SC-300: Microsoft Identity & Access Management Certification

Implementing an Identity Management Solution

Identity management is a foundational component of any modern IT infrastructure. In the context of Microsoft technologies, Azure Active Directory (Azure AD) provides a robust platform for managing user identities, controlling access, and ensuring security across cloud and hybrid environments. This part will explore how to implement an identity management solution using Azure AD and its connected technologies. It covers initial configurations, the creation and management of identities, handling external identities, and setting up hybrid identity solutions.

Initial Configuration of Azure AD

Before deploying an identity management solution, the initial configuration of Azure AD must be completed properly. Azure AD is Microsoft’s cloud-based identity and access management service, and it enables users to access external resources like Microsoft 365, the Azure portal, and thousands of other SaaS applications. It also allows access to internal resources such as apps on a corporate intranet and any cloud apps developed within the organization.

The first step involves setting up a tenant in Azure AD. A tenant represents an organization and is a dedicated instance of Azure AD that an organization receives when it signs up for a Microsoft cloud service such as Microsoft 365 or Azure. Once the tenant is created, the global administrator account has the highest level of permissions and can begin the configuration process.

Proper domain configuration is also vital. Organizations typically add their custom domain names to Azure AD and verify ownership. This step helps align the user identity with the organization’s domain, which enhances trust and security. In addition, administrators should review and set up required company branding and security defaults to ensure that the directory reflects the organization’s identity and security policies.

Another important step in the initial setup is defining administrative roles and delegating access appropriately. Azure AD provides a range of built-in roles such as User Administrator, Application Administrator, and Security Reader. Assigning these roles based on least privilege principles ensures that users have only the permissions necessary to perform their tasks.

Creating, Configuring, and Managing Identities

Identity creation is the process of establishing user accounts in Azure AD. These identities represent employees, partners, or other entities that need access to organizational resources. Azure AD allows identity creation through manual entry in the portal, bulk import using CSV files, or automated creation through integration with on-premises Active Directory using Azure AD Connect.

Once identities are created, configuration involves setting attributes such as job title, department, office location, and more. Administrators can also assign users to groups, roles, and licenses. Azure AD supports dynamic groups, which automatically add or remove users based on defined rules. For example, a dynamic group could be set up to include all users in a specific department.

Managing identities over time includes handling user lifecycle events such as onboarding, updating user attributes, and deactivating accounts when users leave the organization. Azure AD offers tools like access reviews and lifecycle workflows to automate these processes and reduce administrative overhead.

To maintain a secure and compliant environment, identity management must include password policies, account lockout settings, and user risk policies. These measures help prevent unauthorized access and ensure that user accounts remain secure.

Implementing and Managing External Identities

Modern organizations often work with partners, contractors, or customers who require access to specific resources. Azure AD enables secure collaboration through external identities, which allow users outside the organization to access applications and resources while maintaining control and governance.

Azure AD B2B (Business-to-Business) collaboration provides a mechanism to invite external users to the directory. Invited users can use their credentials to sign in, and their access is governed by the same policies that apply to internal users. This model reduces the complexity of managing external accounts while enhancing security and user experience.

The invitation process can be automated through APIs or portals and can include custom messaging and branding. Once an external user accepts the invitation, administrators can assign them to groups, roles, or resources. Conditional Access policies, multi-factor authentication, and identity protection features are all available to external identities, providing a consistent and secure approach.

Managing external identities also involves monitoring and reviewing access. Azure AD provides tools to view external user activity, revoke access when necessary, and run reports on guest usage. These capabilities help ensure that collaboration is conducted securely and that access is granted only as needed.

Implementing and Managing Hybrid Identity

Many organizations operate in a hybrid environment, where some resources are hosted on-premises while others reside in the cloud. A hybrid identity allows users to access both on-premises and cloud-based resources using a single identity. Azure AD Connect is the key component that enables hybrid identity by synchronizing on-premises Active Directory objects to Azure AD.

There are three main hybrid identity models: password hash synchronization, pass-through authentication, and federation with Active Directory Federation Services (AD FS). Each model has different use cases, benefits, and limitations.

Password hash synchronization is the simplest model. It syncs password hashes from on-premises AD to Azure AD, allowing users to sign in using the same password for both environments. This model is easy to set up and meets most organizational needs.

Pass-through authentication provides an added layer of security by allowing users to authenticate against the on-premises directory directly. In this model, passwords are not stored in the cloud, and authentication requests are passed through to the local Active Directory.

