersecurity in the energy sector. By integrating Microsoft’s leading cybersecurity capabilities with Siemens Energy’s advanced solutions in the gas turbine business, we are strengthening resilience against evolving threats. This partnership underscores our shared commitment to securing critical infrastructure and driving digital trust across the industry. 

Microsoft also recently announced a collaboration with EPRI (Electric Power Research Institute) through the Open Power AI Consortium to advance AI innovation in the electric sector. This partnership focuses on developing industry-specific AI and generative AI use cases, creating responsible deployment frameworks, and establishing an AI sandbox on Azure for testing and refinement. By fostering collaboration among utilities and key stakeholders, we aim to drive continuous improvement, knowledge sharing, and real-world impact across critical infrastructure. 

Microsoft will co-host a breakfast roundtable with Accenture along with our other energy ecosystem partners AVEVA, IFS, Itron, and Schneider Electric to discuss the keys to unlocking return on investment (ROI) and overcoming barriers to scale AI and digital technologies. Together with utility customers, they will discuss data challenges, regulatory issues, and organizational barriers that utilities face in their data transformation journeys.

Microsoft hopes to see many of you at DISTRIBUTECH 2025 as they share energy success stories and learn how others are driving positive change for a new energy future.  

Explore more energy solutions and resources  

• Read the Microsoft Industry Blogs: Energy and resources to learn about themes and actions critical for energy transition.  
• Learn how to achieve more in the energy and resources industry with trusted data and AI solutions from Microsoft.  
• Watch this webinar about AI-powered forecasting in power and utilities with Microsoft Energy and Resources leader Hanna Grene and Amperon Chief Revenue Officer Alex Robart 
• Check out this webinar on how AI solves real utility challenges, featuring Microsoft’s Laurent Boinot 

Sources:

¹ 2025 Power and Utilities Industry Outlook, Deloitte, December 2024. 

² Public Utilities Fortnightly®, Special Issue, State and Future of Power, Guidehouse, June 2024. 

^3,4 Superagency in the workplace: Empowering people to unlock AI’s full potential, McKinsey & Company, January 2025. 

The post Transformation in power and utilities with the Microsoft Cloud and AI  appeared first on Microsoft Industry Blogs.

Historically, logistics has lagged other industries in digital transformation. More than 75% of industry leaders acknowledge that their sector has been slow to embrace digital innovation. Instead of prioritizing digital transformation, companies have traditionally focused on incremental improvements in operational processes. But in today’s fast-moving market, this approach is no longer enough as customer expectations have also evolved dramatically. A staggering 91% of logistics firms report that their clients now demand seamless, end-to-end logistics services from a single provider.¹

AI has become a game-changer for the industry to help overcome challenges and fulfill customer expectations. From enhancing customer experiences—such as shipment planning and service requests—to driving productivity in core supply chain operations and demand forecasting, AI presents a massive opportunity. AI can also improve safety, sustainability, and workforce reskilling, giving employees more time to focus on customers. The numbers speak for themselves: AI-powered innovations could reduce logistics costs by 15%, optimize inventory levels by 35%, and boost service levels by 65%. Over the next two decades, AI adoption in logistics could generate between $1.3 trillion and $2 trillion per year in economic value.² 

In fact, the AI revolution in logistics is already underway, and Microsoft is at the forefront, empowering businesses with Azure’s cloud capabilities and cutting-edge AI solutions.

With this article, Microsoft releases two new reference architectures—Adaptive Cloud for Logistics and Supply Chains and AI-enhanced experiences for Logistics and Supply Chain, enhanced functionalities in Dynamics 365 for Supply Chain, and showcases partner-led offerings.  

The use cases 

What are the use cases that AI can impact in logistics? The answer is simple: Almost everywhere along the value chain. This covers inbound logistics and outbound logistics as well as supporting activities, see the overview below: 

Inbound logistics 

One of the most critical use cases in supply chain optimization is demand forecasting. Accurate predictions by AI can serve as the foundation for downstream activities—driving efficiency and enhancing overall optimization. For example, precise demand forecasts play a key role in inventory management and storage optimization within warehouse management systems.  

SPAR Austria, a leading food retailer with over 1,500 stores, has significantly improved its demand forecasting capabilities through AI-powered solutions built on Microsoft Azure in collaboration with Microsoft partner Paiqo. This advanced implementation has achieved more than 90% forecast accuracy, leading to a 15% reduction in costs by minimizing waste.

