How can teams reduce Office 365 identity sprawl without disrupting users?

Use agentless discovery and correlate the results across Exchange, SharePoint, OneDrive and Teams before changing anything. That gives teams enough context to separate legitimate collaboration access from stale or risky identities, which reduces the chance of breaking business workflows while cleaning up the tenant.

Why This Matters for Security Teams

Office 365 identity sprawl is rarely a cosmetic issue. It usually means stale guests, over-permissioned service identities, shared mailboxes, and orphaned collaboration access have accumulated faster than governance can track them. When teams try to “clean up” without full context, they risk breaking Exchange workflows, SharePoint sharing, OneDrive handoffs, or Teams collaboration that still supports real work. Current guidance from NIST Cybersecurity Framework 2.0 emphasizes asset and access visibility first, not blind remediation.

The scale problem matters because NHIs already outnumber human identities in many environments, and NHIMG notes that only 5.7% of organisations have full visibility into their service accounts in the Ultimate Guide to NHIs. That same visibility gap is what turns Microsoft 365 cleanup into a production risk instead of a governance exercise. In practice, many security teams encounter broken collaboration only after a well-meaning access review has already removed something critical.

How It Works in Practice

The safest approach is to treat Office 365 cleanup as a discovery and correlation problem before it becomes an access-change problem. Teams should first inventory identities and permissions across Exchange, SharePoint, OneDrive, and Teams, then correlate who is actually using what, how recently, and in what context. That means separating legitimate collaboration access from stale external guests, dormant accounts, inherited group memberships, and identities created for automation. This is especially important because collaboration systems often hide access paths behind groups, shared links, and nested permissions.

Agentless discovery is useful here because it reduces deployment friction and avoids introducing new administrative overhead into an already sensitive tenant. Best practice is evolving toward combining tenant-wide visibility with policy checks from frameworks like NIST CSF and identity lifecycle guidance from Ultimate Guide to NHIs — Key Challenges and Risks. The operational sequence usually looks like this:

• Map all identities, guests, shared resources, and app-linked accounts before touching permissions.
• Rank access by recent activity, privilege level, and business owner confirmation.
• Test removals in small batches, starting with clearly stale identities and unused sharing links.
• Preserve exceptions for regulated workflows, automation, and cross-team collaboration.
• Document rollback steps so access can be restored quickly if a dependency was missed.

This process works best when business owners validate high-risk removals and when identity data is normalized across the tenant. These controls tend to break down when permissions are heavily inherited through legacy SharePoint structures or when Teams and OneDrive sharing is unmanaged across multiple tenant boundaries.

Common Variations and Edge Cases

Tighter cleanup often increases operational overhead, requiring organisations to balance reduced sprawl against the time needed to validate legitimate access. That tradeoff is real in Microsoft 365 because not every “extra” identity is a problem. Some are intentionally temporary, such as guest collaborators, project-based access, migration accounts, or automation identities tied to reporting and security tooling.

There is no universal standard for every tenant pattern, so current guidance suggests treating edge cases differently from routine cleanup. For example, executive assistants, legal hold workflows, and external vendor collaboration may require exceptions that should be documented rather than eliminated. The same is true for service identities used by connectors, DLP tools, or ticketing integrations. NHI guidance from the 52 NHI Breaches Analysis shows that identity-related incidents often start with overlooked access paths, not dramatic compromise events.

Teams should also avoid treating “inactive” as automatically “safe to delete.” In Office 365, inactivity can reflect seasonal work, delegated ownership, or shared-resource patterns rather than abandonment. The practical goal is to reduce unnecessary standing access while preserving the collaboration paths the business still uses.

Related resources from NHI Mgmt Group

• How should IAM teams respond when Office 365 identity sprawl spans human and non-human access?
• How should security teams reduce vault sprawl without disrupting delivery?
• How can teams reduce identity sprawl without losing operational speed?
• How should security teams reduce IAM sprawl without disrupting operations?