‘The opportunity for partners around delivering a managed service to help customers get value out of their agents, tune their agents, secure their agents and govern and manage them is massive,’ Microsoft Commercial CEO Judson Althoff tells CRN.
As the “proud owner of IT inside Microsoft,” Commercial CEO Judson Althoff didn’t want to guess; he needed to know. So last November as the company was preparing to launch its new Agent 365 observability and control plane offering to users in the Microsoft Frontier early access program, he asked his team to run the technology internally first to see what it would find.
The results, even for a company with the technical wherewithal of Microsoft, were stunning: 500,000 AI agents generating 65,000 responses per day over a 28-day period.
“As a technology company, we were even overwhelmed by the amount of agents happening and being used in our environment, so you can only imagine what our customers are going to go through,” said Althoff in an interview.
It’s that sense of overload that Althoff says opens the door to a huge opportunity around AI agents for Microsoft solution providers, not only to guide customers through the workplace AI revolution, but to do so at scale in a secure, trustworthy way.
“The opportunity for partners around delivering a managed service to help customers get value out of their agents, tune their agents, secure their agents and govern and manage them is massive,” Althoff said. “Most of the commercial customer base out there is not going to be equipped to be able to handle managing these agentic processes, so [we’re looking at this] both from a build opportunity and a manage opportunity. It’s why I’m convinced that the opportunity for our partners has never been greater.”
Althoff’s vision for how Microsoft’s global channel ecosystem of around 500,000 partners will succeed in the AI era is for them to marry technical depth, industry expertise and repeatable, recurring revenue through managed services.
“AI success really is not about the best model; it’s not about the best silicon,” Althoff said. “It is about intelligence and trust and unlocking that for our customers. And our partner ecosystem is really the only way we’re going to actually get out there and achieve it. I view it actually as a competitive advantage for Microsoft to have the partner ecosystem that we have.”
Now, Microsoft has “pivoted our entire portfolio of capabilities around delivering an intelligence platform and a trust platform,” Althoff said.
To support that pivot in the wake of agentic AI, Althoff’s call to action for solution providers is to build practices that embed AI deeper into a customer’s business.
“Our partners have a massive opportunity to go build practices, to build out those agents by line of business, by industry, connect them back into Copilot so you get these end-to-end agentic business processes, and then have the opportunity to govern and manage those scenarios on behalf of our customers,” he said.
The work Microsoft and its channel partners have done to focus on building up services capabilities, particularly over the last 10 years, positions them well to succeed together in the AI era, said Althoff, who stepped into his role about eight months ago after serving as Microsoft’s executive vice president and chief commercial officer since 2021.
‘Our best partners are the ones that have gone out and built real, bona fide service practices or brought companies in to build in organically those kinds of capabilities.’
—Judson Althoff, Commercial CEO, Microsoft
“I feel like we have been telegraphing for a decade that where this is all headed is in service delivery. … Our best partners are the ones that have gone out and built real, bona fide service practices or brought companies in to build in organically those kinds of capabilities, and I feel like that industry knowledge—that core expertise and development and the core long-term service ability and managed services—is what is going to prevail in this new AI world,” he said.
Opening Up AI Model Choice Across Copilot And Foundry
Microsoft’s investment in solution provider capabilities around AI agent monitoring through tools like Agent 365 helps enable safer AI deployments through agent governance and granular data access controls and also provides a way to track customer ROI, said Althoff.
Agent 365, for example, shows Microsoft and third-party agents as well as their behaviors in the environment.
This comes as Microsoft has been working hard for the better part of the past year to open up Copilot to expand AI model choice as well as integration with other cloud platforms.
“You can connect to agents built with any model that sits on top of our Foundry platform, and our Foundry platform has over 11,000 different models in it,” Althoff said.
And while Microsoft, of course, sees Azure as the cloud platform of choice, customers have other options.
“If [customers] build agents on the Google platform or the [Amazon Web Services] platform, it’s very easy to connect them back into Copilot now and then manage them with Agent 365,” Althoff said.
Now Microsoft is training and educating its partner base to build up the skills required to support core practices around this build-and-manage paradigm, he said.
“We think that for partners, the biggest imperative is to learn the adjacent skills,” Althoff said. “The good news is they’ll already come from a place where they understand Microsoft 365 quite well, and so amassing the AI skills around that to then implement Copilot and build out the agent flows around it is a natural progression for them. And then I think the hardening of the managed services opportunities around the business model is something that we would encourage them to do as well.”
Meanwhile, Microsoft’s E7—made generally available May 1 as its first new enterprise license in about 10 years since E5—gives partners a new route to unlocking more AI applications, security and governance tools for customers further along on their AI journeys.