AI-based route optimization can lead to significant fuel cost reductions, which is a substantial cost-saving measure for logistics companies and contributes to sustainability goals. Load management algorithms and real-time data analytics maximize space utilization in trucks, vessels, and warehouses. 

Additionally, AI-based scheduling, booking, shipping, and invoicing have significant impact on flexibility, cost, and operational process efficiency.  

Dow Chemical, a global leader in materials science, faced significant challenges with its existing freight invoicing system, which involved up to 4,000 daily shipments and various types of invoices. A newly developed invoice agent built with Microsoft Copilot Studio streamlines the company’s freight invoicing process by monitoring incoming emails for attached invoices, structures the data for analysis, and scans for billing inaccuracies. This automation helps Dow manage its logistics spending more efficiently, reducing potential overpayments and improving operational efficiency.

Outbound logistics 

AI and robotics play a crucial role in optimizing picking and packing processes. Additionally, advancements in technology enhance order processing and returns management—streamlining operations and driving cost reductions. 

Cutting-edge technologies like natural language processing (NLP) and machine learning are transforming customer interactions by reducing handling times and associated costs. With the deployment of virtual assistants and every day customer support, businesses can improve response times significantly.  

Global sports retailer Decathlon, in partnership with Microsoft partner Parloa, has successfully leveraged AI to enhance customer service. By implementing AI-powered solutions, the company has reduced the number of calls forwarded to live agents by 20%, demonstrating the power of automation in improving efficiency and streamlining customer interactions.

Supporting activities 

AI and emerging technologies are transforming key support processes across the logistics value chain. In procurement and pricing, for example, AI-powered agents streamline the request for proposal (RFP) and request for quote (RFQ) process. Additionally, dynamic pricing capabilities optimize revenue management, while AI-powered advancements enhance traditional finance and controlling functions. AI also plays a crucial role in simplifying customs management and ensuring seamless regulatory compliance. 

Below is an overview of solutions from independent software vendors (ISVs) and partners that can be leveraged out-of-the-box for selected use cases: 

• Wandelbots: Robotics for picking and packing
• Paiqo: Demand forecast
• InstaDeep: Load optimization
• Fareye: Route planning and optimization
• Parloa: Customer service
• Coneksion: Messaging
• CH Robinson: Mail AI agents
• Cosmo Tech: Supply chain simulation

3 building blocks for a digitized state-of-the-art logistics 

From a Microsoft perspective, there are three key building blocks for logistics and supply chain companies to build an AI-ready platform that can enable a variety of use cases: 

1. Adaptive Cloud: The modular base infrastructure 
   Microsoft adaptive cloud unifies siloed teams, distributed sites, and sprawling systems into a single operations, security, application, and data model across hybrid, multi- cloud, edge, and Internet of Things (IoT) environments. 
2. Microsoft Dynamics 365 suite: Microsoft’s comprehensive business suite 
   Dynamics 365 suite, including Supply Chain Management, offers comprehensive solutions to enhance visibility, streamline procurement, optimize fulfillment, and improve planning. 
3. AI and agentic AI: Solutions to automate business processes 
   Microsoft offers advanced agentic AI solutions which enable the creation and orchestration of agent- and multi-agent systems for enhanced productivity and automation. 

Adaptive cloud: The modular base infrastructure 

Within the logistics domain, adaptive cloud can address multiple areas for increased efficiency such as quality control, warehouse operations, damage detection, or robotics automation. With the capabilities of the full Azure stack on the edge, IoT operations, and a data fabric, adaptive cloud is the essential lever for improving business both in the cloud and on the edge. 

Adaptive cloud shifts organizations from a reactive posture to one of proactive evolution, enabling people to anticipate and act upon changes in market trends, customer needs, and technological advancements ahead of time. This strategic foresight enables businesses to pivot quickly, embrace continuous improvement, and integrate new technologies smoothly. By building resilience into their operational models, businesses can optimize resource usage and mitigate risks before they manifest. 

