Executive Summary:
Copilot Notebooks in Microsoft 365 provide an enterprise-grade workspace for non-profit teams, grant-makers, and charitable trusts to draft, refine, and test AI prompts alongside static source documents without compromising data security. Unlike open-ended chat interfaces, a Copilot Notebook combines multi-modal context, structured rules, and reference files to analyse complex narrative submissions, produce eligibility summaries, and extract criterion-matched evidence . Operating within your private client tenant under UK GDPR standards, Copilot Notebooks ensure that organisational data remains protected and is never used to train public commercial models. By introducing controlled prompt iteration, grant managers can standardise evaluation rubrics, flag missing documentation, and generate consistent reviewer briefings. Crucially, Copilot Notebooks function strictly as decision-support engines: AI performs initial criteria matching and evidence extraction, while authorised human reviewers retain 100% of final funding decisions. This structured approach allows UK non-profits to eliminate administrative bottlenecks while maintaining auditability and governance oversight.
Microsoft Copilot Notebooks are persistent, AI-grounded project workspaces designed to consolidate your documents, chats, and Copilot pages into a single intelligent workspace. Unlike standard chat interfaces where context resets between sessions, a Copilot Notebook grounds every AI response strictly in the reference files and custom instructions you specify.
Whether you are synthesising multi-document research, coordinating strategic campaigns, or managing internal governance, Copilot Notebooks allow UK organisations to turn static files into dynamic, interactive assets.
Purpose of this guidance: A practical reference and workflow for colleagues using Microsoft Copilot to plan, build, test, and govern AI-enabled automation solutions. This Copilot Notebooks guide is designed to support you through each step of the process.
Version: 1.0 | September 2026
Core Operating Principle: One defined project or business problem should normally have one Copilot Notebook. The Notebook provides controlled AI context; SharePoint holds official files; Excel governs and evidences the work; focused Notebook chats provide coaching; and Copilot Studio or Power Platform contains the actual solution.
How to Use This Guidance
This document is designed for colleagues who are new to Copilot Notebooks and for project leads supporting AI-enabled automation work. It provides a plain-English introduction, a recommended operating model, a repeatable workflow, and copy-ready prompts.
| Section | Use It For |
|---|---|
| 1. Quick introduction | Understand what a Copilot Notebook is and is not. |
| 2. Recommended operating model | See how Notebook, SharePoint, Excel, chats, and build tools fit together. |
| 3. When to create a Notebook | Decide whether a request is a project or a one-off task. |
| 4. Standard project workflow | Follow the lifecycle from discovery to handover. |
| 5. Chat management | Avoid long, confusing conversations. |
| 6. Collaboration and sharing | Work safely with internal colleagues. |
| 7. Governance | Apply permissions, evidence, and human-review controls. |
| 8. Templates and prompts | Start projects and sessions consistently. |
1. Copilot Notebooks: A Basic Introduction
A Copilot Notebook is an AI-powered project workspace in Microsoft Copilot. You choose the references Copilot should use, such as Word files, Excel workbooks, PowerPoint presentations, Copilot Pages, meeting material, and supported links. When you ask questions inside the Notebook, Copilot uses the selected project context to produce more focused responses.
What a Notebook is Useful For
- Centralising selected project references for AI-assisted work.
- Keeping separate projects and business problems distinct.
- Asking questions grounded in approved project material.
- Generating project summaries, drafts, test scenarios, and next-step recommendations.
- Maintaining continuity across several focused conversations.
- Sharing a common project context with internal colleagues, while each person retains private Copilot conversations.
What a Notebook Does Not Replace
- The organisation-owned SharePoint project folder.
- The Excel project log, decision log, risk log, or testing record.
- Formal approvals, professional judgement, or human review.
- Copilot Studio, Power Apps, Power Automate, Dataverse, or other build environments.
- A managed deployment, support, and ownership model.
How to Access and Create a Notebook
- Sign in to the Microsoft Copilot app with your work or school account.
- In the left navigation, select Notebooks (if not visible, use the app launcher and look for Notebooks).
- Select All notebooks, then New notebook.
- Give the Notebook a clear project name.
