Microsoft's 2025 Work Trend Index Annual Report presents a vision of a new organizational model emerging in the age of AI. The report, based on survey data from 31,000 workers across 31 countries, LinkedIn labor market trends, and Microsoft 365 productivity signals, identifies the rise of the "Frontier Firm" - a new kind of organization built around intelligence on tap, human-agent teams, and a new role for everyone: agent boss.

The report argues that we are entering a new reality where AI can reason and solve problems in remarkable ways, rewriting the rules of business and transforming knowledge work. This transformation is compared to the Industrial Revolution and the internet era, with the expectation that it will take decades to reach its full promise and involve broad technological, societal, and economic change.

The Frontier Firm

The Frontier Firm is defined as a company powered by intelligence on tap, human-agent teams, and a new role for everyone: agent boss. These organizations are structured around on-demand intelligence and powered by "hybrid" teams of humans and agents, enabling them to scale rapidly, operate with agility, and generate value faster.

Microsoft predicts that within the next 2-5 years, every organization will be on their journey to becoming a Frontier Firm, with 82% of leaders saying this is a pivotal year to rethink key aspects of strategy and operations.

The Journey to the Frontier Firm

The report outlines three phases in the journey to becoming a Frontier Firm:

1. Human with assistant: Every employee has an AI assistant that helps them work better and faster, removing the drudgery of work.
2. Human-agent teams: Agents join teams as "digital colleagues," taking on specific tasks at human direction. These agents equip employees with new skills that help scale their impact, freeing them to do new and more valuable work.
3. Human-led, agent-operated: Humans set direction for agents that run entire business processes and workflows, checking in as needed.

The report notes that this journey is not strictly linear—organizations will likely be in all three phases simultaneously across different functions.

The report identifies three major themes that characterize the emergence of Frontier Firms:

• You can buy intelligence on tap
• Human-agent teams will upend the org chart
• Every employee becomes an agent boss

Explore each theme in detail through the navigation menu to understand how these concepts are reshaping the future of work and organizations.