The adaptive cloud can be adapted or selectively applied to multiple customer scenarios. We map how commitments and promises are realized by system skills and capabilities below:

• Operate with AI-enhanced central management
  Elevate IT capabilities and focus on strategic work by abstracting resources from distributed locations into one operations and management layer with AI assistance and automation. 
  Critical capabilities:
  • Universal AI assistant, portal, and tools
  • Consistent configuration management
  • End-to-end observability
  • Governance at scale
  • Built-in security and control
• Rapidly develop and scale applications across boundaries
  Bridge OT and IT gap to transcend legacy system constraints with composable cloud-native tool chains, containers, and data services everywhere.
  Critical capabilities:
  • Kubernetes everywhere
  • Hyperscale cloud services to the edge
  • Central application deployment
  • Global orchestration and resiliency
  • Streamlined DevOps integration
• Cultivate data and insights across physical operations
  Supercharge physical operations with a unified data foundation, enabling efficient workflows, predictive insights, and cost-effective resource utilization from edge to cloud.
  Critical capabilities:
  • Common data foundation
  • Actionable insights with AI Coordinated workflow orchestration from edge to cloud
  • Contextualized data to information
  • Centralized device management

Dynamics 365 suite: Microsoft’s comprehensive business suite

The Dynamics 365 Supply Chain Management portfolio outlines various stages and components of the supply chain process, divided into several categories, from design to decommission to record to report. The table below indicates the bandwidth of the suite capabilities: 

Microsoft Copilot enhances supply chain management by leveraging AI and automation. By integrating Dynamics 365 with AI-powered Copilot, organizations can significantly enhance their supply chain management processes. The combination of advanced AI capabilities and comprehensive business applications ensures that supply chain operations are efficient, responsive, and adaptive to changing conditions.  

The new Warehouse Management Only Mode is a specialized feature within Microsoft Dynamics 365 Supply Chain Management (and can also be used standalone) designed to cater specifically to warehouse management processes. This mode allows businesses to set up a legal entity dedicated solely to warehouse operations, providing warehousing services to other legal entities within Supply Chain Management or even to external enterprise resource planning (ERP) and order management systems. 

AI and agentic AI: Solutions to automate business processes 

The new AI-enhanced reference architecture for logistics brings it all together—from the connection to existing data systems to AI-enhanced experiences for various user groups like end-customers, warehouse managers, fleet managers, or customer service: 

The user-facing applications layer describes some of the common front-end experiences that can be built using Microsoft services. End users require mobile and web applications built using services such as Azure API Management, Azure App Service, and Azure Functions. Developers create AI-powered user experiences leveraging services such as Azure OpenAI Service. These applications can be deployed in Azure tenants and can scale to millions of users.  

Business users leverage Dynamics 365 (including Dynamics 365 Customer Service, Dynamics 365 Finance, Dynamics 365 Project Operations, and Dynamics 365 Customer Insights) to manage business operations such as claims, promotions, and ticketing. Dynamics 365 has built-in custom agents for many common business use cases such as customer service, sales, finance, field service, and customer insights.

Front line workers are fully integrated into the business with customized workflows and automated operations with custom AI, tailored to their needs and the ergonomics of their workplaces, whether fixed terminals, mobile devices, or augmented reality.  

Microsoft Copilot Studio facilitates the creation of custom AI agents to support their work. Power Apps enable the creation of custom user interfaces, while Power Automate enables the creation of business workflows. With Microsoft 365 Copilot, employees can collaborate and communicate using Microsoft products such as Microsoft Teams, SharePoint, and Outlook. 

The operation of supply chain and logistics generates large amounts of data. The data storage and analytics layer describe how to securely store business data to support operations and create insights. 

Microsoft Dataverse is a scalable data platform that securely stores and manages business data. The data model is a structured framework that organizes data in tables with relationships. It is possible to use industry models to harmonize and integrate business data across multiple applications.  

Microsoft Fabric is an end-to-end data and analytics platform that includes real-time analytics capabilities. OneLake is a unified logical data lake that centralizes and simplifies data management, with multiple analytical engines and workspaces. Fabric enables organizations to process and analyze data for timely insights and decision-making. Supply chain and logistics are established businesses. It is important to integrate existing data systems, such as connected assets as well as existing systems. 

Messaging services on Azure enable connectivity to assets and devices using standardized communication protocols such as Message Queuing Telemetry Transport (MQTT) with Azure Event Grid, or data streams like Apache Kafka using Azure Event Hubs. Serverless solutions like Azure Functions provide compute to process messages. 

Get in touch with us 

Customers can work directly with Microsoft Industry Solutions teams on custom projects that offer a short go-to-market time. Whether you choose ready-to-deploy partner solutions or bespoke projects with Microsoft partners or Microsoft Industry Solutions, we provide the expertise and support to ensure your success.  

