‘AI is no longer optional’ at Microsoft – is this the right way to drive workplace AI adoption?

$245 billion-revenue tech giant Microsoft has made headlines for its move to mandate AI use at work.

In an internal memo, Julia Liuson, President of the Development Division at Microsoft, wrote: “AI is now a fundamental part of how we work.

“Just like collaboration, data-diving thinking, and effective communication, using AI is no longer optional – it’s core to every role and every level”.

That’s according to reporting by Business Insider, whose journalists have seen the memo.

The memo went on to tell managers that employee AI use must now form part of “holistic reflections on an individual’s performance and impact”.

Microsoft are considering implementing an AI metric into performance review processes in the next fiscal year.

UNLEASH reached out to Microsoft to get additional comment on this AI move.

The tech giant is not alone in an AI mandate – Shopify, Duolingo and Thomson Reuters have taken similar steps.

UNLEASH was keen to find out whether mandates are the right way to drive up adoption of AI in workplaces.

Are they going to help organizations truly reap the rewards in productivity, job satisfaction and wellbeing?

How can organizations strike the balance between carrot and stick? What are HR’s roles and responsibilities around enforcing and encouraging AI adoption at work?

We spoke to HR leaders, vendors, analysts and lawyers to help answer these questions.

Microsoft AI mandates: Necessary or counterproductive?

For Siobhan Savage, CEO of Reejig, she is in agreement with Microsoft’s mandate on AI – “using AI at work shouldn’t be optional”, Microsoft is simply “setting the standard every other company will need to follow”.

“You don’t get transformation if AI is optional. You get fragmentation,” adds Savage.

“The question isn’t whether AI should be mandated”, instead, organizations need to ask themselves “what are we waiting for?”

Tina Gupta, SVP, Talent Management at New York Life Insurance Company, sees this as “just a sign of things to come for all companies”.

Kathi Enderes, SVP of Research, The Josh Bersin Company, notes that “Microsoft’s approach represents a fundamental shift: AI transformation is no longer experimental; it’s becoming table stakes for competitive survival”.

“Leading organizations recognize that success in AI transformation is not about the best technologies. It’s about people and culture,” continues Enderes.

Rebecca Carr, SmartRecruiters’ CEO agrees.

“We are at a moment where leaders must top waiting for universal buy-in and start setting clear expectations for responsible AI use.”

However, Carr is clear that “telling people to use AI is not enough – you need to show them where it fits, how it helps, and why they can trust it”.

“The goal should not be AI usage for its own sake”, particularly with AI factoring into performance decisions.

“I’ve seen too many teams reward the loudest adopters of new tools, while missing the quiet contributors who actually drive change, even if their adoption is slower,” adds David Murray, CEO and Co-Founder of Confirm.

“Performance reviews have a history of rewarding visibility over value. If we do not learn from those patterns, AI will just become another box to check.

“Measuring usage before building confidence is how you get performance theater, not performance transformation.”

Kate Kurdziej, founder of Olivier Consultancy, also talked about this idea of tick boxes and theater.

“Microsoft’s approach risks creating ‘AI theater’ – people using tools just to show compliance rather than genuine productivity gains which will ironically decrease productivity,” she tells UNLEASH.

How to balance carrot and stick with AI

Workplace mandates are often seen as a ‘stick’ approach to HR policy. Rather than going down this route, is it better for organizations to embrace more of a ‘carrot’ to encourage (not enforce) AI usage?

UNLEASH put this questions to our HR experts. Is there a risk of too much stick, and not enough carrot?

For Dan Buckley, CEO of Cognexo, “mandates can create a sense of urgency, but urgency without capability is risky”.

“You can’t drive transformation through pressure alone. It’s like unleashing a rocket without providing the flight manual – it’s bound to create anxiety, rather than empowerment,” he adds.

“True impact comes from embedding AI into workflows in ways that drive value and that require thoughtful rollout, not just top-down mandates.”

Buckley continues: “Incentivizing curiosity, experimentation and skill-building around AI is far more productive than penalizing those who haven’t caught up” – by having a carrot approach, “employees feel safe learning, failing and iterating” with AI.

Jess Von Bank, Global Leader, Digital Transformation & Technology Advisory at Mercer, shares that “we keep confusing button-clicking with value creation”.

You can’t “force use for usage’s sake”. “Make AI so helpful, so intuitive, that opting out would feel like going back to dial-up,” states Von Bank.

Kurdziej takes the same approach – “The companies succeeding with AI aren’t mandating it – they’re making it so obviously helpful that people choose to adopt it. In my experience, those ones will produce the best results.”