- Add initial project references, then select Create.
- Ask your first project question from inside the Notebook.
How Microsoft Copilot Notebooks Work
Standard AI chat interactions rely on temporary conversation threads that lose context over time. Copilot Notebooks overcome this limitation by creating a dedicated workspace within Microsoft 365. You define the exact references Copilot should read, ensuring external web noise or out-of-scope data does not affect your outputs.
Key Capabilities:
Scoped Context Grounding: Copilot only draws answers from the reference files you explicitly attach—including Word documents, PDFs, PowerPoint decks, Excel sheets, and OneNote pages.
Custom Copilot Instructions: Set persistent behavioural rules, tone guidelines, or specific formatting criteria that Copilot applies automatically across all prompts in that notebook.
Multimodal Collaboration: Convert chat responses directly into shareable Copilot Pages, interactive mind maps, or audio summaries for on-the-go review.
How to Create and Configure a Copilot Notebook
Access the Dashboard: Open the Microsoft Copilot app (
m365.cloud.microsoft) and select Notebooks from the left navigation pane.
Create a Workspace: Click New Notebook and enter a descriptive title (e.g., Q4 Strategic Project Review).
Attach Reference Materials: Click Add Content to attach reference files from OneDrive, SharePoint sites, or direct uploads.
Set Custom Instructions: Open the Instructions tab to specify operational parameters (e.g., “Summarise all answers in British English using bullet points suitable for executive reporting”).
Extract Insights: Query your workspace to draft project briefs, highlight potential risks, or generate structured executive summaries.
Availability note: The Notebooks entry point and available source types can vary by licence, organisational settings, and Microsoft rollout. If Notebooks is not visible, check with the Microsoft 365 administrator.
2. The Recommended Operating Model
| Component | Primary Role | What Should Live There |
|---|---|---|
| SharePoint Project Folder | Organisation-owned project home | Briefs, requirements, evidence, approved prompts, designs, testing, deployment, and handover files. |
| Excel Project-Control Workbook | Formal structured record | Tasks, time, decisions, risks, issues, outputs, versions, tests, governance checks, and next actions. |
| Copilot Notebook | AI context layer | Selected references and project-specific Copilot instructions. |
| Focused Notebook Chats | Coaching and problem-solving | Discovery, architecture, build, troubleshooting, testing, and deployment conversations. |
| Copilot Studio / Power Platform | Solution build environment | Agents, flows, apps, connections, data, and deployment configuration. |
| Word / Copilot Pages | Durable narrative outputs | Project briefs, approved summaries, operating guidance, rebuild guides, and handover documents. |
3. When to Create a Copilot Notebook
Create a Notebook when the work:
- Has a defined business problem or outcome.
- Involves a colleague, sponsor, or stakeholder.
- Will take more than one working session.
- Uses several source documents or evidence items.
- May result in an agent, app, automation, workflow, or reusable tool.
- Requires testing, decisions, permissions, or approval.
- Could later be shared or deployed across the organisation.
- Needs a reliable handover and evidence trail.
Do NOT create a Notebook merely for:
- A quick general question.
- A one-off email or short document.
- A minor formula fix.
- Early informal brainstorming with no agreed project.
- A short experiment that will not be retained.
Boundary Rule: Create Notebooks around business outcomes and project boundaries, not automatically around every technical component. Several connected agents forming one solution can share one Notebook. Separate projects with different stakeholders, permissions, data, or outcomes should normally have separate Notebooks.
4. Standard Workflow for an AI-Enabled Project
- Triage the Request: Clarify the problem, user group, current process, intended outcome, risks, and whether AI or automation is appropriate.
- Create the Project Home: Create the SharePoint folder and a fresh copy of the standard Excel project-control workbook.
- Create the Copilot Notebook: Name it after the business project, not merely the technology. Add the project brief, Excel log, and other approved starting references. See here for the complete AI-enabled project setup guide.
- Set Notebook Instructions: Tell Copilot how to coach, how to distinguish confirmed facts from recommendations, and when to flag governance or logging needs.
- Run Discovery Before Building: Define scope, success criteria, users, data, permissions, human-review points, and non-goals.
