The one-line summary: If your business already pays for Microsoft 365, Wave 3 has quietly put agentic AI automation inside the apps your team uses every day — no new software to buy, no separate tool to learn, and no integration work to do. The question is whether you have spotted it yet.
What Wave 3 is — and why this update matters
Microsoft Copilot has gone through three distinct phases since its launch. Wave 1 was Copilot as a writing assistant — single-prompt suggestions inside apps. Wave 2 added deep integration across M365 apps, cross-app data access, and a centralised Copilot Chat pane. Wave 3, announced at Microsoft Build in March 2026 and rolling out in the June 16 update, is the shift from assistant to agentic execution platform.
In Wave 1 and 2, Copilot would suggest the next sentence, summarise a document, or draft a reply. In Wave 3, Copilot can execute multi-step tasks: research a topic, draft a proposal, format it to a template, and prepare it for review — without you switching apps or issuing individual prompts for each step. The task runs in the background. You review and approve. The cognitive overhead of managing the steps moves from you to Copilot.
The June 16 update also added two significant model options inside M365 Copilot: Claude Opus 4.7 (Anthropic's most capable model) and GPT 5.5 Instant (OpenAI's low-latency version). M365 Copilot users can now select which model powers their Copilot session, depending on the task. This is a meaningful change — M365 is no longer locked to Microsoft's own models. You can use Claude inside Outlook.
Three practical use cases for UK SMBs
Use case 1: Word — draft, research, and format in one agentic task
The old workflow: you open Word, write a brief, switch to a browser to research, paste information back into Word, manually format the document to your template, review and edit. The Wave 3 workflow: you open a Copilot agentic task in Word, describe the proposal you need (client name, project scope, objectives), set the output template, and Copilot handles the research, drafting, and formatting as a single governed task. You review the completed draft. The result is the same Word document you would have produced — without the context-switching and manual assembly steps. Use case: service proposals, scopes of work, client-facing reports, onboarding documents.
Use case 2: Excel — pull live data, run analysis, summarise findings
Excel's Copilot Wave 3 capabilities extend to agentic data tasks: connecting to live data sources within M365 (SharePoint lists, Power BI datasets, Teams channels), running specified analyses, and generating summary outputs — without requiring you to set up manual data connections or write formulas. The practical use case for UK SMBs is financial and operational reporting: monthly revenue summaries, project status roll-ups, inventory or booking analysis. If your business data already lives in M365 (SharePoint, Teams), Wave 3 Excel automation could reduce the time spent on regular reporting tasks considerably.
Use case 3: Outlook — draft, schedule, and follow up as a governed multi-step workflow
Outlook's Wave 3 addition is the most immediately accessible for most businesses. Agentic tasks in Outlook can handle a complete communication sequence: draft an initial email to a contact, schedule a follow-up for three days later if no reply, and prepare a summary of the thread for your review — all as a single configured workflow, not three separate manual steps. This is relevant for client onboarding sequences, quote follow-ups, supplier communication, and any situation where your current process involves manually remembering to follow up. The governance layer means all outgoing emails still pass through your review before sending — the agentic task prepares, you approve.
Who this is for — and what it costs
If you are already paying for Microsoft 365 Business Standard or Business Premium with Copilot included, the Wave 3 update is already available on your account. If you have M365 but Copilot is not currently enabled, Copilot is available as an add-on at approximately £25–30 per user per month. Wave 3 features are not available without the Copilot licence. For businesses on M365 Basic (the entry-level tier), Copilot is not available — you would need to upgrade to Business Standard or higher.
The key point for UK SMBs is that the integration work is done. You do not need to build anything, connect APIs, or manage a separate AI tool. Microsoft has embedded the capability into software you are already paying for and your team already knows how to use. The question is whether your current M365 licence includes Copilot, and whether you have explored what it can now do.
What to do this week
Action: check your M365 Copilot access and explore the agentic task palette
Step 1: Log in to your Microsoft 365 admin centre and check whether Copilot licences are active for your users. If you are not the admin, ask your IT contact. Step 2: If Copilot is enabled, open Copilot Chat inside Word or Outlook and look for the option to create an agentic task (the interface has evolved from "prompts" to "tasks" in the Wave 3 update). Step 3: Identify one workflow your team currently does manually that fits the agentic task model — proposal drafting, follow-up sequences, weekly reporting. Try it. You do not need to commit to a new process. You need to see what is now possible inside the tools you already use. If Copilot is not yet enabled on your M365 licence, check whether the productivity improvement justifies the £25–30 per user per month add-on cost for your most time-heavy team members.