Microsoft, having brought artificial intelligence to its battle with Google over search, is now turning to the latest AI technology to catch up with rivals in the corporate applications market — companies such as Oracle, Salesforce and SAP.

The software giant is introducing an AI assistant — called Dynamics 365 Copilot — for applications that handle tasks such as sales, marketing and customer service. Based on technology from OpenAI, the software can draft contextual chat and e-mail answers to customer service queries. It can help marketers come up with customer categories to target, and write product listings for e-commerce. The new capabilities have been released in preview form and are being tested by hundreds of early customers. For example, Italian apéritif maker Campari is trying out the marketing tools to concoct targeted campaigns for events around the Negroni cocktail.

Microsoft also said its next set of AI announcements, planned for 16 March, will relate to “workplace productivity”, a term the software maker usually uses to mean Office software.

Business applications are the latest Microsoft programs to get an AI makeover so far this year as the company adds language-generation tools and chatbots to everything from its Bing Internet search engine to the Teams corporate conferencing software. The strategy follows a successful debut for an AI programming tool called GitHub Copilot last year and Microsoft’s expansion of its investment in OpenAI, the maker of ChatGPT, in January. CEO Satya Nadella has said the company plans to overhaul its whole product lineup using AI and tools from OpenAI.

In the business applications category, where Microsoft has operated for more than two decades but lagged behind rivals, Nadella ultimately wants to use AI to break down silos between formerly separate programs, each with their own workflows, like ERP (enterprise resource planning) and CRM (customer relationship management) software. Instead, he said, they should be blended and have one AI copilot that can retrieve information and help workers with tasks. Still, like the Bing bot, Nadella noted Microsoft’s Dynamics tool will also make mistakes.

Consumer attention

“ERP, CRM, marketing, customer service, supply chain — all these distinct categories are all made up, right? I mean, they’re all garbage sort of categories thought up by vendors,” said Nadella, whose first executive role at Microsoft was running an early Internet-based version of business applications called bCentral. “What if we said, there was just one Biz App workflow?”

New generative AI systems such as ChatGPT and Dall-E have caught broad consumer attention in the past year, leaving businesses scrambling to figure out how and whether they should employ corporate aspects of these content-generating tools. At the same time, the AI gold rush is provoking anxiety as programs make errors and go awry. Some banks have banned the use of ChatGPT, and other firms are asking workers not to share confidential information with the systems or expressing concern about how private corporate data will be treated by AI products in use.

But most companies can’t seem to stop talking about AI and how the technology is potentially transformative for their business.

For customer service representatives, Microsoft says its copilot will comb through a company’s materials and a customer’s case history and can offer answers based on that knowledge. Nadella also noted that his company won’t use customer data for Microsoft’s own purposes.

“If you think of a customer service agent, he’s dealing with a customer inquiry and 18 different databases internally to come up with the responses,” Nadella said. “Now you have this copilot that allows you to interrogate the 18 databases and craft a response” without distracting the agent from the customer, he said.

Marketers can have chats with their customer data software in plain English to develop targeted customer groups and also get suggestions for additional segments they may not have thought of. The bot will also help them get creative, making suggestions for e-mail campaigns based on topics and requested tone — users can choose from categories like formal, luxury or adventurous, said Charles Lamanna, Microsoft’s vice president for business applications and platform.

The software giant last month also unveiled AI technology that writes e-mails for busy salespeople. Now it’s adding a sales feature that generates e-mail summaries of Teams conferences and pulls out specific actions people committed to completing. In the future, Microsoft will connect those to calendars. For example, if the call attendees discuss holding another meeting in a few weeks, the software will schedule it, Lamanna said.

Creating chatbots and assistants for business uses is different from asking a search bot to give open-ended answers on queries about, say, a meal plan for kids or a trip to Mexico — scenarios Microsoft promoted for the Bing chatbot. Business products rely on a more specific set of information — a Microsoft client’s own data, for example — rather than a wide swathe of information available on the Internet. That may make it easier to get correct answers, but also can make the stakes higher if the AI goofs and makes a user uncomfortable or botches financial data. Both are issues that have cropped up for Bing.

Read: Elon Musk: ‘AI stresses me out’

Nadella said the technology will make mistakes, and the humans using it need to check the facts.

“That’s why I care a lot about not just the power of the tech, but the use case and the design of the products,” Nadella said, “so that we can remind ourselves of both the social norms and responsibilities we as humans have, and the power of this technology and the error bounds of this technology.” — (c) 2023 Bloomberg LP