Federation with AD FS is suitable for organizations with complex requirements, such as smart card authentication or custom login experiences. AD FS allows complete control over the authentication process but requires more infrastructure and maintenance.

Azure AD Connect also supports writeback features like password writeback and group writeback, which enable changes in Azure AD to reflect in on-premises Active Directory. This bi-directional sync is useful for scenarios like self-service password reset and hybrid Exchange deployments.

Properly configuring synchronization rules, ensuring high availability, and regularly monitoring synchronization health are essential tasks in hybrid identity management. Azure AD Connect Health provides monitoring and reporting capabilities to help administrators detect and resolve issues promptly.

A well-implemented hybrid identity strategy allows organizations to transition to the cloud at their own pace, maintain compatibility with existing systems, and provide a seamless user experience across environments. It supports secure collaboration, enhances productivity, and lays the groundwork for advanced identity protection and governance features available in Azure AD.

Implementing Authentication and Access Management

After establishing identities and directory structures, the next step is to ensure those identities are authenticated securely and granted appropriate access. Azure AD provides several features and tools to manage authentication methods, enforce access control policies, and protect identities from compromise.

Implementing and Managing Authentication

Authentication verifies the identity of a user or system before granting access to resources. Azure AD supports multiple authentication methods, allowing organizations to balance usability and security. These include:

• Password-based authentication

• Multi-Factor Authentication (MFA)

• Windows Hello for Business

• FIDO2 security keys

• Certificate-based authentication

Implementing MFA is one of the most effective security practices. It requires users to present two or more verification factors, significantly reducing the risk of unauthorized access from compromised passwords. Azure AD supports MFA via text messages, phone calls, mobile app notifications, or biometrics.

Administrators can configure user settings and policies to define which authentication methods are allowed and under what circumstances. For example, MFA can be required only when users sign in from unfamiliar locations or devices. Organizations can use the Azure AD Authentication Methods policy to manage the availability of methods across the tenant.

Self-service password reset (SSPR) is another key feature, allowing users to reset their passwords without contacting the help desk. SSPR reduces IT support costs and improves the user experience. Administrators can configure registration requirements and define security questions or additional methods for identity verification.

Implementing Conditional Access Policies

Conditional Access (CA) is a policy-based approach to enforce access control decisions. It evaluates signals such as user location, device compliance, risk level, and app sensitivity to determine whether to allow, block, or require additional authentication.

Conditional Access is a critical security capability in Azure AD, used to enforce Zero Trust principles. A Zero Trust model assumes breach and verifies explicitly — meaning access is never granted implicitly and always requires verification.

Policies can be configured to:

• Require MFA for high-risk sign-ins

• Block access from specific countries or locations

• Require compliant or hybrid-joined devices

• Enforce app-based restrictions (e.g., browser-only access)

Each Conditional Access policy is built using “if-then” logic — if a user meets certain criteria, then apply a specific access control. For example: If a user signs in from an untrusted location, then require MFA.

Testing policies in report-only mode allows administrators to assess the impact of CA rules before enforcement, helping avoid disruptions. Logs and insights from the Conditional Access dashboard provide visibility into policy effectiveness and potential security gaps.

Configuring Azure AD Roles and Privileged Identity Management

Azure AD uses role-based access control (RBAC) to manage who has access to what. Assigning roles allows organizations to follow the principle of least privilege, ensuring users have the minimum access needed to perform their job functions.

Azure AD includes dozens of built-in roles, such as:

• Global Administrator

• User Administrator

• Security Administrator

• Intune Administrator

Roles can be assigned at the tenant or resource level, and custom roles can be created to fit unique requirements. Admins can use Administrative Units to delegate specific roles to subsets of users, such as region-specific administrators.

To manage elevated permissions securely, Azure AD offers Privileged Identity Management (PIM). PIM provides just-in-time (JIT) role activation, approval workflows, and access review capabilities for privileged roles.

With PIM, administrators can:

• Assign roles as “eligible” rather than permanent

• Require MFA for activation

• Enforce justification and ticketing

• Set activation time limits

• Audit and review role usage

PIM ensures that privileged access is controlled, time-bound, and fully auditable — a critical aspect of compliance and internal security policies.

Monitoring Identity and Access with Azure AD Tools

Ongoing monitoring and auditing are essential to maintaining a secure identity infrastructure. Azure AD provides a range of tools and reports to help track user activity, detect suspicious behavior, and enforce compliance.

Key monitoring features include:

• Sign-in logs: Show who signed in, from where, using what device, and whether the sign-in was successful.

