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Microsoft 365 Copilot's August Update: What Actually Changed for Your Work Day

By CA Minal Sharma24 August 20266 min read

If you use Word, Excel, Outlook or SharePoint at work, Copilot inside them just changed again. Microsoft pushed a bundle of updates through August 2026, and unlike some months where the changelog is mostly small fixes, this one has three or four things that will actually show up in your day. Here is what is real, what it does, and what is still not worth your time.

You can now pick Claude instead of GPT inside Copilot

The biggest change is choice. Microsoft has been adding Anthropic's Claude models into Copilot alongside OpenAI's GPT-5.6 family. Claude Sonnet 5 landed first inside Copilot in Word, PowerPoint and Cowork, and Claude Opus 5 followed this month. An admin can switch this on for specific users or teams from the admin centre, it is not automatic for everyone yet.

Why this matters to you: different models are better at different things, and until now you had no say in which one drafted your document. If your organisation turns this on, you can choose the model the same way you would choose a colleague for a task. GPT-5.6 tends to be faster for quick drafts. Claude models are built for longer, multi-step work, the kind where Copilot has to hold context across many steps of a task rather than answer one question.

The model behind your AI assistant is no longer fixed. That is a genuine shift. It means the quality of your Copilot output now depends partly on a setting someone in IT has to actually flip on.

If you have not seen a model picker in your Copilot yet, ask your IT admin whether Anthropic models have been enabled for your license tier. Not every Microsoft 365 plan gets this by default.

Notebooks can turn a pile of notes into an actual document

Copilot Notebooks, the feature where you drop in files, links and notes and chat with them, now has an output side. Instead of only answering questions about what you fed it, it can draft a Word document, build an Excel spreadsheet, or put together a PowerPoint deck directly from the material in the notebook. It can also generate a mind map of what is inside.

This is the part I would actually try first. If you already collect meeting notes, client emails and reference PDFs into one notebook before writing a report, you can now ask Copilot to turn that pile into a structured first draft instead of writing the summary yourself and then formatting it separately.

Using everything in this notebook, draft a one-page Word summary for a client update. Structure: what we did this quarter, three key numbers, one risk to flag, next steps. Keep the tone factual, not promotional. Flag anywhere you are unsure of a figure instead of guessing.

That last line in the prompt matters more than the rest of it. Notebooks still work off whatever you fed them, and if a number is missing or ambiguous in your source files, an unguided prompt will often smooth over the gap rather than flag it. Telling it explicitly to flag uncertainty is the difference between a draft you can trust and one you have to re-check line by line anyway.

Excel got a proper design skill, not just formulas

Excel's Copilot can now be called with an @theme-design skill that goes beyond writing formulas. It will apply a coordinated colour palette, style your charts to match, and clean up the layout of a sheet in one pass. For anyone who has spent twenty minutes manually aligning a dashboard before a leadership review, this is a small feature with an outsized time saving.

Where this is genuinely useful

Monthly MIS packs, board decks built from raw Excel exports, and any sheet that gets forwarded outside your team benefit the most. A consistent, professional look on a spreadsheet used to take real effort. Now it is closer to one instruction.

Where it is not

Working sheets that only you and your immediate team see do not need this. Do not spend time prettifying a file that exists purely for internal calculation. Save the polish for anything that leaves your desk.

Outlook now preps you for meetings before you open the invite

Copilot in classic Outlook for Windows can now pull together real-time preparation for an upcoming meeting: a summary of relevant emails, open action items, and linked documents, without you asking for it. You can also chat with it directly to go deeper before you walk in.

This is a smaller change but a genuinely practical one, particularly if your calendar is full of recurring client or internal reviews where the context lives across a dozen scattered threads. It will not replace actually knowing your account or your project. It will save you the ten minutes of scrolling back through email you would otherwise spend right before the call.

SharePoint dashboards that update themselves

Copilot in SharePoint can now generate a live dashboard directly from a list or file, delivered as an interactive HTML report that stays connected to the underlying data and refreshes each time it is opened. If your team tracks anything in a shared SharePoint list, whether that is a project tracker or a simple approvals log, you no longer need someone to manually rebuild a summary view every week.

What to actually do with this

Do not try to adopt all of this in one week. Pick the one feature closest to a task you already repeat. If you write client summaries from scattered notes, try Notebooks. If you format the same MIS pack every month, try the Excel design skill. If your calendar is full of context-heavy recurring meetings, try the Outlook preparation. Test it on real, low-stakes work first, check the output against what you know to be true, and only then let it into anything client facing.

This is also a good moment to be honest with yourself about how well you actually use the AI tools already sitting on your laptop. Most professionals use perhaps a tenth of what Copilot or ChatGPT can already do, and every monthly update widens that gap further unless you deliberately close it. That is a large part of what we work on at AiM, and you can check your own starting point with the AiM AI Fluency Test, eighteen real tasks, twelve minutes, no login required.

New model, new skill, new dashboard: none of it matters if the habit of trying it does not follow. Pick one thing from this list and use it on a real task this week, not a demo task. That single habit is worth more than reading every changelog Microsoft publishes.

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