‘Client Zero’: How Solution Providers Leverage AI
Then there’s the opportunity for Microsoft solution providers of all sizes to reinvent themselves internally through AI tools.
London-based EY is one of Microsoft’s largest and closest global services partners, employing more than 10,000 Microsoft-certified professionals worldwide, winning more than 50 Microsoft Partner of the Year awards since 2020, including the Global Advisory Partner of the Year award for six consecutive years.
On May 21, EY and Microsoft revealed that they will jointly invest more than $1 billion over five years to accelerate enterprises’ AI transformation, with a team of EY practitioners and Microsoft forward-deployed engineers (FDEs) collaborating on AI products and services in core business functions at scale. EY is working to scale Copilot access to its 400,000 employees worldwide.
EY’s AI experimentation acting as “client zero” pays off in customer conversations because the firm’s internal case studies create trust in its capabilities, Janet Truncale, global chair and CEO of EY, told CRN.
“It’s very important for us when we go on and we talk to our clients that we have that credibility because we’re doing it to ourselves,” she said.
EY deployed Microsoft 365 Copilot to more than 150,000 employees, about 40 percent of its global workforce. The firm has seen a 15 percent boost in productivity through Microsoft 365 Copilot, the EY.ai AI platform and EYQ conversational AI assistant. EY leveraged Microsoft Copilot Studio to build an EY PortalOne agent that provides instant access to more than 21 million EY publications, legislation, templates and other documents.
More than 80 percent of EY professionals use EY.ai EYQ, and more than 80 percent have completed foundational AI training, according to the solution provider. EY.ai has helped with experimentation and development of more than 50,000 AI agents.
In another example, EY has leveraged Azure AI Document Intelligence to reduce manual workload by up to 90 percent, processing about 80,000 federal and state tax forms spanning 720,000 pages of structured and unstructured data.
‘The real power of this alliance relationship [with Microsoft] will be as our clients are transforming more significantly and embedding AI into their core processes, their workflows.’
— Janet Truncale, Global Chair, CEO, EY
The firm has leveraged AI capabilities in Microsoft’s Power Automate for its PowerMatch system, which will soon clear 1.5 million client payments a year, increasing the percentage of payments automatically matched and cleared from 30 percent to 80 percent. Only 5 percent of payments now need manual processing. PowerMatch should save about 230,000 hours a year for EY once rolled out globally.
“The real power of this alliance relationship will be as our clients are transforming more significantly and embedding AI into their core processes, their workflows,” Truncale said. “That’s the biggest unlock that I see for us [with] Microsoft: our clients pivot[ing] from this bolt-on to built-in use case to really [having it] embedded. That’s where this alliance relationship will continue to accelerate.”
Another of Microsoft’s biggest solution providers transforming for the AI era is Stans, Switzerland-based SoftwareOne, which has 13,000 employees across 70 countries and has won multiple Microsoft Partner of the Year awards, including eight in 2025.
The solution provider delivers 24-hour support via more than 3,000 Microsoft-certified professionals in 12 global delivery centers, according to SoftwareOne. It holds six Microsoft solutions partner designations and 15 advanced specializations.
Melissa Mulholland, co-CEO of SoftwareOne—No. 49 on CRN’s 2025 Solution Provider 500—said her company is evolving from licensing-focused advising to an outcome-based approach.
‘I always say we’re a trusted adviser to the customer. Where that’s shifting is from licensing advisory to AI advisory and AI economics. This is something very core to who we are.’
— Melissa Mulholland, Co-CEO, SoftwareOne
“I always say we’re a trusted adviser to the customer,” she said. “Where that’s shifting is from licensing advisory to AI advisory and AI economics. This is something very core to who we are.”
Internally, SoftwareOne has a 97.7 percent adoption rate with Microsoft 365 Copilot, exceeding the 70 percent industry average. The solution provider said it has seen 4.8 hours saved per month per employee through intelligent automation of routine tasks, meeting summaries and content creation.
And SoftwareOne has seen more than 3,500 AI agents created in-house through Microsoft’s Copilot Studio and Azure AI Foundry offers. This includes the Q-Bot agent for automating supplier questionnaire completion—which took task time from 20 minutes to 10 seconds—and an auto-dispatching agent to automate customer email triage and routing.
Some of its most impressive publicly disclosed case studies include leveraging Microsoft 365 Copilot to save users within insurer Ascot Group up to four hours per week on average and saving Prague Airport staffers up to two hours a week through Copilot.
Smaller MSPs See AI As Business Model Evolution
It’s not just global systems integrators that are tapping into the Microsoft AI opportunity.
One of Microsoft’s smaller solution providers positioning itself as an AI maestro is Allen, Texas-based 5K Technical Services—an honoree on CRN’s 2026 MSP 500 and home to seven full-time employees.