• Audit logs: Track changes to users, groups, apps, and policies.

• Workbooks and dashboards: Visualize security trends and identify anomalies.

Azure AD also integrates with Microsoft Sentinel and Microsoft Defender for Identity to provide advanced analytics, alerting, and automated response capabilities. These tools help identify threats such as:

• Unusual sign-in patterns

• Impossible travel (sign-ins from two distant locations in a short time)

• Privilege escalation attempts

• Credential stuffing attacks

Alerts and recommendations from Microsoft Entra ID Protection (formerly Azure AD Identity Protection) help detect identity risks and take action based on risk policies.

Implementing Identity Governance

Identity governance ensures that the right people have the right access to the right resources—and only for the right amount of time. It helps organizations meet compliance requirements, reduce insider risks, and streamline user lifecycle management. Azure AD offers powerful identity governance tools such as entitlement management, access reviews, and lifecycle workflows.

Implementing Access Reviews

Access reviews help administrators and resource owners review and validate user access to applications, groups, and roles regularly. This is especially important for ensuring that users do not retain unnecessary privileges over time, which could introduce security or compliance risks.

Azure AD access reviews allow organizations to:

• Automate periodic reviews of user access to Microsoft 365 groups, Azure AD roles, and enterprise applications.

• Require decisions from group owners, managers, or specific reviewers.

• Automatically remove access if users fail to justify continued need.

• Generate audit logs for internal review or compliance reporting.

Access reviews are essential in organizations where access privileges must be reviewed periodically due to regulations like GDPR, HIPAA, or SOX. Reviews can be targeted at guest users, users in high-privilege roles, or users with access to sensitive apps.

Managing Entitlement Management

Entitlement management in Azure AD streamlines the process of onboarding and offboarding users by defining access packages that group resources like groups, apps, and SharePoint sites.

With entitlement management, organizations can:

• Define access packages for specific roles (e.g., contractor, vendor, new hire).

• Automate the request and approval workflows for access.

• Set up expiration policies and require access re-justification.

• Support external users through connected organizations.

Users can request access to packages via a customizable portal. Upon approval, they are automatically granted access to all associated resources. When access expires or is revoked, all entitlements are removed at once—reducing administrative overhead and increasing security.

This approach helps avoid over-provisioning and ensures users get only what they need, for only as long as they need it.

Implementing Lifecycle Workflows

Effective identity lifecycle management is critical to ensuring that users have the appropriate access at every stage of their time with an organization. From onboarding new hires to managing internal transfers and securely deactivating accounts when users leave, each stage of the user journey must be governed with precision and consistency.

Azure Active Directory (Azure AD), through Microsoft Entra ID Governance, provides robust capabilities for automating and managing these lifecycle events through Lifecycle Workflows. These workflows eliminate the need for manual interventions, reduce human error, ensure compliance, and enhance the overall security posture of the organization.

Automating Identity Lifecycle Events

Lifecycle workflows are designed to automate the repetitive, policy-driven tasks associated with identity management. They are particularly beneficial in environments where users frequently join, move within, or leave the organization—such as enterprises with dynamic staffing needs, global operations, or heavy reliance on contingent workers.

Organizations can define workflows for a wide range of events, including:

User account creation: When a new employee is hired, a workflow can automatically provision their account, assign the appropriate Microsoft 365 or Azure AD licenses, and enroll them in the relevant groups and applications based on their role or department.

Role or department changes: When a user moves to a new team or takes on a different role, the workflow can automatically update their group memberships, access permissions, and assigned applications to reflect the change, while also removing access that is no longer relevant.

Termination or leave of absence: When a user leaves the organization, a workflow can disable the user account, revoke access tokens, remove the user from all groups, deallocate licenses, and archive their data or forward their email. For leaves of absence, access can be paused temporarily and reactivated upon return.

Common Workflow Actions

Lifecycle Workflows in Azure AD are highly customizable, allowing organizations to configure a series of automated actions to meet their specific operational and compliance needs. Common examples of workflow actions include:

• Sending welcome or onboarding emails with instructions and useful links

• Adding users to security or Microsoft 365 groups based on role or department

• Assigning licenses for tools like Microsoft 365, Teams, SharePoint, or third-party SaaS apps

• Starting access reviews to validate user permissions periodically

• Setting expiration dates for guest or contractor accounts

• Disabling user accounts upon departure or after inactivity

• Triggering external systems using APIs or Power Automate flows

These actions can be sequenced and timed, such as sending a welcome email immediately, provisioning licenses after a delay, or starting a review after 30 days. This level of orchestration ensures that the entire identity lifecycle is consistent and policy-compliant.

