Building real-world AI automation with Foundry Local and the Microsoft Agent Framework
A hands-on guide to building real-world AI automation with Foundry Local, the Microsoft Agent Framework, and PyBullet. No cloud subscription, no API keys, no internet required. Why Developers Should Care About Offline AI Imagine telling a robot arm to "pick up the cube" and watching it execute the command in a physics simulator, all powered by a language model running on your laptop. No API calls leave your machine. No token costs accumulate. No internet connection is needed. That is what this project delivers, and every piece of it is open source and ready for you to fork, extend, and experiment with. Most AI demos today lean on cloud endpoints. That works for prototypes, but it introduces latency, ongoing costs, and data privacy concerns. For robotics and industrial automation, those trade-offs are unacceptable. You need inference that runs where the hardware is: on the factory floor, in the lab, or on your development machine. Foundry Local gives you an OpenAI-compatible endpoint running entirely on-device. Pair it with a multi-agent orchestration framework and a physics engine, and you have a complete pipeline that translates natural language into validated, safe robot actions. This post walks through how we built it, why the architecture works, and how you can start experimenting with your own offline AI simulators today. Architecture The system uses four specialised agents orchestrated by the Microsoft Agent Framework: Agent What It Does Speed PlannerAgent Sends user command to Foundry Local LLM → JSON action plan 4–45 s SafetyAgent Validates against workspace bounds + schema < 1 ms ExecutorAgent Dispatches actions to PyBullet (IK, gripper) < 2 s NarratorAgent Template summary (LLM opt-in via env var) < 1 ms User (text / voice) │ ▼ ┌──────────────┐ │ Orchestrator │ └──────┬───────┘ │ ┌────┴────┐ ▼ ▼ Planner Narrator │ ▼ Safety │ ▼ Executor │ ▼ PyBullet Setting Up Foundry Local from foundry_local import FoundryLocalManager import openai manager = FoundryLocalManager("qwen2.5-coder-0.5b") client = openai.OpenAI( base_url=manager.endpoint, api_key=manager.api_key, ) resp = client.chat.completions.create( model=manager.get_model_info("qwen2.5-coder-0.5b").id, messages=[{"role": "user", "content": "pick up the cube"}], max_tokens=128, stream=True, ) from foundry_local import FoundryLocalManager import openai manager = FoundryLocalManager("qwen2.5-coder-0.5b") client = openai.OpenAI( base_url=manager.endpoint, api_key=manager.api_key, ) resp = client.chat.completions.create( model=manager.get_model_info("qwen2.5-coder-0.5b").id, messages=[{"role": "user", "content": "pick up the cube"}], max_tokens=128, stream=True, ) The SDK auto-selects the best hardware backend (CUDA GPU → QNN NPU → CPU). No configuration needed. How the LLM Drives the Simulator Understanding the interaction between the language model and the physics simulator is central to the project. The two never communicate directly. Instead, a structured JSON contract forms the bridge between natural language and physical motion. From Words to JSON When a user says “pick up the cube”, the PlannerAgent sends the command to the Foundry Local LLM alongside a compact system prompt. The prompt lists every permitted tool and shows the expected JSON format. The LLM responds with a structured plan: { "type": "plan", "actions": [ {"tool": "describe_scene", "args": {}}, {"tool": "pick", "args": {"object": "cube_1"}} ] } The planner parses this response, validates it against the action schema, and retries once if the JSON is malformed. This constrained output format is what makes small models (0.5B parameters) viable: the response space is narrow enough that even a compact model can produce correct JSON reliably. From JSON to Motion Once the SafetyAgent approves the plan, the ExecutorAgent maps each action to concrete PyBullet calls: move_ee(target_xyz) : The target position in Cartesian coordinates is passed to PyBullet's inverse kinematics solver, which computes the seven joint angles needed to place the end-effector at that position. The robot then interpolates smoothly from its current joint state to the target, stepping the physics simulation at each increment. pick(object) : This triggers a multi-step grasp sequence. The controller looks up the object's position in the scene, moves the end-effector above the object, descends to grasp height, closes the gripper fingers with a configurable force, and lifts. At every step, PyBullet resolves contact forces and friction so that the object behaves realistically. place(target_xyz) : The reverse of a pick. The robot carries the grasped object to the target coordinates and opens the gripper, allowing the physics engine to drop the object naturally. describe_scene() : Rather than moving the robot, this action queries the simulation state and returns the position, orientation, and name of every object on the table, along with the current end-effector pose. The Abstraction Boundary The critical design choice is that the LLM knows nothing about joint angles, inverse kinematics, or physics. It operates purely at the level of high-level tool calls ( pick , move_ee ). The ActionExecutor translates those tool calls into the low-level API that PyBullet provides. This separation means the LLM prompt stays simple, the safety layer can validate plans without understanding kinematics, and the executor can be swapped out without retraining or re-prompting the model. Voice Input Pipeline Voice commands follow three stages: Browser capture: MediaRecorder captures audio, client-side resamples to 16 kHz mono WAV Server transcription: Foundry Local Whisper (ONNX, cached after first load) with automatic 30 s chunking Command execution: transcribed text goes through the same Planner → Safety → Executor pipeline The mic button (🎤) only appears when a Whisper model is cached or loaded. Whisper models are filtered out of the LLM dropdown. Web UI in Action Pick command Describe command Move command Reset command Performance: Model Choice Matters Model Params Inference Pipeline Total qwen2.5-coder-0.5b 0.5 B ~4 s ~5 s phi-4-mini 3.6 B ~35 s ~36 s qwen2.5-coder-7b 7 B ~45 s ~46 s For interactive robot control, qwen2.5-coder-0.5b is the clear winner: valid JSON for a 7-tool schema in under 5 seconds. The Simulator in Action Here is the Panda robot arm performing a pick-and-place sequence in PyBullet. Each frame is rendered by the simulator's built-in camera and streamed to the web UI in real time. Overview Reaching Above the cube Gripper detail Front interaction Side layout Get Running in Five Minutes You do not need a GPU, a cloud account, or any prior robotics experience. The entire stack runs on a standard development machine. # 1. Install Foundry Local winget install Microsoft.FoundryLocal # Windows brew install foundrylocal # macOS # 2. Download models (one-time, cached locally) foundry model run qwen2.5-coder-0.5b # Chat brain (~4 s inference) foundry model run whisper-base # Voice input (194 MB) # 3. Clone and set up the project git clone https://github.com/leestott/robot-simulator-foundrylocal cd robot-simulator-foundrylocal .