CEO Corey Kirkendoll said that he’s using Microsoft AI tools to reinvent internal marketing, business operations and service delivery, taking those learnings back to his customers, many of them small and midsize businesses.
“We have got to eat our own dog food,” Kirkendoll said. “It positioned us in a very unique way to have conversations with our customers about what we’re doing.”
He hopes to leverage AI to evolve beyond the MSP business model, a model that the AI era might commoditize as traditional IT processes become automated through AI agents.
Kirkendoll is exploring an “AI pathways” business he’s building out separately from his traditional business to help customers develop their AI road maps, emphasizing business process training, employee buy-in and culture transformation for sticky AI transformation.
“AI pathways, if it’s done correctly, and where we are today, will far surpass anything we’ve ever done on the MSP side” with fewer resources, he said. “That’s the cool part.”
Another smaller solution provider making waves in AI is Luis Alvarez, CEO of Salinas, Calif.-based Microsoft solution provider Alvarez Technology Group—an honoree on CRN’s 2026 MSP 500 with around 24 full-time employees.
Alvarez and his team are leveraging Copilot reporting and dashboards that manage customers’ AI estates and show the return on AI investments.
He recalled talking to an attorney client about his $500 hourly rate. If a $30-per-user-per-month Microsoft 365 Copilot license saves him just 45 minutes of billable time a year, it effectively pays for itself.
“People do realize very quick ROI,” Alvarez said.
How Microsoft Is Helping Partners Navigate AI Disruption
SoftwareOne’s Mulholland holds the distinction of working with Althoff and his team not only as a solution provider executive but as a Microsoft employee of 12 years, leaving in 2020. In her final role as Microsoft’s director of cloud enablement and profitability, she helped train more than 3 million people and drove more than 100,000 certifications across the ecosystem.
Moving to the solution provider side of the Microsoft ecosystem has given Mulholland a greater appreciation for the help Microsoft has provided licensing-based partners transitioning to the consumption economics brought by cloud computing, she said. Microsoft’s training and skilling resources help remove risk from solution provider investments in this latest technology wave.
“This change management across an entire partner ecosystem, which is so embedded into Microsoft, is delicate,” she said. “That’s where the trust comes in in how we work together.”
‘One of the things that we’re really proud of at Microsoft is the breadth and depth of our partner ecosystem and the fact that they light up our platform innovation with their unique capability to deliver value to customers.’
—Nicole Dezen, Chief Partner Officer, Corporate VP, Global Channel Sales, Microsoft
As Nicole Dezen, Microsoft chief partner officer and corporate vice president of global channel sales, told CRN in an interview, “One of the things that we’re really proud of at Microsoft is the breadth and depth of our partner ecosystem and the fact that they light up our platform innovation with their unique capability to deliver value to customers.”
“We’re putting the finishing touches on our FY ’27 plans right now, and partners are at the center of everything we’re doing,” Dezen said. Microsoft’s 2027 fiscal year starts July 1.
Althoff “is very deep on the work that we do with partners, very committed to ensuring that we are finding ways to deliver growth with and through our partners in the ecosystem, and ensuring that partners can build healthy, durable, profitable businesses with Microsoft,” Dezen said.
In recent years, Microsoft solution providers have had to navigate major, complex changes including the rollout of new commerce experience (NCE), the launch of the solutions provider designation point system that replaced the classic Gold and Silver tiering system and now the availability of E7 licenses.
The upheaval brought by AI to their customer base and their internal operations is another challenge partners face.
To help overcome those hurdles, Microsoft in the months ahead will update its “frontier distributor” designation so that solution providers can better identify distributors that can deliver repeatable training, enablement for building and managing agents, Microsoft Marketplace-backed motions for transacting and growing agent sales and other capabilities for scaling agentic AI in the channel. Distributors such as Ingram Micro and TD Synnex already have the designation.
Over the next 12 months, Althoff hopes to see more “impactful frontier transformation scenarios come to life across our customer base” through applied AI enabled by partners. Althoff clarified that “transformation” in the AI era isn’t only about efficiency and reducing costs.
“‘Transformation’ is probably the most overused word in our industry right now. Everybody talks about it, unfortunately,” Althoff said. “Most people have used the word over the last couple of years to mean efficiency … which then, of course, has the negative connotation of talking about job loss. The reality of the situation is AI has so much power to unlock creativity, unlock innovation, and really push and pivot toward growth, and so we use the term ‘frontier transformation’ and to talk about democratizing intelligence.”
Frontier AI transformation can mean more innovation and democratized intelligence throughout an organization, according to Althoff. “And these frontier transformation scenarios come from a place of actually understanding the business flows and the business opportunity,” he said. “I want to see AI unlock growth for our customers, powered by our partner ecosystem. And I think we have a great opportunity to make that happen.”