Visit Microsoft for travel and transportation or contact our team to learn more and take the next step in your Microsoft AI journey.

Microsoft for travel and transportation

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¹ Accenture, Freight and Logistics: Finding the right path to digital transformation, 2023.

² McKinsey, Digital logistics: Into the express lane?, December 2024.

The post The future of logistics: How generative AI and agentic AI is creating a new era of efficiency and innovation appeared first on Microsoft Industry Blogs.

In a recent playbook, Accelerating sustainability with AI: Innovations for a better future, we outlined our five plays to advance sustainability, providing insight into our work at Microsoft and how business leaders around the world are creating a new path forward.

The reason to choose AI for this work? It has three unique abilities that can help organizations overcome key bottlenecks. AI can: (1) measure, predict, and optimize complex systems, (2) accelerate the development of sustainability solutions, and (3), empower the sustainability workforce. These capabilities make AI a critical enabler of progress.

How can business leaders harness AI to accelerate resilience, efficiency, and sustainability in their organization?

I recently met with Lindsay Myers, Vice President, Commercial Cross Solutions at Microsoft, who leads our Commercial Sustainability business, to talk more about this guidance and how business leaders can harness AI to accelerate resilience, efficiency, and sustainability in their organizations.

Toby: Hi Lindsay, before we dive into the playbook, can you share your thoughts on how organizations are adopting AI to address these interconnected goals of resilience, efficiency, and sustainability?

Lindsay: It’s important to highlight how interconnected these goals are in many organizations today. We often see initiatives started by sustainability teams result in significant cost savings for organizations. This might be efficiency gains for existing operations, or entirely new approaches like digital twins that enable rapid iteration before initial prototypes are built. When companies choose an approach like digital twins, it can reduce the materials needed for physical models—saving time and costs—while improving resilience through agility.

Explore customer and partner examples of AI innovation

Toby: Can you give me some examples of customers and partners who are doing this work today?

Lindsay: AI is making a real difference in helping organizations prepare for climate risks, innovate for maximum efficiency, and solve complex challenges. For example, in Germany, where urban flooding is a major concern, cities are searching for innovative ways to mitigate the impacts of heavy rainfall and its impact on communities and infrastructure. Esri, a global leader in geographic information system (GIS) software is helping cities unlock the power of digital twins driven by geospatial data and AI. This solution helped the City of Stuttgart cut its reality mapping time from five months to 24 hours, enabling local government and public safety staff to understand potential impacts and make decisions faster.

Stadtwerke München (SWM), the municipal utilities company serving Munich, has made it its mission to drive every aspect of the city’s energy, heating, and mobility transition forward. To accomplish this, it needed maximum-efficiency processes, such as predictive infrastructure maintenance and optimized operations planning. It has turned to Microsoft Azure and Azure IoT to efficiently provide power to its public transport fleet of 100% electrified vehicles.

Unlock new possibilities with data and AI

Toby: Those are inspiring examples; they give a real sense of AI’s potential. The playbook outlines 5 plays, or ways that organizations can unlock this potential. Could you describe some of these?

Lindsay: Let’s talk first about the first two plays and how they work together.

Investing in AI solutions to measure, predict, and optimize complex systems can drive both innovation and efficiency, helping companies focus on the most strategic priorities for business resilience.

For example, Mitiga Solutions, a global leader in climate risk intelligence and a Microsoft Climate Innovation Fund investment leverages AI, high-performance computing, and advanced climate models to predict the impact of physical climate hazards on any asset, anywhere in the world, from now until the end of the century. This helps infrastructure, commercial real estate, insurers, and companies across industries comply with climate disclosure regulations while proactively strengthening their resilience.

 With AI-powered solutions, businesses can swiftly tackle complex challenges across their own supply chains and for their customers. This not only positions companies as leaders in sustainability but can also unlock new market opportunities and enhance their competitive advantage.

It’s crucial to build a strong digital and data infrastructure to maximize AI’s potential—your AI is only as good as the data it relies on. That’s why having high-quality, representative data and the right processing infrastructure is essential. It enables teams to make informed decisions and provides accurate input for AI applications.

For many of our customers and partners, these two plays are closely linked. The foundational work involves bringing all the necessary data together in one place, like in Microsoft Fabric. What’s amazing about Fabric is it lets you reason over both internal and external data, which is incredibly helpful for things like regulatory reporting.