\setup.ps1 # or ./setup.sh on macOS/Linux # 4. Launch the web UI python -m src.app --web --no-gui # → http://localhost:8080 Once the server starts, open your browser and try these commands in the chat box: "pick up the cube": the robot grasps the blue cube and lifts it "describe the scene": returns every object's name and position "move to 0.3 0.2 0.5": sends the end-effector to specific coordinates "reset": returns the arm to its neutral pose If you have a microphone connected, hold the mic button and speak your command instead of typing. Voice input uses a local Whisper model, so your audio never leaves the machine. Experiment and Build Your Own The project is deliberately simple so that you can modify it quickly. Here are some ideas to get started. Add a new robot action The robot currently understands seven tools. Adding an eighth takes four steps: Define the schema in TOOL_SCHEMAS ( src/brain/action_schema.py ). Write a _do_<tool> handler in src/executor/action_executor.py . Register it in ActionExecutor._dispatch . Add a test in tests/test_executor.py . For example, you could add a rotate_ee tool that spins the end-effector to a given roll/pitch/yaw without changing position. Add a new agent Every agent follows the same pattern: an async run(context) method that reads from and writes to a shared dictionary. Create a new file in src/agents/ , register it in orchestrator.py , and the pipeline will call it in sequence. Ideas for new agents: VisionAgent: analyse a camera frame to detect objects and update the scene state before planning. CostEstimatorAgent: predict how many simulation steps an action plan will take and warn the user if it is expensive. ExplanationAgent: generate a step-by-step natural language walkthrough of the plan before execution, allowing the user to approve or reject it. Swap the LLM python -m src.app --web --model phi-4-mini Or use the model dropdown in the web UI; no restart is needed. Try different models and compare accuracy against inference speed. Smaller models are faster but may produce malformed JSON more often. Larger models are more accurate but slower. The retry logic in the planner compensates for occasional failures, so even a small model works well in practice. Swap the simulator PyBullet is one option, but the architecture does not depend on it. You could replace the simulation layer with: MuJoCo: a high-fidelity physics engine popular in reinforcement learning research. Isaac Sim: NVIDIA's GPU-accelerated robotics simulator with photorealistic rendering. Gazebo: the standard ROS simulator, useful if you plan to move to real hardware through ROS 2. The only requirement is that your replacement implements the same interface as PandaRobot and GraspController . Build something completely different The pattern at the heart of this project (LLM produces structured JSON, safety layer validates, executor dispatches to a domain-specific engine) is not limited to robotics. You could apply the same architecture to: Home automation: "turn off the kitchen lights and set the thermostat to 19 degrees" translated into MQTT or Zigbee commands. Game AI: natural language control of characters in a game engine, with the safety agent preventing invalid moves. CAD automation: voice-driven 3D modelling where the LLM generates geometry commands for OpenSCAD or FreeCAD. Lab instrumentation: controlling scientific equipment (pumps, stages, spectrometers) via natural language, with the safety agent enforcing hardware limits. From Simulator to Real Robot One of the most common questions about projects like this is whether it could control a real robot. The answer is yes, and the architecture is designed to make that transition straightforward. What Stays the Same The entire upper half of the pipeline is hardware-agnostic: The LLM planner generates the same JSON action plans regardless of whether the target is simulated or physical. It has no knowledge of the underlying hardware. The safety agent validates workspace bounds and tool schemas. For a real robot, you would tighten the bounds to match the physical workspace and add checks for obstacle clearance using sensor data. The orchestrator coordinates agents in the same sequence. No changes are needed. The narrator reports what happened. It works with any result data the executor returns. What Changes The only component that must be replaced is the executor layer, specifically the PandaRobot class and the GraspController . In simulation, these call PyBullet's inverse kinematics solver and step the physics engine. On a real robot, they would instead call the hardware driver. For a Franka Emika Panda (the same robot modelled in the simulation), the replacement options include: libfranka: Franka's C++ real-time control library, which accepts joint position or torque commands at 1 kHz. ROS 2 with MoveIt: A robotics middleware stack that provides motion planning, collision avoidance, and hardware abstraction. The move_ee action would become a MoveIt goal, and the framework would handle trajectory planning and execution. Franka ROS 2 driver: Combines libfranka with ROS 2 for a drop-in replacement of the simulation controller. The ActionExecutor._dispatch method maps tool names to handler functions. Replacing _do_move_ee , _do_pick , and _do_place with calls to a real robot driver is the only code change required. Key Considerations for Real Hardware Safety: A simulated robot cannot cause physical harm; a real robot can. The safety agent would need to incorporate real-time collision checking against sensor data (point clouds from depth cameras, for example) rather than relying solely on static workspace bounds. Perception: In simulation, object positions are known exactly. On a real robot, you would need a perception system (cameras with object detection or fiducial markers) to locate objects before grasping. Calibration: The simulated robot's coordinate frame matches the URDF model perfectly. A real robot requires hand-eye calibration to align camera coordinates with the robot's base frame. Latency: Real actuators have physical response times. The executor would need to wait for motion completion signals from the hardware rather than stepping a simulation loop. Gripper feedback: In PyBullet, grasp success is determined by contact forces. A real gripper would provide force or torque feedback to confirm whether an object has been securely grasped. The Simulation as a Development Tool This is precisely why simulation-first development is valuable. You can iterate on the LLM prompts, agent logic, and command pipeline without risk to hardware. Once the pipeline reliably produces correct action plans in simulation, moving to a real robot is a matter of swapping the lowest layer of the stack. Key Takeaways for Developers On-device AI is production-ready. Foundry Local serves models through a standard OpenAI-compatible API. If your code already uses the OpenAI SDK, switching to local inference is a one-line change to base_url . Small models are surprisingly capable. A 0.5B parameter model produces valid JSON action plans in under 5 seconds. For constrained output schemas, you do not need a 70B model. Multi-agent pipelines are more reliable than monolithic prompts. Splitting planning, validation, execution, and narration across four agents makes each one simpler to test, debug, and replace. Simulation is the safest way to iterate. You can refine LLM prompts, agent logic, and tool schemas without risking real hardware. When the pipeline is reliable, swapping the executor for a real robot driver is the only change needed. The pattern generalises beyond robotics. Structured JSON output from an LLM, validated by a safety layer, dispatched to a domain-specific engine: that pattern works for home automation, game AI, CAD, lab equipment, and any other domain where you need safe, structured control. You can start building today. The entire project runs on a standard laptop with no GPU, no cloud account, and no API keys. Clone the repository, run the setup script, and you will have a working voice-controlled robot simulator in under five minutes. Ready to start building? Clone the repository, try the commands, and then start experimenting. Fork it, add your own agents, swap in a different simulator, or apply the pattern to an entirely different domain. The best way to learn how local AI can solve real-world problems is to build something yourself. Source code: github.com/leestott/robot-simulator-foundrylocal Built with Foundry Local, Microsoft Agent Framework, PyBullet, and FastAPI.Building a Multi-Agent On-Call Copilot with Microsoft Agent Framework