- Select the Technical Approach: Decide whether the need is best met by ordinary Copilot, an agent, Power Automate, Power Apps, Copilot Studio, or a combination.
- Build in Focused Sessions: Use separate Notebook chats for architecture, build, actions, testing, and deployment. Work one controlled step at a time.
- Close Every Session: Summarise confirmed work, update Excel, link evidence, and record the exact restart context and next action.
- Test and Review: Use synthetic or approved data, compare expected and actual results, record defects, and retest after changes.
- Gate Organisational Release: Confirm owner, permissions, licensing, environment, support, training, communications, monitoring, and human accountability.
- Handover and Maintain: Store the current design, instructions, solution exports, dependencies, evidence, and support information in SharePoint.
5. Managing Chats Without Creating Long Threads
A Notebook gives the project a common context, but it does not mean every activity should be kept in one conversation. Start a new focused Notebook chat when the workstream changes.
| Suggested Chat | Purpose |
|---|---|
| 01 Discovery and scope | Problem, users, current process, boundaries, and success criteria. |
| 02 Architecture | Solution components, data, integrations, permissions, and environments. |
| 03 Agent or automation build | Step-by-step creation and configuration. |
| 04 Knowledge and instructions | Agent instructions, sources, exclusions, and versioning. |
| 05 Actions and flows | Power Automate, connectors, inputs, outputs, and error handling. |
| 06 Testing | Test cases, expected results, defects, and retesting. |
| 07 Connected-agent integration | Routing, handoffs, shared inputs, and loop prevention. |
| 08 Deployment and handover | Release checks, support model, adoption, and documentation. |
Start a new chat when:
- You move to a different agent or major component.
- You move from building to testing.
- You begin connecting agents or automations.
- An unrelated technical problem takes over the conversation.
- Copilot confuses old and current configurations.
- A major version is released.
- You repeatedly need to say “ignore the earlier approach”.
6. Collaboration and Sharing
Copilot Notebooks can be shared with internal colleagues. The shared Notebook provides a common set of project references, while each person’s Copilot conversations remain private.
| Shared | Private to Each Person |
|---|---|
| Notebook structure and available references | Individual prompts and Copilot conversations |
| Shared project files (subject to permissions) | Personal exploration and coaching exchanges |
| Project-specific Notebook instructions | Each person’s own chat history |
Before Sharing Checklist:
- Review every reference for appropriateness and relevance.
- Check that you have permission to share each linked file.
- Remove sensitive, superseded, or exploratory content.
- Confirm that the approved version is clearly identifiable.
- Remember that invited Notebook members currently receive editing access.
- Invite named internal colleagues rather than relying on group membership.
- Do not use a Copilot Notebook as the only enduring record of an organisation-wide solution.
Ownership Caution: Copilot Notebooks are user-owned. For projects that may become organisation-wide services, keep official files, evidence, approvals, and handover records in organisation-managed SharePoint locations.
7. Governance and Responsible Use
AI-assisted project work should be designed around accountable human control. The person or service owner remains responsible for the purpose, inputs, permissions, testing, decisions, and use of outputs.
| Control Area | Minimum Check |
|---|---|
| Purpose | The business problem and intended benefit are documented. |
| Data | Only necessary, approved, and appropriately classified data is used. |
| Permissions | Users, agents, connections, and sources have the minimum required access. |
| Human Review | The points requiring professional or managerial approval are explicit. |
| Prompt & Instruction Control | The current approved version is identifiable and linked to testing. |
| Testing | Expected and actual results, failures, corrections, and retests are recorded. |
| Transparency | Users understand where AI is used and what remains their responsibility. |
| Deployment | Development, test, and production changes follow an agreed release process. |
| Continuity | Another authorised person could restart, support, or rebuild the solution. |
| Monitoring | Post-release feedback, incidents, changes, and periodic reviews have owners. |
Safeguarding Notice: For education and SEND-related work, continue to apply the organisation’s safeguarding, data protection, acceptable-use, and professional-accountability requirements. Avoid placing safeguarding records, medical information, social-care details, or confidential family circumstances into project references unless an explicitly approved process governs that use.
