Artificial intelligence is transforming the way small businesses work, whether it’s writing emails, summarising meetings, or drafting proposals, tools like Microsoft 365 Copilot and ChatGPT for Business promise massive productivity gains.
But here’s the catch: while both use generative AI, they’re not built the same, especially when it comes to security and data privacy.
At Commercial Networks, we help SMBs harness AI safely, ensuring innovation never comes at the expense of compliance. So let’s unpack how these two tools really compare, and which one fits your business best.
Microsoft 365 Copilot vs ChatGPT, What’s the Difference?
At a glance, both tools look similar: you type a prompt, and the AI produces text, summaries, or answers. But the key difference lies in where they get their information and how they handle your data.
Microsoft 365 Copilot lives inside the Microsoft ecosystem; Word, Excel, Outlook, Teams, and PowerPoint. It uses your business’s existing data (emails, chats, documents, calendar entries) securely within your Microsoft 365 environment and that means it works for your business, using your own data that never leaves your tenant.
ChatGPT, on the other hand, is a standalone AI tool developed by OpenAI. It’s brilliant for creative ideas, general information, and fast drafting, but it sits outside your company’s IT framework and, unless you use the ChatGPT Enterprise or API versions, your prompts are processed on OpenAI’s servers, which raises questions about data privacy and compliance.
In short: Copilot works with your data; ChatGPT learns from the world’s data.
How SMBs Are Using Each Tool
SMBs are adopting both tools in clever ways:
- Microsoft 365 Copilot: generating reports, creating proposals from templates, summarising Teams meetings, or drafting customer communications directly within Microsoft apps.
- ChatGPT for Business: brainstorming marketing ideas, writing blog outlines, generating social captions, or creating quick code snippets.
Used together, they’re powerful, Copilot for productivity and integration; ChatGPT for creativity and ideation. The challenge is knowing when to use which tool safely.
AI Security for SMBs – Why It Matters
AI is only as safe as the data it touches and for most SMBs, that data includes sensitive client information, credentials, financial details, and internal documents. Once it’s uploaded to a third-party AI tool, you lose control over where it’s processed and who might access it.
This is where AI security for SMBs becomes critical. According to the NCSC, companies adopting AI should treat data shared with large language models as if it could become public. The risk isn’t that ChatGPT is “unsafe,” but that it’s not built for confidential business data unless you’re using its enterprise version.
Microsoft, by contrast, designed 365 Copilot within the company’s existing compliance and data protection framework. According to Microsoft’s Copilot security overview:
- Your data stays within your Microsoft tenant.
- It respects your existing permissions, if someone doesn’t have access to a file, Copilot can’t use it.
- Nothing you type into Copilot is used to train the public model.
That’s a big difference in a world where GDPR fines and data breaches are still rising year on year.
The Real Question: Where Is Your Data Going?
When choosing between Microsoft 365 Copilot and ChatGPT for Business, the question isn’t just “which is smarter?” but “which is safer for my business data?”
Here’s the breakdown:
| Feature | Microsoft 365 Copilot | ChatGPT for Business |
|---|---|---|
| Integration | Built into Word, Outlook, Excel, Teams | Separate web or app platform |
| Data Privacy | Operates inside your Microsoft tenant | Data processed by OpenAI servers |
| Compliance | Inherits Microsoft 365’s GDPR and ISO certifications | Enterprise plan offers stricter privacy, not default |
| Use Case | Secure document creation, reporting, and summaries | Ideation, writing, creative brainstorming |
| Training Data | Doesn’t learn from your content | May learn from user input (non-enterprise plans) |
How to Use AI Securely in Your SMB
AI tools can be game-changing, but only with a plan in place. SMBs should:
- Define an AI use policy– make clear what data can (and can’t) be shared with AI tools.
- Train staff – help them understand the difference between secure and public tools.
- Review access permissions – Copilot inherits Microsoft 365’s sharing settings, so review who has access to what.
- Monitor activity – track how staff use AI to prevent accidental data exposure.
- Work with your MSP – ensure your AI setup aligns with your cyber and compliance policies.
At Commercial Networks, our Managed IT Services and IT Security teams help clients adopt AI responsibly, protecting productivity and privacy.
Final Thoughts: Choose Smart, Not Just Smart AI
Both Microsoft 365 Copilot and ChatGPT for Business can save SMBs hours every week. The difference lies in what happens to your data behind the scenes.
If your business relies on Microsoft 365 and handles sensitive information, Copilot offers seamless productivity with enterprise-grade protection. ChatGPT still has a place,for creativity, strategy, and innovation but it must be used with clear guardrails.
AI should make your business faster, not riskier.
Contact us today for an AI Readiness Review and find out how to use Copilot and ChatGPT safely, securely, and effectively in your business.
Further Reading
- Microsoft: Copilot Security Overview
- OpenAI: Enterprise Privacy
- NCSC: AI Security Guidance
- ICO: AI and Data Protection Guidance
- Gartner: Generative AI in Business 2025
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