Four AI agents, one incident payload, structured triage in under 60 seconds powered by Microsoft Agent Framework and Foundry Hosted Agents. Multi-Agent Microsoft Agent Framework Foundry Hosted Agents Python SRE / Incident Response When an incident fires at 3 AM, every second the on-call engineer spends piecing together alerts, logs, and metrics is a second not spent fixing the problem. What if an AI system could ingest the raw incident signals and hand you a structured triage, a Slack update, a stakeholder brief, and a draft post-incident report, all in under 10 seconds? That’s exactly what On-Call Copilot does. In this post, we’ll walk through how we built it using the Microsoft Agent Framework, deployed it as a Foundry Hosted Agent, and discuss the key design decisions that make multi-agent orchestration practical for production workloads. The full source code is open-source on GitHub. You can deploy your own instance with a single azd up . Why Multi-Agent? The Problem with Single-Prompt Triage Early AI incident assistants used a single large prompt: “Here is the incident. Give me root causes, actions, a Slack message, and a post-incident report.” This approach has two fundamental problems: Context overload. A real incident may have 800 lines of logs, 10 alert lines, and dense metrics. Asking one model to process everything and produce four distinct output formats in a single turn pushes token limits and degrades quality. Conflicting concerns. Triage reasoning and communication drafting are cognitively different tasks. A model optimised for structured JSON analysis often produces stilted Slack messages—and vice versa. The fix is specialisation: decompose the task into focused agents, give each agent a narrow instruction set, and run them in parallel. This is the core pattern that the Microsoft Agent Framework makes easy. Architecture: Four Agents Running Concurrently On-Call Copilot is deployed as a Foundry Hosted Agent—a containerised Python service running on Microsoft Foundry’s managed infrastructure. The core orchestrator uses ConcurrentBuilder from the Microsoft Agent Framework SDK to run four specialist agents in parallel via asyncio.gather() . All four panels populated simultaneously: Triage (red), Summary (blue), Comms (green), PIR (purple). Architecture: The orchestrator runs four specialist agents concurrently via asyncio.gather(), then merges their JSON fragments into a single response. All four agents The solution share a single Azure OpenAI Model Router deployment. Rather than hardcoding gpt-4o or gpt-4o-mini , Model Router analyses request complexity and routes automatically. A simple triage prompt costs less; a long post-incident synthesis uses a more capable model. One deployment name, zero model-selection code. Meet the Four Agents 🔍 Triage Agent Root cause analysis, immediate actions, missing data identification, and runbook alignment. suspected_root_causes · immediate_actions · missing_information · runbook_alignment 📋 Summary Agent Concise incident narrative: what happened and current status (ONGOING / MITIGATED / RESOLVED). summary.what_happened · summary.current_status 📢 Comms Agent Audience-appropriate communications: Slack channel update with emoji conventions, plus a non-technical stakeholder brief. comms.slack_update · comms.stakeholder_update 📝 PIR Agent Post-incident report: chronological timeline, quantified customer impact, and specific prevention actions. post_incident_report.timeline · .customer_impact · .prevention_actions The Code: Building the Orchestrator The entry point is remarkably concise. ConcurrentBuilder handles all the async wiring—you just declare the agents and let the framework handle parallelism, error propagation, and response merging. main.py — Orchestrator from agent_framework import ConcurrentBuilder from agent_framework.azure import AzureOpenAIChatClient from azure.ai.agentserver.agentframework import from_agent_framework from azure.identity import DefaultAzureCredential, get_bearer_token_provider from app.agents.triage import TRIAGE_INSTRUCTIONS from app.agents.comms import COMMS_INSTRUCTIONS from app.agents.pir import PIR_INSTRUCTIONS from app.agents.summary import SUMMARY_INSTRUCTIONS _credential = DefaultAzureCredential() _token_provider = get_bearer_token_provider( _credential, "https://cognitiveservices.azure.com/.default" ) def create_workflow_builder(): """Create 4 specialist agents and wire them into a ConcurrentBuilder.""" triage = AzureOpenAIChatClient(ad_token_provider=_token_provider).create_agent( instructions=TRIAGE_INSTRUCTIONS, name="triage-agent", ) summary = AzureOpenAIChatClient(ad_token_provider=_token_provider).create_agent( instructions=SUMMARY_INSTRUCTIONS, name="summary-agent", ) comms = AzureOpenAIChatClient(ad_token_provider=_token_provider).create_agent( instructions=COMMS_INSTRUCTIONS, name="comms-agent", ) pir = AzureOpenAIChatClient(ad_token_provider=_token_provider).create_agent( instructions=PIR_INSTRUCTIONS, name="pir-agent", ) return ConcurrentBuilder().participants([triage, summary, comms, pir]) def main(): builder = create_workflow_builder() from_agent_framework(builder.build).run() # starts on port 8088 if __name__ == "__main__": main() Key insight: DefaultAzureCredential means there are no API keys anywhere in the codebase. The container uses managed identity in production; local development uses your az login session. The same code runs in both environments without modification. Agent Instructions: Prompts as Configuration Each agent receives a tightly scoped system prompt that defines its output schema and guardrails. Here’s the Triage Agent—the most complex of the four: app/agents/triage.py TRIAGE_INSTRUCTIONS = """\ You are the **Triage Agent**, an expert Site Reliability Engineer specialising in root cause analysis and incident response. ## Task Analyse the incident data and return a single JSON object with ONLY these keys: { "suspected_root_causes": [ { "hypothesis": "string – concise root cause hypothesis", "evidence": ["string – supporting evidence from the input"], "confidence": 0.0 // 0-1, how confident you are } ], "immediate_actions": [ { "step": "string – concrete action with runnable command if applicable", "owner_role": "oncall-eng | dba | infra-eng | platform-eng", "priority": "P0 | P1 | P2 | P3" } ], "missing_information": [ { "question": "string – what data is missing", "why_it_matters": "string – why this data would help" } ], "runbook_alignment": { "matched_steps": ["string – runbook steps that match the situation"], "gaps": ["string – gaps or missing runbook coverage"] } } ## Guardrails 1. **No secrets** – redact any credential-like material as [REDACTED]. 2. **No hallucination** – if data is insufficient, set confidence to 0 and add entries to missing_information. 3. **Diagnostic suggestions** – when data is sparse, include diagnostic steps in immediate_actions. 4. **Structured output only** – return ONLY valid JSON, no prose. """ The Comms Agent follows the same pattern but targets a different audience: app/agents/comms.py COMMS_INSTRUCTIONS = """\ You are the **Comms Agent**, an expert incident communications writer. ## Task Return a single JSON object with ONLY this key: { "comms": { "slack_update": "Slack-formatted message with emoji, severity, status, impact, next steps, and ETA", "stakeholder_update": "Non-technical summary for executives. Focus on business impact and resolution." } } ## Guidelines - Slack: Use :rotating_light: for active SEV1/2, :warning: for degraded, :white_check_mark: for resolved. - Stakeholder: No jargon. Translate to business impact. - Tone: Calm, factual, action-oriented. Never blame individuals. - Structured output only – return ONLY valid JSON, no prose. """ Instructions as config, not code. Agent behaviour is defined entirely by instruction text strings. A non-developer can refine agent behaviour by editing the prompt and redeploying no Python changes needed. The Incident Envelope: What Goes In The agent accepts a single JSON envelope. It can come from a monitoring alert webhook, a PagerDuty payload, or a manual CLI invocation: Incident Input (JSON) { "incident_id": "INC-20260217-002", "title": "DB connection pool exhausted — checkout-api degraded", "severity": "SEV1", "timeframe": { "start": "2026-02-17T14:02:00Z", "end": null }, "alerts": [ { "name": "DatabaseConnectionPoolNearLimit", "description": "Connection pool at 99.7% on orders-db-primary", "timestamp": "2026-02-17T14:03:00Z" } ], "logs": [ { "source": "order-worker", "lines": [ "ERROR: connection timeout after 30s (attempt 3/3)", "WARN: pool exhausted, queueing request (queue_depth=847)" ] } ], "metrics": [ { "name": "db_connection_pool_utilization_pct", "window": "5m", "values_summary": "Jumped from 22% to 99.7% at 14:03Z" } ], "runbook_excerpt": "Step 1: Check DB connection dashboard...", "constraints": { "max_time_minutes": 15, "environment": "production", "region": "swedencentral" } } Declaring the Hosted Agent The agent is registered with Microsoft Foundry via a declarative agent.yaml file. This tells Foundry how to discover and route requests to the container: agent.yaml kind: hosted name: oncall-copilot description: | Multi-agent hosted agent that ingests incident signals and runs 4 specialist agents concurrently via Microsoft Agent Framework ConcurrentBuilder. metadata: tags: - Azure AI AgentServer - Microsoft Agent Framework - Multi-Agent - Model Router protocols: - protocol: responses environment_variables: - name: AZURE_OPENAI_ENDPOINT value: ${AZURE_OPENAI_ENDPOINT} - name: AZURE_OPENAI_CHAT_DEPLOYMENT_NAME value: model-router The protocols: [responses] declaration exposes the agent via the Foundry Responses API on port 8088. Clients can invoke it with a standard HTTP POST no custom API needed. Invoking the Agent Once deployed, you can invoke the agent with the project’s built-in scripts or directly via curl : CLI / curl # Using the included invoke script python scripts/invoke.py --demo 2 # multi-signal SEV1 demo python scripts/invoke.py --scenario 1 # Redis cluster outage # Or with curl directly TOKEN=$(az account get-access-token \ --resource https://ai.azure.com --query accessToken -o tsv) curl -X POST \ "$AZURE_AI_PROJECT_ENDPOINT/openai/responses?api-version=2025-05-15-preview" \ -H "Authorization: Bearer $TOKEN" \ -H "Content-Type: application/json" \ -d '{ "input": [ {"role": "user", "content": "<incident JSON here>"} ], "agent": { "type": "agent_reference", "name": "oncall-copilot" } }' The Browser UI The project includes a zero-dependency browser UI built with plain HTML, CSS, and vanilla JavaScript—no React, no bundler. A Python http.server backend proxies requests to the Foundry endpoint. The empty state. Quick-load buttons pre-populate the JSON editor with demo incidents or scenario files. Demo 1 loaded: API Gateway 5xx spike, SEV3. The JSON is fully editable before submitting. Agent Output Panels Triage: Root causes ranked by confidence. Evidence is collapsed under each hypothesis. Triage: Immediate actions with P0/P1/P2 priority badges and owner roles. Comms: Slack card with emoji substitution and a stakeholder executive summary. PIR: Chronological timeline with an ONGOING marker, customer impact in a red-bordered box. Performance: Parallel Execution Matters Incident Type Complexity Parallel Latency Sequential (est.) Single alert, minimal context (SEV4) Low 4–6 s ~16 s Multi-signal, logs + metrics (SEV2) Medium 7–10 s ~28 s Full SEV1 with long log lines High 10–15 s ~40 s Post-incident synthesis (resolved) High 10–14 s ~38 s asyncio.gather() running four independent agents cuts total latency by 3–4× compared to sequential execution. For a SEV1 at 3 AM, that’s the difference between a 10-second AI-powered head start and a 40-second wait. Five Key Design Decisions Parallel over sequential Each agent is independent and processes the full incident payload in isolation. ConcurrentBuilder with asyncio.gather() is the right primitive—no inter-agent dependencies, no shared state. JSON-only agent instructions Every agent returns only valid JSON with a defined schema. The orchestrator merges fragments with merged.update(agent_output) . No parsing, no extraction, no post-processing. No hardcoded model names AZURE_OPENAI_CHAT_DEPLOYMENT_NAME=model-router is the only model reference. Model Router selects the best model at runtime based on prompt complexity. When new models ship, the agent gets better for free. DefaultAzureCredential everywhere No API keys. No token management code. Managed identity in production, az login in development. Same code, both environments. Instructions as configuration Each agent’s system prompt is a plain Python string. Behaviour changes are text edits, not code logic. A non-developer can refine prompts and redeploy. Guardrails: Built into the Prompts The agent instructions include explicit guardrails that don’t require external filtering: No hallucination: When data is insufficient, the agent sets confidence: 0 and populates missing_information rather than inventing facts. Secret redaction: Each agent is instructed to redact credential-like patterns as [REDACTED] in its output. Mark unknowns: Undeterminable fields use the literal string "UNKNOWN" rather than plausible-sounding guesses. Diagnostic suggestions: When signal is sparse, immediate_actions includes diagnostic steps that gather missing information before prescribing a fix. Model Router: Automatic Model Selection One of the most powerful aspects of this architecture is Model Router. Instead of choosing between gpt-4o , gpt-4o-mini , or o3-mini per agent, you deploy a single model-router endpoint. Model Router analyses each request’s complexity and routes it to the most cost-effective model that can handle it. Model Router insights: models selected per request with associated costs. Model Router telemetry from Microsoft Foundry: request distribution and cost analysis. This means you get optimal cost-performance without writing any model-selection logic. A simple Summary Agent prompt may route to gpt-4o-mini , while a complex Triage Agent prompt with 800 lines of logs routes to gpt-4o all automatically. Deployment: One Command The repo includes both azure.yaml and agent.yaml , so deployment is a single command: Deploy to Foundry # Deploy everything: infra + container + Model Router + Hosted Agent azd up This provisions the Foundry project resources, builds the Docker image, pushes to Azure Container Registry, deploys a Model Router instance, and creates the Hosted Agent. For more control, you can use the SDK deploy script: Manual Docker + SDK deploy # Build and push (must be linux/amd64) docker build --platform linux/amd64 -t oncall-copilot:v1 . docker tag oncall-copilot:v1 $ACR_IMAGE docker push $ACR_IMAGE # Create the hosted agent python scripts/deploy_sdk.py Getting Started Quickstart # Clone git clone https://github.com/microsoft-foundry/oncall-copilot cd oncall-copilot # Install python -m venv .venv source .venv/bin/activate # .venv\Scripts\activate on Windows pip install -r requirements.txt # Set environment variables export AZURE_OPENAI_ENDPOINT="https://<account>.openai.azure.com/" export AZURE_OPENAI_CHAT_DEPLOYMENT_NAME="model-router" export AZURE_AI_PROJECT_ENDPOINT="https://<account>.services.ai.azure.com/api/projects/<project>" # Validate schemas locally (no Azure needed) MOCK_MODE=true python scripts/validate.py # Deploy to Foundry azd up # Invoke the deployed agent python scripts/invoke.py --demo 1 # Start the browser UI python ui/server.py # → http://localhost:7860 Extending: Add Your Own Agent Adding a fifth agent is straightforward. Follow this pattern: Create app/agents/<name>.py with a *_INSTRUCTIONS constant following the existing pattern. Add the agent’s output keys to app/schemas.py . Register it in main.py : main.py — Adding a 5th agent from app.agents.my_new_agent import NEW_INSTRUCTIONS new_agent = AzureOpenAIChatClient( ad_token_provider=_token_provider ).create_agent( instructions=NEW_INSTRUCTIONS, name="new-agent", ) workflow = ConcurrentBuilder().participants( [triage, summary, comms, pir, new_agent] ) Ideas for extensions: a ticket auto-creation agent that creates Jira or Azure DevOps items from the PIR output, a webhook adapter agent that normalises PagerDuty or Datadog payloads, or a human-in-the-loop agent that surfaces missing_information as an interactive form. Key Takeaways for AI Engineers The multi-agent pattern isn’t just for chatbots. Any task that can be decomposed into independent subtasks with distinct output schemas is a candidate. Incident response, document processing, code review, data pipeline validation—the pattern transfers. Microsoft Agent Framework gives you ConcurrentBuilder for parallel execution and AzureOpenAIChatClient for Azure-native auth—you write the prompts, the framework handles the plumbing. Foundry Hosted Agents let you deploy containerised agents with managed infrastructure, automatic scaling, and built-in telemetry. No Kubernetes, no custom API gateway. Model Router eliminates the model selection problem. One deployment name handles all scenarios with optimal cost-performance tradeoffs. Prompt-as-config means your agents are iterable by anyone who can edit text. The feedback loop from “this output could be better” to “deployed improvement” is minutes, not sprints. Resources Microsoft Agent Framework SDK powering the multi-agent orchestration Model Router Automatic model selection based on prompt complexity Foundry Hosted Agents Deploy containerised agents on managed infrastructure ConcurrentBuilder Samples Official agents-in-workflow sample this project follows DefaultAzureCredential Zero-config auth chain used throughout Hosted Agents Concepts Architecture overview of Foundry Hosted Agents The On-Call Copilot sample is open source under the MIT licence. Contributions, scenario files, and agent instruction improvements are welcome via pull request.
