Rethinking Managed Services: Why Microsoft 365 Demands a New Approach

How a Platform-First Approach Transforms Security, Compliance, and Value

The rise of Microsoft 365 has reshaped the landscape of IT management, challenging the legacy approaches of traditional Managed Service Providers (MSPs). While MSPs have long been valued for aggregating tools and simplifying operations, today’s platform-centric cloud services like Microsoft 365 demand a radical rethinking of how organizations approach support, security, and strategic IT leadership. If you’re an IT leader, business owner, or MSP client, understanding this shift is critical for making the most of your technology investments.

Traditional MSPs: Masters of the Multi-Vendor Tool Stack

Managed Service Providers were built for a world where IT meant stitching together a patchwork of third-party solutions—backup, mobile device management, email hygiene, firewalls, DLP, and more—into a single, bundled monthly service. The MSP value proposition has centered on convenience: one contract, one help desk, one bill. The catch? This model demands that technicians maintain working knowledge across a dizzying array of vendor products. Microsoft 365, in this context, is often just another item in a crowded toolbox.

While this aggregation approach simplifies procurement, it stretches technical teams thin. Few individuals achieve mastery in every tool, and real expertise is frequently diluted by the need to “know enough” about many solutions. In practice, most MSPs rely on a handful of Microsoft 365 specialists, whose bandwidth and depth may not match the platform’s continuous innovation. This is not a criticism of the technicians themselves, but of a structural reality: a model designed for static, siloed products are ill-suited for the demands of a modern, integrated, and ever-evolving cloud platform.

Microsoft 365: A Unified, Living Platform

Microsoft 365 is not simply a “bolt-on” app; it is a comprehensive cloud operating platform. It unifies identity, applications, devices, security, and compliance under one roof—and is in a constant state of change. Core to its architecture is Microsoft Entra ID (formerly Azure AD), which orchestrates access across Exchange Online, SharePoint, OneDrive, Teams, Intune, Defender, Purview, and more. Each area features detailed role-based access controls and its own admin service.

Microsoft’s cloud model expects organizations to adapt swiftly, with new features and security updates delivered continuously via the Message Center, targeted release rings, and the Microsoft 365 roadmap. Success with Microsoft 365 is not about checking boxes, it’s about keeping pace with rapid change, aligning to prescriptive Zero Trust guidance, and embracing the platform’s native tools for security and management.

Where the Models Clash: Operational and Strategic Mismatches

This is where the traditional MSP model and Microsoft 365’s design diverge—often with significant consequences for operations, security, and ROI. Here’s where the friction surfaces:

- Expertise Spread Too Thin: An MSP juggling seven or more vendor ecosystems cannot remain current with Microsoft’s relentless update cadence. Specialists are overextended, and critical platform features are overlooked or underutilized.
- One-Size-Fits-All Tooling: When Microsoft 365 is treated as a checkbox, opportunities for deep integration, automation, and insight are missed. The risk? Paying twice for third-party tools that duplicate what Microsoft natively offers, while introducing new points of failure.
- Security by Convenience: Pressed for time, MSPs may cling to permanent global admin access or outdated security settings—practices that run counter to Microsoft’s least privilege and Zero Trust principles.
- Licensing Left to Chance: Without in-depth platform knowledge, organizations are frequently assigned default licenses (such as Business Premium) without consideration for advanced auditing, compliance, or Privileged Identity Management (PIM) that higher tiers unlock.

