The definitive guide to Azure AD: Everything you need to know

Cloud technology has significantly changed the way organisations operate. Offering new ways to conduct business, interact with customers, and manage your internal IT systems and employees.

Microsoft’s Azure platform is one of the heavy hitters operating in the Cloud arena. And it’s only getting bigger, hitting over 425 million daily users in 2021 (Microsoft FY21 Q2 Results).

This growth is largely powered by the Active Directory component at the heart of Azure. Azure Active Directory (Azure AD) provides an ever-expanding array of features and functionality for the management of identities and security.

But what exactly is Azure AD? What does it provide? How does it function? You’ll find these answers and much more below as we give you everything you need to know about Azure AD.

What is Azure AD?

Azure Active Directory is Microsoft’s multi-tenant, cloud-based identity and access management service. It’s the digital infrastructure that allows your employees to sign in and access external resources held in Office 365 and an ever-growing list of other SaaS applications, as well as those held on a corporate network or intranet.

Azure AD’s strength lies in the flexibility afforded to it by being entirely cloud-based. This means that it can either act as an organisation’s only directory, or it can sync with an on-premises directory via Azure AD Connect.

Either way, it enables both on-premises and cloud-based users to access the same apps and resources, simultaneously benefitting from features such as single sign-on (SSO), multi-factor authentication (MFA), conditional access, and more.

More importantly, it provides a single place from which to manage your identity, security, and compliance controls across your entire IT estate.

What does Azure AD do?

Azure AD provides different benefits depending on what you’re using it for.

For IT admins, it allows complete control over access to applications and resources utilising security controls like MFA and conditional access. They can also use Azure AD’s built-in governance controls to apply automated lifecycle management and privileged access limitations.

In addition to this, Azure AD also provides admins with the ability to automate provisioning between Windows Server Active Directory and cloud apps like Office 365.

For developers, Azure AD can be used as a standards-based approach to enabling features like SSO and for personalising the app experiences using existing organisation data through APIs.

If you’re a user or employee, Azure AD means quick and easy access to work resources, on a multitude of devices, from almost anywhere on the planet.

How does it work?

Azure AD, as the name suggests, is a directory – a container for your user names, credentials, and access rights (typically to information-based resources).

Cloud-only or hybrid

Azure AD can be operated in ‘cloud-only’ mode, allowing your users to sign in to their Windows PCs using the cloud directory service. Alternatively, if you, like many organisations, are still tied to on-premises legacy infrastructure, Azure AD can use your local Active Directory as a master for account data and operate in a variety of hybrid modes.

Threat detection

Whether in cloud-only or hybrid mode, Azure AD effectively acts as your ‘front door’ for sign-ins. A key benefit of doing so allows you to take advantage of state-of-the-art security measures, such as assessing the threat level of the user attempting access and being able to mitigate that threat – for example, requesting two-factor authentication.

Single sign-on compatibility

One of the most attractive advantages of using Azure AD is its ability to enable single sign-on (SSO) and it supports third-party application integration to help achieve this.

Applications can connect using standard ‘modern auth’ protocols – SAML or OpenID Connect. Application and group assignments (including dynamic groups) in Azure AD determine who has access to what.

Single sign-on means that users will be able to access all of the applications they need by signing in only once using a single user account hosted in Azure AD. Once signed in, they can access those applications without being required to authenticate a second time.

Azure AD has been designed to enable easy integration with many of today’s popular SaaS applications, enabling users to either single sign on to applications directly or discover and launch them from a portal, such as Office 365 or the Azure AD access panel.

What are the benefits of using Azure AD?

Azure AD offers a plethora of incentives for adoption, hence why it’s used by 95% of the Fortune500.

Again, this is driven by its incredible flexibility. Whilst Azure AD is optimised for Microsoft applications, it is also highly compatible with apps developed outside the house that Bill built.

This open standards approach has allowed Azure AD to become the core mechanism by which an organisation can manage all of its different apps, devices, and users across multiple tenants.

Azure AD’s key benefits largely fall into five categories:

1. One place for identity and access management

Azure AD is the heart of your organisation’s IT, giving you one place to go for managing user identities and permissions. You can assign users to groups individually or using rules driven by attributes, and you can use groups to assign licences and application access. You have all the control in one place.

2. One identity for all applications

Whilst your users’ Azure AD identities are perfect for signing into Microsoft applications, it is also highly compatible with apps developed elsewhere. Millions of users use Azure AD to regularly access third-party party applications on a daily basis, streamlining the process and increasing productivity.

3. Security

Organisations want to protect their resources from malicious or accidental harm – and to protect their users from identity theft. Azure AD achieves these aims with a range of measures, including threat detection, conditional access, multi-factor authentication, privileged identity management (PIM), and more.

4. Ease of use

Getting access to resources should be easy for end-users. Single sign-on, using the same sign in for Windows and all your applications, means less fuss with credentials, and fewer demands on the IT help desk.

5. Collaboration

Azure AD allows you to invite external (guest) users into your directory to assign access, while their credentials are managed by their organisation’s IT department.

This gives you immediate and easy collaboration options while not having to worry about user lifecycle.

Azure AD key features

Having all of your disparate environments united under Azure AD offers some significant functionality options and features:

Key takeaways

Next steps