Once your data is set up properly, your team can use solutions such as Microsoft Copilot to ask questions of their data, generate reports, and learn from industry best practices. Copilot streamlines these tasks, reducing manual work and enabling practitioners to focus their time on new strategic initiatives.

Minimize resource use in AI design and operations

Toby: When I talk to organizations looking to adopt AI, customers and partners often want to learn more about what Microsoft is doing to reduce the environmental impact of AI. Could we talk a bit about that?

Lindsay: Absolutely. Let’s talk about play 3 and how that relates to our work at Microsoft.

AI has its own energy and water demands, so it’s crucial to minimize resource use and move toward powering AI systems with carbon-free energy. In addition, since AI infrastructure is often concentrated in specific regions, it is essential to support the local communities where datacenters are located. At Microsoft, we’re innovating across three critical areas to continue to advance the sustainability of cloud and AI services:

1. Optimizing datacenter energy, water, and waste efficiency while protecting ecosystems.
2. Advancing low-carbon materials and creating global markets to promote industry-wide sustainability.
3. Enhancing the energy efficiency of AI and cloud services.

Many of our customers and partners want to know not only what we’re doing, but also what they can do to manage resource use. Our Well-Architected Framework sustainability guidance provides a great starting point, as well as small language models that perform specific tasks using fewer resources than larger models.

Build workforce capacity to use AI for sustainability

Toby: The pace of innovation in this domain is incredible. Is there anything more you’d like to add in terms of how your team helps leaders move their ideas from concept to implementation?

Lindsay: The way forward on this journey is through people working together, and this is an area where we can help customers and partners make progress. Let’s talk about the final play first:

For companies to be able to put AI’s three game-changing capabilities to work, they must have skills to use AI effectively. Microsoft has training programs focused on building AI fluency, supporting nonprofits, businesses, and governments in advancing workforce AI technical skills and promoting safe and responsible AI development.

Microsoft’s AI learning hub can empower customers on their AI transformation journey, and customers can also use Copilot to connect with their data in Microsoft Cloud for Sustainability and sustainability data solutions in Microsoft Fabric. With these tools, employees can quickly gain insights, understand gaps, and identify what’s needed to move initiatives forward.

Toby: Thank you, Lindsay!

Transform business using generative AI

For business leaders wanting to put these plays in action and guide their organizations through effective AI adoption, we’ve published the 2025 AI Decision Brief: Insights from Microsoft and AI leaders on navigating the generative AI platform shift. This report is packed with perspectives from top Microsoft leaders and insights from AI innovators, along with stories of companies across industries that have transformed their businesses using generative AI.

The post Harnessing AI for resilience, efficiency, and sustainability appeared first on Microsoft Industry Blogs.

Over the last decade, this end-to-end view, has been the promise of digital threads in the industrial space, a holy grail of data touchpoints that provide a real time view of the entire lifecycle of a product or a specific process, from design all the way to end of life. This has largely out of reach for most industrial companies for two key reasons:

1. The data problem: Fragmented, siloed, and uncontextualized mountains of data across a heterogenous stack of technologies and modalities, that require prohibitive investments in data science techniques to be able to leverage for a specific use case, with little scalability.
2. Return on investment (ROI): Traditionally, it has been difficult to prove ROI for digital thread initiatives, partly due to the challenges presented by the data problem, and partly because of the complexity to action on insights, from cultural resistance to skills gaps, to mention a few factors.

Microsoft, alongside partners like PTC, believe we are at the pivotal moment where digital threads are becoming an attainable reality for industrial customers due to two key innovations. First, the rise of unified data foundations that make data usable by securely sourcing it from systems like customer relationship management (CRM), product lifecycle management (PLM), enterprise resource planning (ERP) and manufacturing execution system (MES), and automating the contextualization aligned to any given standard or custom data model.

Secondly, the rise of generative AI, specifically, AI agents that reason using this unified data foundation and provide insights or take actions—unlocking thousands of use cases across the manufacturing value chain.

The role of AI agents

AI agents are sophisticated software systems designed to automate complex analyses, support decision-making, and manage various processes. They are productivity enablers who can effectively incorporate humans in the loop through the use of multi-modality. These agents are designed to pursue complex goals with a high level of autonomy and predictability, taking goal-directed actions with minimal human oversight, making contextual decisions, and dynamically adjusting plans based on changing conditions. AI agents can assist in various business processes, such as optimizing workflows, retrieving information, and automating repetitive tasks. They can operate independently, dynamically plan, orchestrate other agents, learn, and escalate tasks when necessary, however, AI agents are only as good as the data used to train the models that power them, and the current landscape of AI agents in the industrial space is domain specific, so these agents are confined to exclusively operate within the constraints of a single data domain, for example a CRM agent or an MES agent.

