Hi Justin,
The fact that you are not seeing the "Set up for work or school" option and are being taken directly to the "Let's add your Microsoft account" screen almost certainly means this Surface laptop has Windows Home edition installed (e.g., Windows 11 Home).
Windows Home editions are designed for personal use and do not include the feature to directly join a company's Azure AD (Entra ID) domain during the setup (OOBE). They only permit the use of a personal Microsoft Account, which is why it's rejecting your work account (as it sees it as the "wrong type of account" for this process).
To set up the computer with a business Office 365 account, your device needs to be running Windows Pro, Enterprise, or Education edition.
Recommended Solution:
1. Stop the current setup process.
2. Contact your company's IT department. Let them know that the new Surface device is running Windows Home and you are unable to set it up with your company account.
- Your IT department will need to upgrade the machine's operating system from Windows Home to Windows Pro. They will have a license (product key) or a standard procedure (like reinstalling with a company Windows Pro image) to do this.
After the device is upgraded to Windows Pro, you can restart the setup process. You will then definitely see the "How would you like to set up this device?" screen and be able to select "Set up for work or school" as I originally mentioned.
The workaround you mentioned (creating a personal Microsoft account to get inside) will not join the device to your company's Azure AD domain correctly (it will only be "registered" instead of "joined") and will likely not comply with your company's security and management policies.
I know this is an extra complication, but upgrading to Windows Pro is the only way to resolve this correctly.
And if this answer helps, feel free to hit “Accept Answer” so others can benefit too 😊