Julie Bilodeau:
Welcome to BDO Digital Digest, where, as curious leaders, we're here to explore how evolving technology propels businesses forward and reshapes our work. I'm Julie Bilodeau and I'm here with Hamed Faghfoury. We are leaders in BDO Canada's technology practice. Thank you for joining us today. We're going to dive into today's topic, the Frontier Firm. We're digging in on Microsoft's work trend annual report for 2025 that was posted in April. They call this year the Year the Frontier Firm is born. And it claims that this is the year that the moment when companies are moving beyond experimenting with AI and they're actually going to begin rebuilding around it. So understanding the power of pairing irreplaceable human insight with AI and agents to unlock outsized value and it claims the transformation is already underway. Hamed, I love this topic, this is going to be so fun today.
Hamed Faghfoury:
This is right in my wheelhouse. I think everyone's hearing about AI agents and the evolution of AI with the latest models. This is really going to put it into a practical sense what it means for organizations. I'm super excited about this session.
Julie Bilodeau:
Yes. And worldwide at that. This report is just so huge. So Jason Cigan is our guest today. We're going to invite him on stage to help us expand more on this notion of the Frontier Firm. He is one of our partners in our modern workplace practice and throughout his career, Jason has been dedicated to offering cutting-edge services with an emphasis on modern digital workplaces. He pioneered low code and no code solutions with a specialization on implementing Microsoft Cloud and more recently, generative AI technology. So who better to have with us today to walk us through this report and get the most we can out of it. So welcome, Jason.
Jason Cigan:
Thanks, Julie. Thanks, Hamed. Really excited to be here today. Thanks for having me.
Hamed Faghfoury:
Good to have you.
Julie Bilodeau:
Oh, we love this topic. This is going to be so cool. It's all about today and the future. So, Jason, could you tell us more about what is this report about? What can we get out of it? What are the highlights? What is this "Frontier Firm?"
Jason Cigan:
Yeah, for sure. So this is an annual report that Microsoft releases. It's the work trend index report and it summarizes data that Microsoft has collected from over 31,000 surveys across over 30 different countries. They also take into account a lot of, trillions of productivity signals that they collect from their platforms that have been completely anonymized and it spans several industries. And so this year, it's really all about this concept of the Frontier Firm. And so what does that mean? It's kind of a newer term and it really encompasses this concept of firms that are really powered by hybrid teams of humans and agents that enables these organizations to be able to scale rapidly and operate with a lot more agility and generate value faster. But this isn't a journey that you can go on and accomplish in 6 to 12 months. It is a multi-year journey. It can take anywhere from two to five years.
And so what we see some traits from Frontier Firms, are organizations that have deployed AI organization-wide, across all of their employees. They have an advanced level of AI maturity. They are using agents throughout the organization and they plan to project their agent use to increase. And there's just an overall belief within their strategy that AI and agents are key to realizing that ROI. And so there's one really interesting statistic that came out of the survey, which is 71% of Frontier Firm workers say their companies are thriving, and that's in contrast to just 37% of workers globally.
Hamed Faghfoury:
That's interesting, Jason. I think that sort of highlights a couple of things in terms of adoption. We've seen adoption accelerating. It was mentioned in the report that 24% of leaders are saying that their companies have deployed AI solutions organization-wide, which is a really interesting stat and climbing. When we're talking about envisioning AI agents being integrated into organizational structure, not just AI assistants, but now AI agents coming in and being part of the organizational structure, part of any traditional team, what do you see the impact that this will leave in terms of traditional roles? How do you see this traditional team evolve now that you have this idea of AI agents woven in as part of these Frontier Firms?
Jason Cigan:
Yeah, that's a great question and I'll introduce another concept from the report, which is this concept of buying intelligence on tap. And so what does that mean? So for decades, intelligence was this limited asset that was bound by human time, energy and cost. But with the rise of AI and agents and these agents that have the ability to reason and plan and act as digital labor, we have this new ability to buy that intelligence on tap. 82% of leaders that were surveyed in this report plan to use digital labor within the next 12 to 18 months. And I think, yeah, it's a really interesting stat and it's significant. And I think this ties back to an earlier podcast that you did, which highly recommend people check out if they haven't already, The Productivity Paradox. It's that 53% of leaders say that productivity must increase and being able to buy intelligence on tap is going to be a primary driver of that.
And so that second part of that question is how do we see this impacting work charts? Well, up until now, companies have been built around more domain expertise, functions like finance, HR, marketing, engineering. We know the org structure. But with this intelligence and expertise on demand, we may see a shift of the org chart being either augmented or fully replaced by more of a work chart. So a more of an outcome-driven model where teams focus around goals, not necessarily functions that are powered by agents that can expand the employee scope to be able to enable faster, more impactful work. And another statistic here says that nearly half of leaders around, just under half, 46%, say they plan to use agents to fully automate workflows and processes. But not all of these functions are going to evolve at the same pace. And then, the key to that is finding the right human and agent ratio. We can't have too few agents, but we also can't have too many. So the key to this is going to be finding that optimal balance.