Building High-Performance Agentic Systems
Most enterprise chatbots fail in the same quiet way. They answer questions. They impress in demos. And then they stall in production. Knowledge goes stale. Answers cannot be audited. The system cannot act beyond generating text. When workflows require coordination, execution, or accountability, the chatbot stops being useful. Agentic systems exist because that model is insufficient. Instead of treating the LLM as the product, agentic architecture embeds it inside a bounded control loop: plan → act (tools) → observe → refine The model becomes one component in a runtime system with explicit state management, safety policies, identity enforcement, and operational telemetry. This shift is not speculative. A late-2025 MIT Sloan Management Review / BCG study reports that 35% of organizations have already adopted AI agents, with another 44% planning deployment. Microsoft is advancing open protocols for what it calls the “agentic web,” including Agent-to-Agent (A2A) interoperability and Model Context Protocol (MCP), with integration paths emerging across Copilot Studio and Azure AI Foundry. The real question is no longer whether agents are coming. It is whether enterprise architecture is ready for them. This article translates “agentic” into engineering reality: the runtime layers, latency and cost levers, orchestration patterns, and governance controls required for production deployment. The Core Capabilities of Agentic AI What makes an AI “agentic” is not a single feature—it’s the interaction of different capabilities. Together, they form the minimum set needed to move from “answering” to “operating”. Autonomy – Goal-Driven Task Completion Traditional bots are reactive: they wait for a prompt and produce output. Autonomy introduces a goal state and a control loop. The agent is given an objective (or a trigger) and it can decide the next step without being micromanaged. The critical engineering distinction is that autonomy must be bounded: in production, you implement it with explicit budgets and stop conditions—maximum tool calls, maximum retries, timeouts, and confidence thresholds. The typical execution shape is a loop: plan → act → observe → refine. A project-management agent, for example, doesn’t just answer “what’s the status?” It monitors signals (work items, commits, build health), detects a risk pattern (slippage, dependency blockage), and then either surfaces an alert or prepares a remediation action (re-plan milestones, notify owners). In high-stakes environments, autonomy is usually human-in-the-loop by design: the agent can draft changes, propose next actions, and only execute after approval. Over time, teams expand the autonomy envelope for low-risk actions while keeping approvals for irreversible or financially sensitive operations. Tool Integration – Taking Action and Staying Current A standalone LLM cannot fetch live enterprise state and cannot change it. Tool integration is how an agent becomes operational: it can query systems of record, call APIs, trigger workflows, and produce outputs that reflect the current world rather than the model’s pretraining snapshot. There are two classes of tools that matter in enterprise agents: Retrieval tools (grounding / RAG)When the agent needs facts, it retrieves them. This is the backbone of reducing hallucination: instead of guessing, the agent pulls authoritative content (SharePoint, Confluence, policy repositories, CRM records, Fabric datasets) and uses it as evidence. In practice, retrieval works best when it is engineered as a pipeline: query rewrite (optional) → hybrid search (keyword + vector) → filtering (metadata/ACL) → reranking → compact context injection. The point is not “stuff the prompt with documents,” but “inject only the minimum evidence required to answer accurately.” Action tools (function calling / connectors) These are the hands of the agent: update a CRM record, create a ticket, send an email, schedule a meeting, generate a report, run a pipeline. Tool integration shifts value from “advice” to “execution,” but also introduces risk—so action tools need guardrails: least-privilege permissions, input validation, idempotency keys, and post-condition checks (confirm the update actually happened). In Microsoft ecosystems, this tool plane often maps to Graph actions + business connectors (via Logic Apps/Power Automate) + custom APIs, with Copilot Studio (low code) or Foundry-style runtimes (pro code) orchestrating the calls. Memory (Context & Learning) – Context Awareness and Adaptation “Memory” is not just a long prompt. In agentic systems, memory is an explicit state strategy: Working memory: what the agent has learned during the current run (intermediate tool results, constraints, partial plans). Session memory: what should persist across turns (user preferences, ongoing tasks, summarized history). Long-term memory: enterprise knowledge the agent can retrieve (indexed documents, structured facts, embeddings + metadata). Short-term memory enables multi-step workflows without repeating questions. An HR onboarding agent can carry a new hire’s details from intake through provisioning without re-asking, because the workflow state is persisted and referenced. Long-term “learning” is typically implemented through feedback loops rather than real-time model weight updates: capturing corrections, storing validated outcomes, and periodically improving prompts, routing logic, retrieval configuration, or (where appropriate) fine-tuning. The key design rule is that memory must be policy-aware: retention rules, PII handling, and permission trimming apply to stored state as much as they apply to retrieved documents. Orchestration – Coordinating Multi-Agent Teams Complex enterprise work is rarely single-skill. Orchestration is how agentic systems scale capability without turning one agent into an unmaintainable monolith. The pattern is “manager + specialists”: an orchestrator decomposes the goal into subtasks, routes each to the best tool or sub-agent, and then composes a final response. This can be done sequentially or in parallel. Employee onboarding is a classic: HR intake, IT account creation, equipment provisioning, and training scheduling can run in parallel where dependencies allow. The engineering challenge is making orchestration reliable: defining strict input/output contracts between agents (often structured JSON), handling failures (timeouts, partial completion), and ensuring only one component has authority to send the final user-facing message to avoid conflicting outputs. In Microsoft terms, orchestration can be implemented as agentic flows in Copilot Studio, connected-agent patterns in Foundry, or explicit orchestrators in code using structured tool schemas and shared state. Strategic Impact – How Agentic AI Changes Knowledge Work Agentic AI is no longer an experimental overlay to enterprise systems. It is becoming an embedded operational layer inside core workflows. Unlike earlier chatbot deployments that answered isolated questions, modern enterprise agents execute end-to-end processes, interact with structured systems, maintain context, and operate within governed boundaries. The shift is not about conversational intelligence alone; it is about workflow execution at scale. The transformation becomes clearer when examining real implementations across industries. In legal services, agentic systems have moved beyond document summarization into operational case automation. Assembly Software’s NeosAI, built on Azure AI infrastructure, integrates directly into legal case management systems and automates document analysis, structured data extraction, and first-draft generation of legal correspondence. What makes this deployment impactful is not merely the generative drafting capability, but the integration architecture. NeosAI is not an isolated chatbot; it operates within the same document management systems, billing systems, and communication platforms lawyers already use. Firms report time savings of up to 25 hours per case, with document drafting cycles reduced from days to minutes for first-pass outputs. Importantly, the system runs within secure Azure environments with zero data retention policies, addressing one of the most sensitive concerns in legal AI adoption: client confidentiality. JPMorgan’s COiN platform represents another dimension of legal and financial automation. Instead of conversational assistance, COiN performs structured contract intelligence at production scale. It analyzes more than 12,000 commercial loan agreements annually, extracting over 150 clause attributes per document. Work that previously required approximately 360,000 human hours now executes in seconds. The architecture emphasizes structured NLP pipelines, taxonomy-based clause classification, and private cloud deployment for regulatory compliance. Rather than replacing legal professionals, the system flags unusual clauses for human review, maintaining oversight while dramatically accelerating analysis. Over time, COiN has also served as a knowledge retention mechanism, preserving institutional contract intelligence that would otherwise be lost with employee turnover. In financial services, the impact is similarly structural. Morgan Stanley’s internal AI Assistant allows wealth advisors to query over 100,000 proprietary research documents using natural language. Adoption has reached nearly universal usage across advisor teams, not because it replaces expertise, but because it compresses research time and surfaces insights instantly. Building on this foundation, the firm introduced an AI meeting debrief agent that transcribes client conversations using speech-to-text models and generates CRM notes and follow-up drafts through GPT-based reasoning. Advisors review outputs before finalization, preserving human judgment. The result is faster client engagement and measurable productivity improvements. What differentiates Morgan Stanley’s approach is not only deployment scale, but disciplined evaluation before release. The firm established rigorous benchmarking frameworks to test model outputs against expert standards for accuracy, compliance, and clarity. Only after meeting defined thresholds were systems expanded firmwide. This pattern—evaluation before scale—is becoming a defining trait of successful enterprise agent deployment. Human Resources provides a different perspective on agentic AI. Johnson Controls deployed an AI HR assistant inside Slack to manage policy