A leading example of domain specific agent is PTC’s Codebeamer Copilot. The Codebeamer Copilot supports software development process for complex physical products, like software-defined vehicles. Codebeamer Copilot leverages the Codebeamer data graph, for a connected and comprehensive view into the product development process. From requirements management to testing to release, the Copilot provides rapid insight into key areas of application lifecycle management (ALM). The result is automated requirements handling, enhanced quality control, and boosted productivity due to drastically reducing the time it takes for engineers to write and validate requirements.

Application Lifecycle management is just the beginning. The AI-powered digital thread provides agents with the combined knowledge of the entire manufacturing data estate, with multiple domains: removing their previous limitations confining them to one function.

Real-world applications of AI-powered digital threads

The era of AI and digital threads has arrived, and it’s delivering real value for the world’s leading manufacturers today.

Schaeffler

A manufacturer of precision mobility components faced a need to modernize data management, as its data previously took days to decode. Their goal was clear: find a scalable solution to uncover factory insights faster. An agent was implemented to allow frontline workers to immediately uncover detailed information when faced with unexpected downtime. This allows operators to get the line running again faster, reducing costly delays in production.

Bridgestone

The world’s largest tire and rubber company leverages manufacturing data solutions in Microsoft Fabric to accelerate the productivity of their frontline workforce. As a private preview customer, in collaboration with a Microsoft partner, the company uses digital thread and AI technology to address key production challenges, like yield loss. The query system solution enables frontline workers, with various levels of experience, to easily interact with their factory data, and efficiently uncover insights to improve yield, and enhance quality.

Toyota O-Beya

Toyota is leveraging AI agents to harness the collective wisdom of its engineers and accelerate innovation. At its headquarters in Toyota City, the company has developed a system named “O-Beya,” which means “big room” in Japanese. This system consists of generative AI agents that store and share internal expertise, enabling the rapid development of new vehicle models. The O-Beya system currently includes nine AI agents, such as the Vibration Agent and Fuel Consumption Agent, which collaborate to provide comprehensive answers to engineering queries. This initiative is particularly crucial as many senior engineers are retiring, and the AI agents help preserve and transfer their knowledge to the next generation. Built on Microsoft Azure OpenAI Service, the O-Beya system enhances efficiency and reduces development time.

The road ahead

The journey to fully realizing the potential of AI-powered digital threads involves phased implementation. Starting with identifying the right use cases aligned to business goals, where AI agents can play a role. Secondly, identify if the right data is available and in the right standards for usability. Lastly, quickly proving value by implementing a set of initial use cases with a minimum viable digital thread and measuring and socializing its results. Achieving the AI-powered digital thread with the Microsoft Cloud for Manufacturing capabilities:

• Azure adaptive cloud approach to source data from the edge, while supporting application modernization following cloud patterns.
• Partner applications as systems of records, like PTC Windchill.
• Microsoft first party manufacturing agents, like Factory Operations Agent in Azure AI Foundry, to unlock high-value factory use cases.
• Microsoft AI platforms like Azure AI Foundry and Microsoft Copilot Studio to support development and orchestration of custom AI agents.
• Partner applications with agentic AI capabilities embedded, for example PTC ServiceMax AI.

Learn more

• Read the PTC whitepaper on AI-powered digital threads authored in partnership with Microsoft.
• Watch the Microsoft video series with Forrester and NVIDIA on AI-powered digital threads.
• Join us at Hannover Messe 2025 to see the AI-powered digital thread come to life.

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The post Unlocking the future of manufacturing with AI-powered digital thread appeared first on Microsoft Industry Blogs.

1. AI makes retail more human—not less 

AI makes retail more human not less, creating engagement that delights consumers and empowers employees to solve problems, and deliver memorable customer experiences. At NRF, it truly hit home that “workforce” now includes both humans and their AI companions.

We learned how a beauty and wellness consumer goods brand uses digital twin assets to spin up a targeted lipstick Instagram campaign in minutes, then test and launch it—all of which would have taken days previously. In another presentation, we saw how a fashion retailer connects physical with digital, using ambient intelligence, in-store RFID signals, and AI to help associates locate garments and make recommendations for customers.  

