Microsoft wants channel partners to create their own AI agents

Microsoft will now provide a variety of support for channel partners who embrace agentic artificial intelligence (AI), three months after Microsoft CEO Satya Nadella publicly stated that software-as-a-service (SaaS) will “collapse in the agent era”.

The software giant wants to help partners build AI-powered applications and agents for their customers, wrote Microsoft director data and AI digital app innovation Simran Sachar in a March blog to its partner community.

According to Sachar, Microsoft will provide partners with the “same secure, global platform that Microsoft uses for its own AI innovation globally distributed infrastructure, data, apps and AI services”.

The vendor will also provide “esteemed developer tools”, privacy, safety and security services. 

Sachar wrote that AI agents were redefining how businesses operate, automating, optimising and scaling innovation like never before on the Microsoft AI platform.

“This marks the next major paradigm shift in technology, unlocking new value for customers and partners,” he said.

This shift is being driven by the cloud which has expanded the capacity to connect and transform workflows.

“However, these advancements have also maxed us out, pushing human capacity to its limits,” Sachar wrote. “Generative AI (GenAI) unlocks impressive possibilities.”

“Agents can empower humans to achieve more, supporting us as personal assistants, grounded in our work content.”

For partners, Azure AI Foundry will provide the tools developers need through a simple portal, unified software development kit and application programing interfaces to accelerate the path to production, Sachar continued.

“In addition to the technology stack, we provide our partners with the resources needed for business growth,” he said. “The pace of the AI market has been unprecedented.

“To ensure that your business can grow with the demand, we recommend that our partners ensure they’re using the resources offered in each of the four pillars below to build and grow their AI practice.”

Collapse of SaaS apps?

The sentiments around channel partner development of agentic AI echoes that of its CEO Satya Nadella, who has been a big proponent of this type of AI.

He has publicly spoken about SaaS applications, or “biz apps from Microsoft’s own Dynamics”, during a December 2024 episode of the BG2 w/ Bill Gurley & Brad Gerstner podcast.

“I think the notion that business applications exist,” he said. “That’s probably where they’ll all collapse, right in the agent era, because, if you think about it, they are essentially CRUD [create, read, update, delete] databases with a bunch of business logic.”

“All that business logic is moving to AI agents, which will work across multiple repositories and CRUD operations. These agents won’t care about what the backend is. They’ll update multiple databases and all the logic will reside in the AI layer.”

Nadella said once the AI layer becomes the place where all the logic lives, people will begin replacing the backends.

“In fact, we’re already seeing high adoption rates of Dynamics backends and AI agents,” he said. “We’re pushing aggressively to collapse everything, whether it’s in customer service or other areas.

“Interestingly, this isn’t limited to CRM — even our finance and operations systems are increasingly AI-native. This means the logic layer of business applications will be orchestrated by AI agents.”

Gartner believes that by 2028, 33 per cent of enterprise software applications will include agentic AI, up from less than 1 per cent in 2024.

The benefits of having autonomous AI include increased efficiency, reduced costs and improved customer response times.

Through independent decision-making agentic AI, like Copilot from GitHub and Amazon Q Developer, in settings like software development can aid in coding and documentation and in service desks, where it can triage and categorise tickets.

Gartner vice principal analyst research IT operations Padraig Byrne told ARN this increases the potential to increase productivity across the organisation.

The next evolution in the IT channel

A big channel proponent of agentic AI has been iasset.com chief strategy officer Nick Verykios, who believes agentic AI is “redefining the role of artificial intelligence in business, moving beyond support functions to autonomously anticipate, act and optimise the entire customer journey”.

“These capabilities aren’t just a technological leap – they represent a strategic imperative,” wrote Verykios in a blog. “Businesses that embrace agentic AI will gain unparalleled agility, efficiency and profitability, setting a new standard for proactive and sustainable success.”

According to the Verykios, the shift from customer success to agentic success is more than a technological upgrade, it’s a redefinition of how success is measured in the IT channel.

“It’s about creating ecosystems where AI performs at a level that goes beyond human capabilities, delivering outcomes with greater speed, intelligence and efficiency,” he said.

In February, ARN reported that iasset.com had created a services platform that helps partners and distributors make the most of their existing customer data (installed base data), leveraging AI tools, including agentic AI.

“For the distributors that we have, we’re going to make them more powerful with some new tools that are going to continue to challenge their competitors in a big way,” Verykios said at the time. “Automating sales processes, maximising renewal conversion and enhancing lifetime value of installed assets remains the key driver. It will now be more accessible.

“We are entering distribution services in a bigger way and these innovative services will be provided through the vendor. We provide these services for vendor innovation on behalf of their channel, particularly for distributors.”

Balancing AI and human interaction

While the push for channel partners to create AI agents will herald a new era “unprecedented efficiency, they should not replace the human element entirely”, wrote Verykios.

“The true value lies in automating repetitive, time-consuming tasks, such as data entry, renewal tracking and quote approvals, so that people can focus on higher-value activities,” he said.

“Customer and partner relationships remain critical to long-term success and automation should empower teams to invest more time in strategic engagement, problem-solving and value-driven interactions.”

Gartner’s Byrne held similar sentiments. When it comes the local channel, Byrne said agentic AI offers several benefits particularly for managed service providers (MSP) and distributors.

“Channel partners can improve their operational efficiency, customer service and overall competitiveness in the market,” he explained. “This includes improved efficiency in procurement.

“Agentic AI can match customer needs with products, automating workflows and streamlining the procurement process.”

It can also enhance service desk operations by triaging tickets and initiating correct workflows, reducing human intervention and improving response times for low-level tasks.

According to Byrne, some of these agents can also be tasked with things like procurement.

“I have seen, for example, the need to make sure product requirements are matched correctly with what we’re selling,” he said. “With distributors for any type of vendor, they deal with multiple different SKUs (stock keeping units), all of which are similar in many ways.

“By using some sort of agentic AI that has intelligence built in, it would be able to more rapidly match the customer need with the correct product SKU.”

It could also automate processes more efficiently in areas like finance, such as issuing invoices, tying them to time, reconciling what’s going through the channel and managing accounts receivable, explained Byrne.

“All that grunt work done in finance could be automated using agentic AI,” he said. “Anything that deals with a large amount of documentation, for example, is ideal for agentic AI because it can ingest, consume, analyse and understand all that documentation.

However, it’s important to remember that the tool is not a replacement for employees and needs to fit into the company’s overall strategy.

“The goal is to make humans more efficient and productive,” he explained.  “We’re not talking about replacing humans, we’re talking about improving workflows that are currently inefficient.

“[While] there will be disruption, the main goal is to do more with the people you have, not necessarily reduce the workforce.”

When these systems are first implemented there also needs to be human supervision until trust in the system has been built.

“These are not systems that we can just drop in and expect to be fully operational,” he said. “They need to be guided in many cases. We need to ensure there are proper guardrails in place when these systems are used for revenue-generating processes.”