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Top KPIs to Measure When Scaling Microsoft Copilot Across Your Organization & 6 Techniques to Assess ROI

Kicking off 2024 with a bang, I found myself immersed in the electrifying atmosphere of the Microsoft AI Tour in New York City, a hub buzzing with groundbreaking innovation centered on the integration of Copilots in the workplace. The keynote was a revelation, unveiling impressive benchmarks that showcased the transformative power of Microsoft Copilot at work. For example, 75% of people using Copilot spent less time on information hunts, 71% experienced a reduction in the tedium of everyday tasks, 3.5x of individuals felt a speed boost in catching up on missed meetings, and an average of 1.2 hours were reclaimed each week per candidate!


As we stand on the brink of this AI-driven era, it’s crucial for business leaders to not just adopt, but also adeptly measure the impact of these innovative tools. Doing so is the key to unlocking their fullest potential and achieving high returns on this investment. 


As many know, the purpose of implementing artificial intelligence within an organization is to enhance operational efficiency, streamline workflows, and foster innovation. As Microsoft's 365 Copilot splashes its way into the corporate environment, becoming the status quo for AI usage in workplace productivity tools, identifying relevant Key Performance Indicators (KPIs) to measure the impact has become business-critical for leaders to do. By doing so, this enables them to gauge the tool’s overall impact and effectiveness across an organization. In addition, mapping those KPIs to company-wide objectives is important to ensure there is measurable alignment between Copilot’s usage and the organization’s strategic goals. Although Microsoft conducted its own research to retrieve those impacts, many other enterprises and SMBs will have to figure out how Copilot is going to impact their own organization, and how to measure that impact.


For some initial context, let’s discuss some ways in which organizations can experience Copilot today:


  1. Microsoft 365 Copilot Integration: This involves embedding Copilot within various Productivity Apps like PowerPoint, Outlook, Teams, Excel, Word, etc., enhancing everyday work tasks with AI capabilities. This enables organizations and employees to have access to an AI agent that lives within their productivity apps and is trained on the related data to help them be more efficient on a daily basis.

  2. Copilot Studio for Custom GPT Creation: Similar to Power Automate, Copilot Studio allows for the user creation of custom GPT models. This low-code environment enables the creation of flows that can retrieve data from various IT systems within a business, integrating with other tools and platforms. There is also the ability to leverage Visual Studio code for building out custom GPT models from scratch using available APIs. It’s tailored for more technical, development-focused needs of an organization. This enables organizations to have custom copilot GPTs built and deployed in-house that are also trained on sales, marketing, financial, operational and even more proprietary data, making this a powerful AI agent to be utilized within the company. 


Understanding these pathways is crucial as the extent of an organization’s investment in the Copilot product suite can influence the specific KPIs they may be interested in measuring. Different deployment methods and use cases of Copilot will yield varying impacts and benefits, necessitating a tailored approach to evaluation and measurement. But for the purpose of this article, we will consider KPIs that can fall into either of those categories; however, it's important to note that the granularity of KPIs can increase in environments where Copilot is used more intensively for development purposes. This is because such settings allow for the integration of custom requests to track additional data points.


KPIs for copilot can be broken down into two main categories: AI Model Performance & Data Security and Productivity & Organizational Impact. Let’s get started with eight AI-driven KPIs that will be important for those who are in executive roles to be informed about, and tech administrative roles to be responsible for monitoring. 


  1. Accuracy Rate is crucial as it measures the correctness of Copilot's outputs in comparison to expected results, ensuring reliability in its functionality. For example, there can be an option to share feedback such as a document quality score (DQS) attached to Copilot’s document-based outputs and this can inform the accuracy rates across an organization.

  2. Response Time is a key metric that tracks the speed at which Copilot completes tasks or provides responses, which is critical in fast-paced work environments. A shorter response time can lead to faster decision-making and improved workflow, contributing to overall operational efficiency.

  3. User Adoption Rate is another significant measure, assessing the extent and frequency of Copilot’s usage within an organization, indicating its acceptance and practical utility. 

  4. AI Learning Rate evaluates how efficiently Copilot adapts to new data inputs or user feedback corrections, a critical aspect of AI's ability to evolve and improve over time. 

  5. Time-To-Edit is a quantifiable metric that reflects the duration between when Copilot completes a task and the moment a user initiates any edits or corrections to its output. It's an important indicator of the initial accuracy and usability of Copilot's responses.

  6. Algorithm Efficiency involves measuring the computational resources consumed by Copilot for its tasks, reflecting the efficiency and resource optimization of its underlying algorithms. Efficient algorithms reduce the need for extensive computational power, thereby lowering operational costs and optimizing resource allocation.

  7. Error Rate involves the frequency at which Copilot encounters errors or crashes during its operations. It quantifies instances where Copilot fails to complete a task, provides incorrect results, or unexpectedly stops functioning. A high error rate might indicate the need for additional training data or algorithm refinement. Reducing error rates ensures that the tool is dependable and trustworthy, which is crucial for critical business decisions and operations.

  8. Access Denial Rate measures the frequency of instances where Copilot denies a user's request due to access restrictions or security protocols. It tracks situations where a user requests information or actions that Copilot is not authorized to access or perform. A high access denial rate might suggest either over-restriction in Copilot's permissions, leading to limited functionality, or frequent attempts by users to access restricted data or functions.