The Josh Bersin Company’s Enderes comments that organizations need to “think of AI transformation like teaching a child to ride a bike”.

“First, you run alongside them, offering encouragement, holding the seat, and celebrating every wobble forward. But there comes a moment when you must let go and expect them to pedal on their own.

“Microsoft has reached that ‘letting go’ moment”.

For Enderes, the tech giant is now switching from carrot-only to “stick and carrot”.

“I call this the “Goldilocks Principle” of transformation: Too early, and you overwhelm people; too late, and you miss out on competitive advantage.

“As one executive recently told me: ‘We’ve moved from asking ‘Can we use AI?’ to ‘How quickly can we scale AI?’ The mandate isn’t punishment; it’s permission to accelerate’.”

As things stand, Enderes is clear that “most organizations are still in the ‘carrot phase’. and aren’t ready for mandates because they haven’t built the foundation yet.

Jumping straight to enforcement without the right enablement is like expecting your child to ride the bike without having learned how to do – it can seriously damage the progress and set you way back.”

Talking about her experience at New York Life Insurance Company, Gupta shares that the organization has “launched an AI goal for all employees which although not weighted will be a factor considering during performance discussion and final performance rating”.

“The goal was a deliberate signal that we have a clear expectation for all employees to use AI” – but this is balanced with an recognition to reward those learning into AI.

Ultimately, as Jemma Fairclough-Haynes, CEO at Orchard Employment Law, tells UNLEASH: “People generally respond to rewards [rather] than punishment”.

For Murray, CEO of Confirm: “You cannot punish your way into innovation” – “Start with motivation. Reward experimentation. Celebrate the early wins. Make space for people to learn without fear of falling behind”.

HR’s roles and responsibilities in AI world of work

Whichever approach an employer takes to AI – stick, carrot, or a mixture – there are significant roles and responsibilities that the HR team need to take on.

HR’s role becomes even more essential if AI is going to play into performance reviews, and promotion decisions.

Dr Raoul-Gabriel Urma, Founder & Group CEO at Cambridge Spark, is clear: “Making AI usage compulsory, without supporting or training your employees, is a fast track to failure.

“Adoption won’t stick unless staff are ready, willing, and able to use AI tools in their work.”

Dr Urma shares that employees “need thorough on-the-job training that teaches both hard and soft AI skills, from data literacy to critical thinking, which can then be applied to their work.

“And there must also be clear communication as to how leaders expect employees to use AI in their work, rather than just demanding that it’s used.”

SmartRecruiters’ Carr sees HR as the “glue that holds this shift together”.

“They need to think like strategists and builders. They will need to clarify the policies, ensure ethical guardrails, communicate clearly, and train teams not just on tools, but on mindset.

“HR has a key role to play in creating trust and momentum around AI at work,” continues Carr.

Fairclough-Haynes from Orchard Employment Law shares that HR also needs to be aware of potential discrimination concerns around AI use at work.

Mandates in particular “could alienate certain groups of people and could even be considered discriminatory”. There’s a spectrum of examples here – and Fairclough-Haynes shared some instances with UNLEASH.

An obvious example are “more senior members of society”. “They are of an age that did not grow up with internet and may find it more difficult to get to grips with AI. Removing bonuses or penalizing staff who do not use AI could be considered age discrimination”.

A less obvious instance, which HR still needs to be aware of, is “staff who have a view about the use of AI and its impact on the planet could be considered protected in the same way that ethical vegans are protected for have a belief.

“Creating consequences for employees who do not wish to go against their morals could result in timely and costly employment litigation.”

This discrimination point was picked up by Ella Bond, Senior Employment Solicitor at Harper James.

She shares that with AI factoring into performance reviews, in particular, HR needs to be very careful of the discrimination risks.

“Performance management frameworks must be fair and inclusive. Not all employees will have had the same exposure to AI, nor will they learn at the same pace.”

Legally speaking, any mandates or policies around AI “would need to be applied consistently, transparently, and in a non-discriminatory way to avoid potential claims”.

AI policies also need to “respect data privacy, accommodate diverse working styles, and account for reasonable objections, such as environmental or ethical concerns”; the goal for organizations “should be cultural integration, not just top-down enforcement”.

Clearly, there’s a lot for HR to do when it comes to AI adoption at work – and these requirements will change as the AI technology continues to evolve.

However, Quinyx CHRO Toma Pagojute reminds UNLEASH, HR is not in this alone.

It has to be a company-wide effort. This is not something we have all been doing for 100 years. We are learning as we go, so it is important to approach it together.”