Security and Compliance: Where Gaps Become Risks

Microsoft 365’s rich security model is one of its greatest strengths—and one of the biggest stumbling blocks for traditional MSPs:

- Least Privilege as a Mandate: Microsoft’s best practice is clear: minimize standing global admin rights and use PIM for just-in-time, approval-based access. Persistent “always-on” admin permissions, which are common shortcuts, increase attack surface and violate platform guidance.
- Zero Trust Is a Posture, Not a Product: Achieving a Zero Trust architecture requires ongoing policy tuning, exceptions management, and continuous validation. This is demanding, iterative work—not a “set and forget” deployment.
- Change Management Debt: The rapid pace of Microsoft 365 updates means that organizations must proactively monitor the roadmap, triage Message Center items weekly, and use targeted release channels to validate new features before broad rollout. Without this discipline, production environments are vulnerable to disruptive surprises.
- Licensing as Architecture: The difference between Business Premium, E3, and E5 isn’t just about price—it defines what security and compliance levers are available. Failing to align licensing with business risk means either paying too much for unused features or leaving critical capabilities on the table.
- No Feedback, No Progress: Secure Score is Microsoft’s built-in tool for prioritizing hardening actions. If your operating model doesn’t institutionalize Secure Score reviews and follow-through, security posture will erode over time.

Best Practices: Microsoft’s Blueprint for Platform Mastery

Microsoft prescribes a set of core practices for unlocking the full value and security of its platform:

- Domain Ownership, Not Ticket Chasing: Organize IT around platform domains—identity, email/collaboration, endpoint, security, and compliance. Assign domain leads who own health, KPIs, and incoming changes from the Message Center.
- Least Privilege by Design: Eliminate standing global admin access in favor of PIM and granular, workload-specific roles. Use scope tags in Intune to segregate duties by business unit or geography.
- Iterative Zero Trust Adoption: Start with Microsoft’s identity and device policy sets—MFA, conditional access, app protection, device compliance—and model impact with “report only” before enforcing. Evolve into specialized security tiers for sensitive roles and data.
- Structured Change Management: Adopt targeted release for IT power users and standard release for everyone else. Triage Message Center updates weekly, assign owners, and set due dates for action. Use the Microsoft 365 roadmap as a planning tool for communications and training.
- Licensing as an Ongoing Design Decision: Map business risk and compliance needs to licensing features, revisiting annually as Microsoft adds new entitlements.
- Measure and Improve: Maintain a Secure Score backlog with assigned actions, owners, and expected improvements. Review progress monthly in a security governance forum.

A Platform-Centric Operating Model: The Way Forward

The answer is not to abandon managed services, but to evolve them. Progressive organizations and specialist partners are adopting a platform-first mindset, building operational models that align to the realities of Microsoft 365:

- Engage with specialists who focus only on Microsoft 365—not a dozen other vendor UIs.
- Operate with domain leads, documented roles, and structured practices for change, not just shared global admins.
- Integrate Zero Trust, PIM, and Secure Score sprints into regular operations.
- Supplement internal teams with fractional experts when needed, while training staff in parallel to bring capabilities in-house over time.
- Treat licensing as a strategic lever, not just a procurement checkbox.

This approach is not just more secure—it delivers greater ROI and operational agility, letting you keep pace with Microsoft’s rapid innovation.

Checklist: Evaluating Your Current MSP and Microsoft 365 Approach

Ask yourself:

- Do we have zero standing global admins (except break-glass accounts) and use PIM for elevation?
- Are our conditional access policies aligned with Microsoft’s baseline and reviewed quarterly?
- Are Intune admin roles scoped with tags, avoiding tenant-wide permissions?
- Do we triage the Message Center and use targeted release for new features before broad rollout?
- Is our Secure Score trending up, with assigned owners and tracked actions?
- Does our licensing map to actual security and compliance needs (e.g., Entra P2, PIM, E5 for advanced features)?

Conclusion: Platform-First Is the Future

The world has changed. Microsoft 365 is a platform, not a product—a living, integrated system that rewards those who embrace its full capabilities. The traditional MSP model, rooted in multi-vendor aggregation and ticket-based support, cannot deliver the depth, agility, or security that today’s businesses require. Whether you build these capabilities in-house, partner with a specialist, or pursue a hybrid approach, the imperative is clear: align your people, processes, and partners to the architecture and pace of Microsoft 365. Every aligned investment compounds your business value.

Ready to break free from outdated models and harness Microsoft 365 the way it was meant to be used? Seek out platform specialists, demand best practices, and make your cloud investments work for you—not against you.