Now, let’s dive into ten productivity and organizational KPIs that are crucial for tracking the success of a Copilot implementation:


  1. Copilot Adoption Rate: This metric measures the percentage of the workforce that has started using Copilot in their regular workflows. A higher adoption rate indicates greater acceptance and potential reliance on the tool across the organization.

  2. Copilot Engagement Rate: Unlike adoption, engagement rate tracks how actively and extensively users interact with Copilot. Metrics like frequency of use, diversity of features used, and duration of each interaction are key indicators here.

  3. Average Time to Complete a Task: This KPI measures the time taken to complete specific tasks with Copilot's assistance. It's a direct indicator of productivity improvements and operational efficiency.

  4. Innovation Rate: Tracks the rate at which new ideas, processes, or products are developed with Copilot’s aid. It reflects Copilot's contribution to fostering creativity and innovation within the team.

  5. Sales Volume Increase: Measures any changes in sales metrics post-Copilot implementation, providing insights into its impact on enhancing sales strategies or customer engagement.

  6. Cost Savings: This is a crucial financial metric, quantifying the reduction in operational costs attributed to the implementation of Copilot, including savings from labor, time, and resource optimization.

  7. Service Incident Rates: Tracks the frequency of service-related issues or incidents. A decrease in these rates may indicate improved efficiency and problem-solving capabilities with Copilot.

  8. Customer Conversion Rates: Measures the change in the rate of converting potential leads into customers post-Copilot implementation, which can be a direct indicator of improved sales tactics and customer engagement.

  9. Customer Satisfaction Scores: This metric assesses changes in customer satisfaction levels, which can be influenced by improved service quality, faster response times, and personalized interactions facilitated by Copilot.

  10. Quality Assessments Passed: Measures the rate at which outputs or projects involving Copilot pass internal or external quality assessments, indicating the tool’s impact on maintaining or improving work standards.


OK, now that we’ve talked about relevant KPIs to consider tracking, let’s talk about the obvious. How does someone know if the increases in revenue, efficiency, cost savings, or customer satisfaction are actually driven by the adoption of Copilot? This question remains pivotal, even as many executives have already invested in 365 Copilot. While it may seem straightforward to attribute these improvements to AI by comparing operational cycles before and after Copilot's implementation, this is rarely a black-and-white matter, especially since many of the metrics that would be useful to measure are granular productivity KPIs that most businesses have not captured at a detailed level. And yet, businesses don't operate in a vacuum; they're constantly evolving with new strategies, market approaches, and responses to competitive pressures. Therefore, attributing success solely to AI requires careful consideration of these dynamic factors. 


So to help businesses develop a deployment strategy for rolling out Copilots in-house, here are six strategies and steps to take to understand the transformative impact of Copilot within your organization:


  1. A/B Testing Departments with Control Groups: Pick a department where there is a larger group of individuals with similar day-to-day tasks and assign Copilot licenses to half of the individuals to compare performance and output after the testing period ends. Make adjustments based on your test findings.

  2. Task Value Categorization: Have employees breakdown their individual day-to-day tasks to be shared with management to then discern and categorize between high vs. low contributing value. Understanding workflow for employees is important so one can determine if Copilot frees them up for high-value work, or just more low-value work that has yet to be automated. This will also inform an AI-driven hiring process that understands what responsibilities should be excluded from a future job description versus which new ones should be included.

  3. In-depth Data Analysis: Survey the employees at all levels and consider using data analytics to quantitatively assess how time saved by Copilot is reallocated among tasks and visualize that data to leadership in accordance with metadata captured by the administrative view of Copilot such as adoption rates, top engaged users, etc. Consider also using advanced analytics techniques such as a correlation analysis and machine learning models to forecast future copilot usage rates across an organization.

  4. Develop Blended KPIs: Qualitative and quantitative KPIs that are worth measuring sometimes are custom developed related to operations and productivity, finance, or AI-specific metrics such as retrieval and generation accuracy, language model learning rate, or time-to-edit, to better capture Copilot's impact. Categorize your KPIs and match them to your organizational objectives, for example number of new products or services introduced by Copilot usage can be tagged to a pillar objective in an organization that drives innovation.

  5. User Feedback Enhancement: In addition to surveys, consider focus groups or interviews within the organization for more nuanced feedback. Offer non-financial incentives, like recognition or opportunities for professional development, to encourage participation.

  6. Include AI Adoption Into Employee Performance Metrics: Encourage metrics such as Copilot user engagement rates, innovation contributions, skills gained from cross-training or upskilling, and problem-solving efficiency be considered in performance evaluations for employees.


In conclusion, effectively scaling Microsoft's 365 Copilot within an organization requires a nuanced understanding of various Key Performance Indicators (KPIs) as well as effective Copilot deployment strategy in order to scale the product across a company and receive the highest ROI out of it. By measuring metrics such as model accuracy, response time, user adoption, and AI learning rates, on top of traditional financial and operational KPIs, organizations can gauge the true impact of this AI tool on operational efficiency, innovation, and workflow optimization. 


The challenge lies not just in the adoption of Copilot, but also in aligning its capabilities with the strategic objectives of the organization. As businesses continue to navigate the evolving landscape of workplace technology, embracing a data-driven and results-oriented approach to AI integration becomes crucial. This journey towards AI-enhanced productivity is not just about technological implementation but also about fostering a culture of continuous improvement and adaptability, ensuring that AI tools like Copilot are leveraged to their fullest potential for sustainable business growth and success.


 

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