8. Copy-Ready Templates and Prompts
A. Notebook Naming Convention
AI Project | Department or Service | Short Solution Name
Example: AI Project | Finance | Invoice Processing
B. Suggested Initial References
- Project brief or discovery note
- Excel project-control workbook
- Current process description or process map
- Relevant policies and operating guidance
- Stakeholder requirements and feedback
- Data and permissions assessment
- Approved architecture or solution design
- Current test plan and evidence links
1. Confirmed requirements
2. Approved decisions
3. Suggestions requiring approval
4. Unverified informationCoach technical work one small step at a time. Give one actionable instruction, then wait for the user to report what they see. Do not assume that a step has worked. Identify decisions, risks, issues, outputs, tests and next actions that should be recorded in the Excel project log. Do not silently change an approved architecture, prompt, instruction, knowledge source, permission or governance boundary. Flag when a change affects licensing, data protection, security, another connected component, testing or deployment. AI should support, not replace, accountable human decision-making.
1. The confirmed current position
2. The component and version being worked on
3. The exact recorded next action
4. Any blocker or dependency relevant to that actionThen coach me through that action one small step at a time. Give only one instruction and wait for my result.
1. Work completed
2. Key outcome
3. Decisions made
4. Risks or issues identified
5. Outputs created
6. Testing completed
7. Evidence to link
8. Next action
9. Restart contextDo not add anything that was not confirmed during this session. Use concise, copy-and-paste-ready wording.
1. Sensitive or inappropriate material
2. Superseded versions
3. Files with unclear ownership or permissions
4. Missing approvals
5. Unresolved risks
6. References that should remain private
7. The current approved versions that should be retainedDo not change permissions or remove content. Produce a review checklist for a human owner.
9. Quick-Start Checklist
- ☐ The request is substantial enough to be treated as a project.
- ☐ A clear SharePoint project home exists.
- ☐ A fresh Excel project-control workbook has been created.
- ☐ The Copilot Notebook has a clear project-based name.
- ☐ Only relevant and approved initial references have been added.
- ☐ Project-specific Notebook instructions have been set.
- ☐ Discovery is complete before technical building begins.
- ☐ Focused chats are used for different workstreams.
- ☐ Each session closes with an Excel and evidence update.
- ☐ Testing uses approved or synthetic data and includes retesting.
- ☐ Notebook sharing and linked-file permissions have been reviewed.
- ☐ The solution has an organisation-owned record, named owner, and handover plan.
For every qualifying AI-enabled automation project: create one organisation-owned SharePoint project home, one Excel project-control workbook, one Copilot Notebook, and several focused Notebook chats. Group connected components when they serve one business outcome; separate projects when their outcomes, stakeholders, data, permissions, or ownership differ. If you need help contact us to book a book a M365 Copilot team workshop.
Frequently Asked Questions About Copilot Notebooks
What are Copilot Notebooks used for?
Copilot Notebooks are designed for complex, ongoing tasks requiring deep contextual grounding—such as project onboarding, policy alignment, grant assessment triage, and multi-document synthesis.
What are Copilot Notebooks in Microsoft 365?
Copilot Notebooks provide a side-by-side workspace within Microsoft 365 where users can combine text prompts, static guidance documents, and structured reference files to test AI analysis in a controlled, private environment.
What file types are supported in Copilot Notebooks?
Copilot Notebooks support Word (.docx), PowerPoint (.pptx), Excel (.xlsx), PDF documents, OneNote pages, Loop components, and native Copilot Pages.
Are Copilot Notebooks secure for organisational data?
Yes. Copilot Notebooks operate within your Microsoft 365 security and compliance boundary. References attached to a notebook respect existing tenant permissions and are not used to train public AI models.
Is data entered into Copilot Notebooks secure under UK GDPR?
Yes. Copilot Notebooks operate entirely within your organization’s private Microsoft 365 tenant boundary. Data is protected by enterprise access controls and is never used to train public AI models.
Ready to implement Copilot Notebooks across your team?
We help UK non-profits, grant makers, and enterprise teams set up tailored Copilot workspaces, custom instructions, and robust data governance. Contact our team today to discuss your AI requirements.