Use of Attributes and Conditions

Workflows can use user attributes like job title, department, country, or employee type to make decisions. For example, a workflow might assign different licenses or group memberships to full-time employees than it does to contractors. Conditions can also include whether the user is internal or external, their manager’s name, or the date of hire.

This attribute-based control enables organizations to implement dynamic and scalable workflows that adapt automatically to user context, reducing administrative overhead.

Integration with HR Systems

Azure AD supports integration with Human Resources (HR) systems using SCIM (System for Cross-domain Identity Management) or custom APIs. This allows identity provisioning and updates to be triggered automatically based on changes in the HR system, such as when a user is hired, promoted, or terminated.

HR-driven provisioning ensures that the identity lifecycle begins with accurate, authoritative data. It minimizes latency between HR actions and IT responses, reduces manual data entry, and maintains a single source of truth. Microsoft also supports out-of-the-box connectors for popular HR systems like Workday, SAP SuccessFactors, and Oracle HCM.

With these integrations, a new user can be fully provisioned in Azure AD—including account, licenses, access, and communication—before they even start work. Similarly, deprovisioning can be triggered immediately upon termination to prevent unauthorized access.

Compliance and Governance Benefits

Automating identity lifecycle tasks is not only an efficiency booster—it is essential for regulatory compliance and security. Standards like ISO 27001, NIST, GDPR, HIPAA, and SOX require organizations to enforce consistent controls over user access, particularly for sensitive data and systems.

Manual onboarding and offboarding processes often result in access creep, where users accumulate more access than necessary, or orphaned accounts, where users who have left still have valid credentials. These are serious security risks and common audit findings.

Lifecycle Workflows reduce these risks by ensuring that:

• Access is granted only when required, and always based on policy.

• Access is reviewed regularly and removed when no longer justified.

• Departing users are promptly deactivated and cleaned from the directory.

• All changes are logged and auditable, supporting transparency and accountability.

Additionally, Lifecycle Workflows support delegated administration. For example, HR managers can be given visibility or limited control over certain workflow processes without needing full IT permissions, improving collaboration across departments.

Extending Workflows with Power Automate and Custom APIs

While Azure AD provides powerful built-in workflow actions, organizations often need to extend functionality to cover broader use cases. This can be done by integrating Power Automate, which allows workflows to interact with external systems such as ticketing platforms, identity governance platforms, asset management tools, and communication services.

For example, when a user is offboarded:

• A Power Automate flow can open a ServiceNow ticket to recover the user’s laptop.

• A message can be sent to the IT team’s Microsoft Teams channel.

• The user’s OneDrive data can be backed up to a SharePoint archive.

Custom APIs can also be invoked during workflows to perform domain-specific tasks such as revoking third-party app tokens, removing VPN profiles, or initiating legal hold procedures.

This extensibility makes Azure AD Lifecycle Workflows suitable not only for IT provisioning but also for broader organizational processes that require coordination across HR, security, legal, and compliance functions.

Reporting and Monitoring Workflow Execution

Administrators can monitor workflow execution through detailed logs and dashboards in the Microsoft Entra portal. These reports show which workflows have run, what actions were taken, and whether they succeeded or failed. Alerts can be configured for failed workflows, helping IT teams respond proactively.

Additionally, usage and compliance metrics can be exported for internal analysis or external audits. This visibility ensures that identity lifecycle processes are not only automated, but also measurable, traceable, and accountable.

Future Directions and AI Integration

Microsoft continues to enhance Lifecycle Workflows with AI-powered capabilities and deeper integrations across the Microsoft ecosystem. For example, future developments may include:

• Predictive identity provisioning based on organizational patterns

• Automated access recommendations based on usage data

• Chatbot-guided workflows through Teams

• Integration with Microsoft Copilot for workflow management and status queries

These advancements will make identity lifecycle management even more intuitive, intelligent, and aligned with modern workplace expectations.

Implementing Lifecycle Workflows in Azure AD transforms how organizations manage user identities. By automating onboarding, role transitions, and offboarding, these workflows reduce manual workload, increase consistency, improve security, and ensure compliance with regulatory standards.

Whether integrated with HR systems or extended via Power Automate, Lifecycle Workflows provide a comprehensive foundation for modern identity governance. As organizations continue to evolve toward hybrid and cloud-first environments, automated lifecycle management is not just a convenience—it’s a necessity.