“Can you repeat that, please?” The MediaMarktSaturn’s MyBuddy voice-navigated in-ear AI agent enables store associates to “shop” the store catalog for the best products and services while in the middle of customer conversation. This solution not only boosts customer satisfaction, it also helps associates make the most of conversion opportunities at the point of sale while delighting consumers. Do you want the expertise of a seasoned employee in minutes? Associates at Nordic retailer Kappahl can now use Store Operations Agent to gain access to product information, store policies, and procedures in mere seconds.

AI Is Already Changing Work—Microsoft Included gets at the heart of the changes brought about by AI. “The key to getting a real return on your AI investment is a human-centered approach, enabling individuals to leverage these tools in service to their work.”

2. The frontline is first in line with AI 

The frontline is first in line with AI. It’s very exciting to see how technology empowers people on the frontlines of retail, allowing them to thrive, grow, and be the best brand ambassadors to customers. At NRF 2025, we heard how a grocer employs generative AI to aid in training its 275,000 frontline associates while another automates responses to common customer inquiries and translates training materials to make its top employees available for more complex customer inquiries. A fashion retailer provides their employees with their app, which addresses queries like, “The register is slow. What should I do?”  

Curious about the hottest topics store associates are buzzing about? Swedish retailer Lindex designed Lindex Copilot to not only provide tailored guidance and support to store associates but also to learn and understand better what stores need. Generative AI is great for creating a bidirectional learning highway. Got a sweet tooth? Store associates at gourmet chocolatier Venchi are empowered by both hyper detail about the product and customer insights to meet the varied chocolate needs of shoppers, achieving customer satisfaction of 4.9 out of 5.

The best part is that savings achieved using AI can be reinvested to create a better employee experience, fostering a work environment where employees are enthusiastic ambassadors of the brand, bringing life to the store and to the customers who walk in every single day. 

3. Gen Zalpha defines the post-omnichannel world 

Gen Zalpha defines the post-omnichannel world, where authenticity, discernment, and relatability rule. Zalphas—a portmanteau of Gen Z and Alpha—use social commerce, participate in live commerce, and watch influencers via video storytelling to engage with products, brands, and creators.  

Gamified experiences and blended digital and physical worlds are critical for these consumers. Virtual shopping through gaming platforms blends digital and physical realms. You can find Zalphas creating avatars for themselves and taking their avatars shopping, buying virtual t-shirts for $13, and acquiring virtual manicured nails—in the way that everyday gamers make in-store purchases of speedier cars or accessories intended for game play. One retailer launched its real-life apparel line based on the popularity of the digital apparel collection they had created for avatar shoppers—the clothes were virtual-first. The opportunities for collaboration with technology companies, influencers, and communities are endless, as is the opportunity between virtual and real worlds.  

“Do I need winter or all-season tires?” Recognizing that up to 80% of tire purchases start with a visit to a retailer’s website with customers searching for tires, Canadian Tire’s conversational commerce helps them identify the right tires early on, growing conversion and brand loyalty. A beauty retailer shared at NRF how customers that order online and pick up in store drive the highest average order value (AOV).

“What backpack should I get for my kindergartener?” Customers using the voice ordering and text-to-shop features in the Walmart app can now interact with human-like responses as they search for items, place orders, and schedule pickups or deliveries.   

“What kind of pruning shears do I need for my climbing roses?” Gardens Alive is transforming customer service, enabling unique customer experiences by answering inquiries, tailoring recommendations, and creating seamless self- and assisted-service experiences that win customer loyalty while simplifying operations.

Retailers are working to improve how they track and connect online and offline sales to identify insights, find directly profitable use cases for AI, and reestablish attribution metrics to fully capture this interconnected online and offline relationship—also known as “show me the money.” 

4. The physical store is back 

The physical store is back, enchanting customers with memorable experiences aligned with their purpose. With stores still driving over 80% of sales, retailers are finding new ways to ensure the store expresses their brand’s values through new experiences.¹  

An outdoor retailer offers jacket repairs to emphasize the timelessness and durability of their products, a jeans shop creates the perfect fit with an in-store tailor, a toy store hosts in-store magic shows, a sports retailer debuts a community-style trying area to capitalize on the community built around sneaker culture, and a pet retailer offers self-service dog wash stations. Each of these experiences require, you know it, humans!