Julie Bilodeau:
Yeah, you remind me, Jason, of what I was reading in the report, which I really resonated with, which is that businesses are demanding more than what humans can produce. I can't tell you how many e-mails I get in a day and how many interruptions, I'm sure we all get in a day. And in the end, that to me was really fueling the use of and the popularity, let's say, even the demand for AI, gen AI specially to begin with. I know my kids, they ask me, "Mom, why are you so into this AI? What's so big about this?" Because I was on ChatGPT for over two years now, and what I tell them is, "Guys, I'm just tired. I will take anything I can get to help me, any tool I can get to help me get through what I need to do day-to-day, and gen AI has been such a stellar player in my playbook of how to get through my day and to get things done." Smart, right?
Sure, we all want to work hard, but we all also want to work smart. So all that saying, for those of you with burnout out there and really struggling, so how are we seeing these AI agents complementing humans in order to produce this productivity that we're looking at?
Jason Cigan:
Yeah, absolutely. And agents is that next wave of generative AI that's going to join the workforce. We're going to have agents working alongside employees and our people as part of the workforce. But again, it's going to be really important to find the right balance of agents within our teams.
Julie Bilodeau:
The ratio?
Jason Cigan:
Yeah. Too few agents per person, we're under-utilizing resources and leaving efficiencies on the table. Contrast that with too many agents and then we're back to the same problem, Julie, that you mentioned. We're overwhelming our people. That can lead to even further burnout. And so it's really important that we find that right balance so that humans get those efficiencies and remove the drudgery of their work, automate those processes, but allow for time for humans to remain and use their judgment, use their decision-making without further impacting burnout. And so again, finding that optimal balance to enhance productivity, really innovate, but allow humans to provide that guidance and that oversight. And then, this is where also in the report we hear this concept of an agent boss.
Did you guys read that part of the report, the agent boss?
Hamed Faghfoury:
I did, yeah.
Julie Bilodeau:
Yeah. Tell more. Please, do tell more.
Jason Cigan:
Yeah. Again, it was another really interesting concept of this is where an agent boss, this is a person, one of your employees, and it's this new role that's going to arise that this is someone within your organization that can build agents, they can delegate tasks to agents, and they can manage agents to amplify their impact within their organization. And so what we see these days is we see there's a lot of agents that come straight out of the box with a lot of these platforms that you can start to use right away. But there's also agents that with a few clicks you can configure to do a certain task or fully custom agents to integrate with your line of business systems. And so the key takeaway here of an agent boss is that we really need to be thinking about how we can leverage agents within our teams to automate these tasks and handle these routine repetitive processes, but also train our people to become agent bosses.
Hamed Faghfoury:
Love it, love it. I think it's a great segue to our own co-host who we have as an AI agent, Jenny. So if you don't know, Jason, we have a portion of our show where we dedicate to Jenny, our AI agent co-host, who asks a question, a relevant question based on the topic. Jenny has read the report from Microsoft, she has crafted this question, and I'm going to ask it on her behalf. So if you don't like, it's Jenny who asked the question. But Jenny asks what practical strategies should organizations adopt to ensure successful AI integration and ROI? It's an excellent question from Jenny. What's your thoughts on that?
Jason Cigan:
That is a great question, and I think it's a question that we often get from our customers and something that we also reflect internally at BDO. So I love the word sort of practical there. That's a key pillar of our strategy at BDO. And so it's really key to have a holistic approach to AI that enables that practicality and a business-first enablement of AI that's aligned to the organizational objectives. So like most transformations, it's key to have a strategy in place and with AI, it's going to be really important to have a strategy that's in place on how the integration of AI is aligned to the strategic objectives of your organization.
So some things to ensure you have in place is a practical strategy for that vision of how to use AI. But then a prioritization, right? Are there potential use cases within the organization that you can prioritize and build proof-of-concepts, get some quick wins, and show the value of AI, and then build on that? Choosing the right AI technologies, there's so many different AI technologies out there and aligning those use cases with the most appropriate AI technology, it is key. What data will be used? Is that data secure? And then, having an organizational change management model to ensure adoption.
And as you're building, as you're implementing these AI use cases and POCs, it's really important to continue to assess the accuracy of the results and measure that value. And then finally, just sort of wrapping it all up with a continuous improvement and integration of AI, continue to improve the data quality. Take those lessons learned into the next use case, into the next proof-of-concept, get those quick wins and really measure the ROI that you're getting. So yeah, I would say that that's probably a few steps to ensure that we're getting that ROI from AI.
Julie Bilodeau:
It's definitely a journey, but I think one that every business needs to start, to be honest, 'cause the more I'm listening to you guys and this report and just what's happening out there, for those organizations, what was it 24% that are already implementing organization-wide AI, man, are they going to be light years ahead from other organizations that aren't or aren't even open to it. So it's going to be quite a way forward.
Guys, I think we got to wrap it up for this episode. That was amazing. Thank you both for your insights into this and thank you, Microsoft, for your annual report, the Frontier Firm, guys, 2025. I would love to circle back at the end of the year on this and see how did the year go for the Frontier Firm. So guys, we may have a recap or refresher episode that might be kind of fun to do. But in the meantime, thank you all of you for listening in this episode, tuning into our BDO Digital Digest. Join us next time as we continue to explore the future of technology and how it impacts us day-to-day. Until then, stay curious, stay innovative, and bend that arc of possibility in your world.
Thanks again so much.