Monitoring and Reporting Identity Governance

Azure AD provides robust monitoring and reporting tools to support governance efforts. Administrators can use:

• Governance dashboards for a quick view of access reviews, entitlement requests, and lifecycle activities.

• Audit logs to track changes and actions taken.

• Access insights to identify unused access or over-privileged accounts.

• Downloadable reports to share with auditors or compliance teams.

Integrating governance data into Microsoft Sentinel or third-party SIEM solutions allows for more advanced analytics and threat detection.

Regular reporting helps prove compliance with regulations and ensures that identity governance processes are being followed effectively.

Securing Identities and Access

With identities and governance processes in place, maintaining continuous security becomes critical. Azure AD, through Microsoft Entra, offers powerful capabilities to detect threats, block unauthorized access, and improve the overall security posture of your identity infrastructure. This section focuses on identity threat detection, integration with broader security tools, and best practices.

Implementing Microsoft Entra ID Protection

Microsoft Entra ID Protection (previously Azure AD Identity Protection) uses AI-driven risk detection to identify suspicious activity related to sign-ins and user behavior. It calculates two types of risk: sign-in risk and user risk. Sign-in risk indicates whether a specific sign-in attempt might be unauthorized, such as one coming from a location known for malicious activity. User risk refers to the likelihood that the user’s credentials have been compromised.

Administrators can configure policies that automatically respond to these risks. For instance, if a high-risk sign-in is detected, the policy can require the user to complete multi-factor authentication. If a user is deemed high risk, their account can be automatically forced to reset the password or even be blocked entirely. These policies can also be integrated with Conditional Access to enforce real-time decisions at the point of login.

Integrating with Microsoft Defender and Sentinel

For deeper threat protection and investigation, Microsoft Entra integrates with Defender for Identity and Microsoft Sentinel. Defender for Identity helps detect advanced threats like lateral movement, privilege escalation, and credential theft in hybrid environments that include on-premises Active Directory. Microsoft Sentinel acts as a centralized cloud-based SIEM (Security Information and Event Management) platform, bringing together logs and telemetry from across Microsoft services.

By combining Entra ID Protection with Defender and Sentinel, security teams can correlate identity-based threats with signals from endpoints, cloud apps, and the network. This integration supports real-time alerting, automated response actions, and unified investigations.

Configuring Identity Secure Score and Recommendations

Secure Score, found within the Microsoft Entra portal, gives a numerical representation of your organization’s identity security posture. The higher the score, the better your configurations align with recommended security practices.

Administrators can review detailed improvement actions, such as enforcing MFA, restricting access to sensitive applications, or removing deprecated authentication methods. Secure Score also tracks historical trends so you can measure progress over time and identify areas where security posture may have weakened.

Following Identity and Access Best Practices

To protect identities consistently, several operational best practices should be adopted across authentication, role management, lifecycle governance, and monitoring.

From an authentication and access standpoint, multi-factor authentication should be mandatory for all users, especially administrators. Legacy authentication protocols such as POP or IMAP, which don’t support MFA, should be disabled. Conditional Access policies should be applied to control access based on user risk, location, device compliance, or application sensitivity. These policies should align with a Zero Trust approach, where all access is explicitly verified.

For privilege management, roles must follow the principle of least privilege. Privileged Identity Management should be enabled for all elevated roles, ensuring access is temporary, audited, and requires approval. Role assignments should be regularly audited to avoid permission creep.

In terms of lifecycle and governance, user onboarding, transitions, and offboarding should be handled via automated workflows. This ensures consistency and reduces the risk of human error. Access reviews must be performed regularly, particularly for guest users and those with access to sensitive data. Entitlement management can be used to centralize and control access requests.

On the monitoring side, administrators should routinely review sign-in logs and audit logs to detect anomalies such as unusual login patterns or changes to role assignments. Secure Score should be checked frequently, and the most impactful recommendations should be prioritized. If possible, integration with Sentinel or another SIEM tool should be used for real-time detection and alerting.

Summary

This final section focuses on how to secure, monitor, and continuously improve identity management using Microsoft Entra and related tools. Microsoft Entra ID Protection adds intelligent risk-based access decisions. Defender for Identity and Microsoft Sentinel provide advanced analytics and threat hunting capabilities. Secure Score helps assess and optimize your identity configuration. Finally, following operational best practices ensures that your organization maintains a strong security posture while enabling productivity.