In addition, retailers are launching store tech innovations like virtual try-ons, digital shelves, and mobile checkout (25% of one beauty retailer’s sales). A big box retailer has built 1,700 digital twin models of store layouts. Why? To track in-store customer experiences, buying patterns, and preferences. All to optimize conversion. Do the hammers belong on the top shelf or middle shelf? Do we need eight colors of swimsuits or 12? This year at NRF, we saw an AI digital display interface that sits on top of a real-world shopping cart, displaying promotions and recommendations based on what the customer places in their basket.  

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5. Improving supply chain resilience 

Improving supply chain resilience continues to be in the spotlight. Supply chain discussions centered on using technology to optimize inventory, grow resilience, and decrease the risk and cost of disruptions. Pre-orders and just-in-time production—selling inventory before it physically exists—fundamentally rebalances inventory risk. SPAR Austria Group is using AI-enabled demand forecasting system that achieves 90 percent inventory prediction accuracy. 

Direct-to-consumer models reduce the risk of over-production, mis-forecasting, and physical risks to in-warehouse inventory (fire, flood, theft). By creating digital twins of a distribution center with different layouts and different behavior tracking, brands can pick, pack and ship products smarter and faster. One big box store uses digital twins of their warehouses to model efficiency changes to routing inside the warehouse. If an incident occurs, this approach allows automatic rerouting of warehouse robots to maintain flow and operations.

Leading Australian retailer Coles is expanding its world-leading edge computing platform to connect and manage IoT devices across Coles’ supply chain and into stores to advance Coles’ sustainability goals, improve customer experiences, reduce stock loss, and boost team member productivity and safety. British fast-fashion retailer ASOS uses AI to pull and embed knowledge of trends as they surface, enabling them to pick, curate, and share the right items at the right time with shoppers.

Geopolitical discussions are centered on onshoring manufacturing and sourcing for strategic categories. Producers have been making things wherever it was more efficient, and rebalancing supply chains and manufacturing takes time.  

6. Sustainability, ethical retailing, and circular economy 

Sustainability, ethical retailing, and circular economy remain top of mind as retailers are under pressure to meet 2030 sustainability targets and respond to rising consumer demand for responsible practices. For example, recycling expired products into biofuel and livestock feed. Brands are placing more emphasis on eliminating food waste, traceability, eco-friendly products and packaging, circular supply chain, overall waste reduction, renewable resources, and take-back or resale programs.  

A consumer goods company aligns sustainability with profitability by tracking environmental impacts across its product lifecycle assessing environmental footprints while streamlining operations.

Can we save more than 250,000 kilos of food from going to waste? Grocer Albert Heijn is using generative AI tools to help food arrive with maximum freshness, dynamically discounting prices to encourage shoppers to buy before that food is no longer fresh.

7. Customer psychographics drive true personalization 

Customer psychographics drive true personalization, whether it’s translating foot traffic data into a full snapshot of the customer journey or driving conversion in a post-cookies world.  

One of the biggest opportunities brands have is to use technology to understand their customers at their core: what makes them tick, what makes them buy, what causes them not to buy. The customer is smart, and authenticity is key to personalization. I love how a sports retail startup designs running clothes for runners, by runners, tapping into the community and speaking directly to Gen Zalpha’s desire for authenticity and connection.

“What shoes do I want for the holidays?” Saucony optimized customer acquisition during Black Friday and Cyber Monday via a custom AI model developed in partnership with Yobi, leading to a strong surge in new customers in just a matter of weeks. Are active women looking for waterproof mascara or color-correcting powder? The Estée Lauder Companies’ AI-powered custom agent connects and streamlines information for marketers, helping turn insights into action based on data that spans its 25 brands and hundreds of regions. 

Brands need to get personal in a meaningful way. Life shouldn’t be about shopping. Shopping should be about life.

Better shopping experiences through human–technology partnerships 

From AI to sustainability, NRF 2025 was a whirlwind of innovation and insight. As we move forward, the key takeaway is clear: retail is about people—both customers and employees—and the tech that makes those connections meaningful. Here’s to a future where technology and humanity work hand in hand to make the shopping experience better than ever.

Learn more

• The AI Advantage: How retailers are shaping customer experiences with data-driven insights
• Microsoft Cloud for Retail

¹ MIT Sloan School of Management, 2024.

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