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The $150B M365 Adoption Gap: Why Feature Usage Plateaus

Research shows most organisations use less than 40% of M365 capabilities. We explore why traditional training fails and what works instead.

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redthrd Team
15 November 2024

Microsoft 365 is the world's most widely deployed productivity suite, with over 345 million paid seats globally. At an average cost of $20-50 per user per month, organisations are investing billions annually in M365 licenses. Yet research consistently shows that most users engage with less than 40% of available features.

$150B
The annual adoption gap in enterprise software

This isn't just a training problem—it's a massive opportunity cost that most organisations don't even measure.

The Plateau Effect

When organisations deploy M365, they typically see a predictable pattern:

Week 1-4
Initial excitement
Month 2-3
Familiar patterns
Month 4+
Plateau at 30-40%

This plateau isn't due to lack of training. Most organisations invest heavily in onboarding, creating documentation, and running workshops. The problem is that traditional training doesn't change behaviour—it just transfers information.

Why Traditional Training Fails

1. Wrong Time

Training typically happens during onboarding or scheduled sessions—not when users actually need to perform a task. By the time they're in the moment, they've forgotten 90% of what they learned.

2. Wrong Content

Generic training covers features that may not be relevant to a specific user's role or workflow. A finance analyst and a marketing manager have very different M365 needs, but often receive identical training.

3. Wrong Measurement

Most organisations measure training completion, not behaviour change. An employee can complete every module and still never use the features in their daily work.

What Actually Works

Research in behavioural science and learning design points to a different approach:

Contextual Learning

People learn best when information is delivered in context—when they're actually trying to accomplish a task. This is why Google searches are so effective: they provide answers at the exact moment of need.

Personalisation

Not everyone needs to learn the same things. Effective adoption programs identify individual gaps and opportunities based on actual usage patterns, then deliver targeted content.

Behaviour-Based Measurement

The only metric that matters is whether people change how they work. This requires tracking actual usage before and after interventions—not just counting course completions.

The Path Forward

Instead of pushing information at users, we need to pull insights from how they actually work.

Closing the M365 adoption gap requires:

  • Pull insights from actual usage data
  • Push relevant content at the right moment
  • Measure real behaviour change
  • Adapt continuously based on outcomes

This is exactly what we're building at redthrd. Not another training platform, but an intelligence layer that understands how people work and helps them work better.

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