questions, payroll inquiries, and onboarding support across a global workforce exceeding 100,000 employees. By embedding the agent in a channel employees already use, adoption barriers were reduced significantly. The result was a 30–40% reduction in live HR call volume, allowing HR teams to redirect focus toward strategic workforce initiatives. Similarly, Ciena integrated an AI assistant directly into Microsoft Teams, unifying HR and IT support through a single conversational interface. Employees no longer navigate separate portals; the agent orchestrates requests across backend systems such as Workday and ServiceNow. The technical lesson here is clear: integration breadth drives usability, and usability drives adoption. Engineering and IT operations reveal perhaps the most technically sophisticated application of agentic AI: multi-agent orchestration. In a proof-of-concept developed through collaboration between Microsoft and ServiceNow, an AI-driven incident response system coordinates multiple agents during high-priority outages. Microsoft 365 Copilot transcribes live war-room discussions and extracts action items, while ServiceNow’s Now Assist executes operational updates within IT service management systems. A Semantic Kernel–based manager agent maintains shared context and synchronizes activity across platforms. This eliminates the longstanding gap between real-time discussion and structured documentation, automatically generating incident reports while freeing engineers to focus on remediation rather than clerical tasks. The system demonstrates that orchestration is not conceptual—it is operational. Across these examples, the pattern is consistent. Agentic AI changes knowledge work by absorbing structured cognitive labor: document parsing, compliance classification, research synthesis, workflow routing, transcription, and task coordination. Humans remain essential for judgment, ethics, and accountability, but the operational layer increasingly runs through AI-mediated execution. The result is not incremental productivity improvement; it is structural acceleration of knowledge processes. Design and Governance Challenges – Managing the Risks As agentic AI shifts from answering questions to executing workflows, governance must mature accordingly. These systems retrieve enterprise data, invoke APIs, update records, and coordinate across platforms. That makes them operational actors inside your architecture—not just assistants. The primary shift is this: autonomy increases responsibility. Agents must be observable. Every retrieval, reasoning step, and tool invocation should be traceable. Without structured telemetry and audit trails, enterprises lose visibility into why an agent acted the way it did. Agents must also operate within scoped authority. Least-privilege access, role-based identity, and bounded credentials are essential. An HR agent should not access finance systems. A finance agent should not modify compliance data without policy constraints. Autonomy only works when it is deliberately constrained. Execution boundaries are equally critical. High-risk actions—financial approvals, legal submissions, production changes—should include embedded thresholds or human approval gates. Autonomy should be progressive, not absolute. Cost and performance must be governed just like cloud infrastructure. Agentic systems can trigger recursive calls and model loops. Without usage monitoring, rate limits, and model-tier routing, compute consumption can escalate unpredictably. Finally, agentic systems require continuous evaluation. Real-world testing, live monitoring, and drift detection ensure the system remains aligned with business rules and compliance requirements. These are not “set and forget” deployments. In short, agentic AI becomes sustainable only when autonomy is paired with observability, scoped authority, embedded guardrails, cost control, and structured oversight. Conclusion – Towards the Agentic Enterprise The organizations achieving meaningful returns from agentic AI share a common pattern. They do not treat AI agents as experimental tools. They design them as production systems with defined roles, scoped authority, measurable KPIs, embedded observability, and formal governance layers. When autonomy is paired with integration, memory, orchestration, and governance discipline, agentic AI becomes more than automation—it becomes an operational architecture. Enterprises that master this architecture are not merely reducing costs; they are redefining how knowledge work is executed. In this emerging model, human professionals focus on strategic judgment and innovation, while AI agents manage structured cognitive execution at scale. The competitive advantage will not belong to those who deploy the most AI, but to those who deploy it with architectural rigor and governance maturity. Before we rush to deploy more agents, a few questions are worth asking: If an AI agent executes a workflow in your enterprise today, can you trace every reasoning step and tool invocation behind that decision? Does your architecture treat AI as a conversational layer - or as an operational actor with scoped identity, cost controls, and policy enforcement? Where should autonomy stop in your organization - and who defines that boundary? Agentic AI is not just a capability shift. It is an architectural decision. Curious to hear how others are designing their control planes and orchestration layers. References MIT Sloan – “Agentic AI, Explained” by Beth Stackpole: A foundational overview of agentic AI, its distinction from traditional generative AI, and its implications for enterprise workflows, governance, and strategy. Microsoft TechCommunity – “Introducing Multi-Agent Orchestration in Foundry Agent Service”: Details Microsoft’s multi-agent orchestration capabilities, including Connected Agents, Multi-Agent Workflows, and integration with A2A and MCP protocols. Microsoft Learn – “Extend the Capabilities of Your Agent – Copilot Studio”: Explains how to build and extend custom agents in Microsoft Copilot Studio using tools, connectors, and enterprise data sources. Assembly Software’s NeosAI case – Microsoft Customer Stories JPMorgan COiN platform – GreenData Case Study HR support AI (Johnson Controls, Ciena, Databricks) – Moveworks case studies ServiceNow & Semantic Kernel multi-agent P1 Incident – Microsoft Semantic Kernel Blog🚀 AI Toolkit for VS Code — February 2026 Update
February brings a major milestone for AI Toolkit. Version 0.30.0 is packed with new capabilities that make agent development more discoverable, debuggable, and production-ready—from a brand-new Tool Catalog, to an end-to-end Agent Inspector, to treating evaluations as first-class tests. 🔧 New in v0.30.0 🧰 Tool Catalog: One place to discover and manage agent tools The new Tool Catalog is a centralized hub for discovering, configuring, and integrating tools into your AI agents. Instead of juggling scattered configs and definitions, you now get a unified experience for tool management: Browse, search, and filter tools from the public Foundry catalog and local stdio MCP servers Configure connection settings for each tool directly in VS Code Add tools to agents seamlessly via Agent Builder Manage the full tool lifecycle: add, update, or remove tools with confidence Why it matters: expanding your agent’s capabilities is now a few clicks away—and stays manageable as your agent grows. 🕵️ Agent Inspector: Debug agents like real software The new Agent Inspector turns agent debugging into a first-class experience inside VS Code. Just press F5 and launch your agent with full debugger support. Key highlights: One-click F5 debugging with breakpoints, variable inspection, and step-through execution Copilot auto-configuration that scaffolds agent code, endpoints, and debugging setup Production-ready code generated using the Hosted Agent SDK, ready for Microsoft Foundry Real-time visualization of streaming responses, tool calls, and multi-agent workflows Quick code navigation—double-click workflow nodes to jump straight to source Unified experience combining chat and workflow visualization in one view Why it matters: agents are no longer black boxes—you can see exactly what’s happening, when, and why. 🧪 Evaluation as Tests: Treat quality like code With Evaluation as Tests, agent quality checks now fit naturally into existing developer workflows. What’s new: Define evaluations as test cases using familiar pytest syntax and Eval Runner SDK annotations Run evaluations directly from VS Code Test Explorer, mixing and matching test cases Analyze results in a tabular view with Data Wrangler integration Submit evaluation definitions to run at scale in Microsoft Foundry Why it matters: evaluations are no longer ad-hoc scripts—they’re versioned, repeatable, and CI-friendly. 🔄 Improvements across the Toolkit 🧱 Agent Builder Agent Builder received a major usability refresh: Redesigned layout for better navigation and focus Quick switcher to move between agents effortlessly Support for authoring, running, and saving Foundry prompt agents Add tools to Foundry prompt agents directly from the Tool Catalog or built-in tools New Inspire Me feature to help you get started when drafting agent instructions Numerous performance and stability improvements 🤖 Model Catalog Added support for models using the OpenAI Response API, including gpt-5.2-codex General performance and reliability improvements 🧠 Build Agent with GitHub Copilot New Workflow entry point to quickly generate multi-agent workflows with Copilot Ability to orchestrate workflows by selecting prompt agents from Foundry 🔁 Conversion & Profiling Generate interactive playgrounds for history models Added Qualcomm GPU recipes Show resource usage for Phi Silica directly in Model Playground ✨ Wrapping up Version 0.30.0 is a big step forward for AI Toolkit. With better discoverability, real debugging, structured evaluation, and deeper Foundry integration, building AI agents in VS Code now feels much closer to building production software. As always, we’d love your feedback—keep it coming, and happy agent building! 🚀Announcing Public Preview: AI Toolkit for GitHub Copilot Prompt-First Agent Development
This week at GitHub Universe, we’re announcing the Public Preview of the GitHub Copilot prompt-first agent development in the AI Toolkit for Visual Studio Code. With this release, building powerful AI agents is now simpler and faster - no need to wrestle with complex frameworks or orchestrators. Just start with natural language prompts and let GitHub Copilot guide you from concept to working agent code. Accelerate Agent Development in VS Code The AI Toolkit embeds agent development workflows directly into Visual Studio Code and GitHub Copilot, enabling you to transform ideas into production-ready agents within minutes. This unified experience empowers developers and product teams to: Select the best model for your agent scenario Build and orchestrate agents using Microsoft Agent Framework Trace agent behaviors Evaluate agent response quality Select the best model for your scenario Models are the foundation for building powerful agents. Using the AI Toolkit, you can already explore and experiment with a wide range of local and remote models. Copilot now recommends models tailored to your agent’s needs, helping you make informed choices quickly. Build and orchestrate agents Whether you’re creating a single agent or designing a multi-agent workflow, Copilot leverages the latest Microsoft Agent Framework to generate robust agent code. You can initiate agent creation with simple prompts and visualize workflows for greater clarity and control. Create a single agent using Copilot Create a multi-agent workflow using Copilot and visualize workflow execution Trace agent behaviors As agents become more sophisticated, understanding their actions is crucial. The AI Toolkit enables tracing via Copilot, collecting local traces and displaying detailed agent calls, all within VS Code. Evaluate agent response quality Copilot guides you through structured evaluation, recommending metrics and generating test datasets. Integrate evaluations into your CI/CD pipeline for continuous quality assurance and confident deployments. Get started and share feedback This release marks a significant step toward making AI agent development easier and more accessible in Visual Studio Code. Try out the AI Toolkit for Visual Studio Code, share your thoughts, and file issues and suggest features on our GitHub repo. Thank you for being a part of this journey with us!AI Toolkit for VS Code October Update
We're thrilled to bring you the October update for the AI Toolkit for Visual Studio Code! This month marks another major milestone with version 0.24.0, introducing groundbreaking GitHub Copilot Tools Integration and additional user experience enhancements that make AI-powered development more seamless than ever. Let's dive into what's new! 👇 🚀 GitHub Copilot Tools Integration We are excited to announce the integration of GitHub Copilot Tools into AI Toolkit for VS Code. This integration empowers developers to build AI-powered applications more efficiently by leveraging Copilot's capabilities enhanced by AI Toolkit. 🤖 AI Agent Code Generation Tool This powerful tool provides best practices, guidance, steps, and code samples on Microsoft Agent Framework for GitHub Copilot to better scaffold AI agent applications. Whether you're building your first agent or scaling complex multi-agent systems, this tool ensures you follow the latest best practices and patterns. 📊 AI Agent Evaluation Planner Tool Building great AI agents requires thorough evaluation. This tool guides users through the complete process of evaluating AI agents, including: Defining evaluation metrics - Establish clear success criteria for your agents Creating evaluation datasets - Generate comprehensive test datasets Analyzing results - Understand your agent's performance and areas for improvement The Evaluation Planner works seamlessly with two specialized sub-tools: 🏃♂️ Evaluation Agent Runner Tool This tool runs agents on provided datasets and collects results, making it easy to test your agents at scale across multiple scenarios and use cases. 💻 Evaluation Code Generation Tool Get best practices, guidance, steps, and code samples on Azure AI Foundry Evaluation Framework for GitHub Copilot to better scaffold code for evaluating AI agents. 🎯 Easy Access and Usage You can access these powerful tools in two convenient ways: Direct GitHub Copilot Integration: Simply enter prompts like: Create an AI agent using Microsoft Agent Framework to help users plan a trip to Paris. Evaluate the performance of my AI agent using Azure AI Foundry Evaluation Framework. AI Toolkit Tree View: For quick access, find these tools in the AI Toolkit Tree View UI under the section `Build Agent with GitHub Copilot`. ✨ Additional Enhancements 🎨 Model Playground Improvements The user experience in Model Playground has been significantly enhanced: Resizable Divider: The divider between chat output and model settings is now resizable, allowing you to customize your workspace layout for better usability and productivity. 📚 Model Catalog Updates We've unified and streamlined the model discovery experience: Unified Local Models: The ONNX models section in the Model Catalog has been merged with Foundry Local Models on macOS and Windows platforms, providing a unified experience for discovering and selecting local models. Simplified Navigation: Find all your local model options in one place, making it easier to compare and select the right model for your use case. ## 🌟 Why This Release Matters Version 0.24.0 represents a significant step forward in making AI development more accessible and efficient: Seamless Integration: The deep integration with GitHub Copilot means AI best practices are now available right where you're already working. End-to-End Workflow: From agent creation to evaluation, you now have comprehensive tooling that guides you through the entire AI development lifecycle. Enhanced Productivity: Improved UI elements and unified experiences reduce friction and help you focus on building great AI applications. 🚀 Get Started and Share Your Feedback Ready to experience the future of AI development? Here's how to get started: 📥 Download: Install the AI Toolkit from the Visual Studio Code Marketplace 📖 Learn: Explore our comprehensive AI Toolkit Documentation 🔍 Discover: Check out the complete changelog for v0.24.0 We'd love to hear from you! Whether it's a feature request, bug report, or feedback on your experience, join the conversation and contribute directly on our GitHub repository. 🎯 What's Next? This release sets the foundation for even more exciting developments ahead. The GitHub Copilot Tools Integration opens up new possibilities for AI-assisted development, and we're just getting started. Stay tuned for more updates, and let's continue building the future of AI agent development together! 💡💬 Happy coding, and see you next month! 🚀Introducing the Microsoft Agent Framework
Introducing the Microsoft Agent Framework: A Unified Foundation for AI Agents and Workflows The landscape of AI development is evolving rapidly, and Microsoft is at the forefront with the release of the Microsoft Agent Framework an open-source SDK designed to empower developers to build intelligent, multi-agent systems with ease and precision. Whether you're working in .NET or Python, this framework offers a unified, extensible foundation that merges the best of Semantic Kernel and AutoGen, while introducing powerful new capabilities for agent orchestration and workflow design. Introducing Microsoft Agent Framework: The Open-Source Engine for Agentic AI Apps | Azure AI Foundry Blog Introducing Microsoft Agent Framework | Microsoft Azure Blog Why Another Agent Framework? Both Semantic Kernel and AutoGen have pioneered agentic development, Semantic Kernel with its enterprise-grade features and AutoGen with its research-driven abstractions. The Microsoft Agent Framework is the next generation of both, built by the same teams to unify their strengths: AutoGen’s simplicity in multi-agent orchestration. Semantic Kernel’s robustness in thread-based state management, telemetry, and type safety. New capabilities like graph-based workflows, checkpointing, and human-in-the-loop support This convergence means developers no longer have to choose between experimentation and production. The Agent Framework is designed to scale from single-agent prototypes to complex, enterprise-ready systems Core Capabilities AI Agents AI agents are autonomous entities powered by LLMs that can process user inputs, make decisions, call tools and MCP servers, and generate responses. They support providers like Azure OpenAI, OpenAI, and Azure AI, and can be enhanced with: Agent threads for state management. Context providers for memory. Middleware for action interception. MCP clients for tool integration Use cases include customer support, education, code generation, research assistance, and more—especially where tasks are dynamic and underspecified. Workflows Workflows are graph-based orchestrations that connect multiple agents and functions to perform complex, multi-step tasks. They support: Type-based routing Conditional logic Checkpointing Human-in-the-loop interactions Multi-agent orchestration patterns (sequential, concurrent, hand-off, Magentic) Workflows are ideal for structured, long-running processes that require reliability and modularity. Developer Experience The Agent Framework is designed to be intuitive and powerful: Installation: Python: pip install agent-framework .NET: dotnet add package Microsoft.Agents.AI Integration: Works with Foundry SDK, MCP SDK, A2A SDK, and M365 Copilot Agents Samples and Manifests: Explore declarative agent manifests and code samples Learning Resources: Microsoft Learn modules AI Agents for Beginners AI Show demos Azure AI Foundry Discord community Migration and Compatibility If you're currently using Semantic Kernel or AutoGen, migration guides are available to help you transition smoothly. The framework is designed to be backward-compatible where possible, and future updates will continue to support community contributions via the GitHub repository. Important Considerations The Agent Framework is in public preview. Feedback and issues are welcome on the GitHub repository. When integrating with third-party servers or agents, review data sharing practices and compliance boundaries carefully. The Microsoft Agent Framework marks a pivotal moment in AI development, bringing together research innovation and enterprise readiness into a single, open-source foundation. Whether you're building your first agent or orchestrating a fleet of them, this framework gives you the tools to do it safely, scalably, and intelligently. Ready to get started? Download the SDK, explore the documentation, and join the community shaping the future of AI agents.How do I choose the right model for my agent?
Welcome back to Agent Support—a developer advice column for those head-scratching moments when you’re building an AI agent! Each post answers a real question from the community with simple, practical guidance to help you build smarter agents. Today’s question comes from a developer that’s right at the beginning of their agent building journey and needs a little help choosing a model. 💬 Dear Agent Support I’m overwhelmed by all the model options out there. Some are small, some are huge. Some are free, some cost a lot. Some say “multimodal” but I’m not sure if I need that. How do I choose the right model for my agent? Great question! Model choice is one of the most important design decisions you’ll make. Pick something too small, and your agent may struggle with complex tasks. Go too big, and you could be paying for power you don’t need. Let’s break down the key factors to consider. 🧩 Capabilities vs. Use Case The first—and most important—question isn’t which model is “best.” It’s what does my agent actually need to do? Here’s a few angles to think through: Input and Output Types Will your agent only handle text, or does it need to process other formats like images, audio, or structured data? Models differ in how many modalities they support and in how well they can handle outputs that must follow strict formatting. Complexity of Tasks Simple, transactional tasks (like pulling information from a document or answering straightforward queries) don’t require the same reasoning depth as tasks that involve planning, multi-step logic, or open-ended creativity. Define the level of reasoning and adaptability your agent needs. Control Requirements Some agents need highly controlled outputs (think JSON schemas for downstream services), while others benefit from free-form creativity. The degree of control you need (i.e. structured output, function calling, system prompt) should guide model choice. Domain Knowledge Does your agent operate in a general-purpose domain, or does it need strong understanding of a specific area (like legal, medical, or technical documentation)? Consider whether you’ll rely on the model’s built-in knowledge, retrieval from external sources, or fine-tuning for domain expertise. Interaction Style Will users interact with the agent in short, direct prompts, or longer, conversational exchanges? Some models handle chat-like, multi-turn contexts better than others, while others excel at single-shot completions. In short: start by mapping out your agent’s needs in terms of data types, reasoning depth, control, domain, and interaction style. Once you have that picture, it’s much easier to narrow down which models are a genuine fit, and which ones would be mismatched. ⚖️ Performance vs. Cost Once you know what your agent needs to do, the next trade-off is between performance and cost. Bigger models are often more capable, but they also come with higher latency, usage costs, and infrastructure requirements. The trick is to match “enough performance” to the real-world expectations for your agent. Here are some factors to weigh: Task Complexity vs. Model Size If your agent’s tasks involve nuanced reasoning, long-context conversations, or open-ended problem solving, a more capable (and often larger) model may be necessary. On the other hand, for lightweight lookups or structured Q&A, a smaller model can perform just as well, and more efficiently. Response Time Expectations Latency matters. A model that takes 8–10 seconds to respond may be fine in a batch-processing workflow but frustrating in a real-time chat interface. Think about how quickly your users expect the agent to respond and whether you’re willing to trade speed for accuracy. Budget and Token Costs Larger models consume more tokens per request, which translates to higher costs, especially if your agent will scale to many users. Consider both per-request cost and aggregate monthly cost based on expected usage volume. Scaling Strategy Some developers use a “tiered” approach: route simple queries to a smaller, cheaper model and reserve larger models for complex tasks. This can balance performance with budget without compromising user experience. The Azure AI Founder Model Router performs in a similar manner. Experimentation Over Assumptions Don’t assume the largest model is always required. Start with something mid-range, test it against your use case, and only scale up if you see gaps. This iterative approach often prevents overspending. At the end of the day, performance isn’t about squeezing the most power out of a model, it’s about choosing the right amount of capability for the job, without paying for what you don’t need. 🔑 Licensing and Access Even if you’ve found a model that looks perfect on paper, practical constraints around access and licensing can make or break your choice. These considerations often get overlooked until late in the process, but they can have big downstream impacts. A few things to keep in mind: Where the Model Lives Some models are only accessible through a hosted API (like on a cloud provider), while others are open source and can be self-hosted. Hosted APIs are convenient and handle scaling for you, but they also lock you into availability, pricing, and rate limits set by the provider. Self-hosting gives you control, but also means managing infrastructure, updates, and security yourself. Terms of Use Pay attention to licensing restrictions. Some providers limit usage for commercial products, sensitive data, or high-risk domains (like healthcare or finance). Others may require explicit consent or premium tiers to unlock certain capabilities. Data Handling and Privacy If your agent processes sensitive or user-specific data, you’ll need to confirm whether the model provider logs, stores, or uses data for training. Check for features like “no data retention” modes, private deployments, or enterprise SLAs if compliance is critical. Regional Availability Certain models or features may only be available in specific regions due to infrastructure or regulatory constraints. This matters if your users are global, or if you need to comply with data residency laws (e.g., keeping data in the EU). Support for Deployment Options Consider whether the model can be deployed in the way you need—API-based integration, on-prem deployment, or edge devices. If you’re building something that runs locally (say, on a mobile app), an enormous cloud-only model won’t be practical. Longevity and Ecosystem Models evolve quickly. Some experimental models may not be supported long-term, while others are backed by a stable provider with ongoing updates. Think about how much you want to bet on a model that might disappear in six months versus one with a roadmap you can count on. Model choice isn’t just about capability and performance, it’s also about whether you can use it under the terms, conditions, and environments that your project requires. 🔍 Exploring Models with Azure AI Foundry Once you’ve thought through capabilities, performance trade-offs, and licensing, the next step is exploring what’s available to you. If you’re building with Azure, this is where the Azure AI Foundry Models becomes invaluable. Instead of guessing which model might fit, you can browse, filter, and compare options directly, complete with detailed model cards that outline features, intended use cases, and limitations. Think of the model catalog as your “shopping guide” for models: it helps you quickly spot which ones align with your agent’s needs and gives you the fine print before you commit. 🔁 Recap Here’s a quick rundown of what we covered: Start with capabilities. Match the model’s strengths to the inputs, outputs, and complexity your agent requires. Balance performance with cost. Bigger isn’t always better. Pick the right level of capability without overspending. Review licensing and access. Make sure the model is available in your region, permitted for your use case, and deployed in the way you need. Explore before you build. Use the Azure AI Foundry Model Catalog to filter options, read model cards, and test in the Playground. 📺 Want to Go Deeper? With so many new models available on an almost daily basis, it can be a challenge to keep up with what’s new! However, our Model Mondays series has you covered! Each week, we bring to you the latest news in AI models. We also recently launched our brand-new series: Inside Azure AI Foundry. In this series, we dive deep into the latest AI models, tools, and platform features — with practical demos and technical walkthroughs that show you how to integrate them into your workflows. It’s perfect for developers who want to see capabilities in action before deploying them in real projects. As always remember, your agent doesn’t need the “best” model on paper—it needs the right model for the job it’s designed to do.How do I catch bad data before it derails my agent?
How do I catch bad data before it derails my agent? When an agent relies on data that’s incomplete, inconsistent, or plain wrong, every downstream step inherits that problem. You will waste time debugging hallucinations that are actually caused by a stray “NULL” string, or re-running fine-tunes because of invisible whitespace in a numeric column. Even small quality issues can: Skew model evaluation metrics. Trigger exceptions in your application code. Undermine user trust when answers look obviously off. The bottom line is that a five-minute inspection up front can save hours later.How do I A/B test different versions of my agent?
We tend to think of A/B testing as a marketer’s tool (i.e. headline A vs. headline B). But it’s just as useful for developers building agents. Why? Because most agent improvements are experimental. You’re changing one or more of the following: the system prompt the model the tool selection the output format the interaction flow But without a structured way to test those changes, you’re just guessing. You might think your updated version is smarter or more helpful…but until you compare, you won’t know! A/B testing helps you turn instincts into insight and gives you real data to back your next decision.
