(Updated December 17, 2024)

The concept of Virtual Tenants originated in networking as virtualized environments allowed resources to be segmented into logical divisions. This idea has since evolved to address the needs of cloud services, where organizations often face challenges balancing multi-tenancy with security, governance, and performance.

In traditional multi-tenant SaaS environments, multiple organizations share a single software instance. While cost-effective, this approach can limit customization and security. Single-tenancy, on the other hand, ensures each organization has its own isolated environment, offering stronger security controls and flexibility.

SAP defines single-tenancy as:

“An architecture where each company has their own instance of the software application and supporting infrastructure... By having a single hosted instance, the purchaser can tweak and customize the software to meet their needs.”

This brings us to Microsoft 365 and the limitations of its native single-tenant architecture.

This article covers:

• Microsoft 365 and the Single-Tenant Problem
• Tenant Virtualization in M365: A Better Way Forward?
• CoreView Virtual Tenants for Microsoft 365
• Benefits of CoreView Virtual Tenants

Microsoft 365 and the Single-Tenant Problem

Most organizations using Microsoft 365 operate a single tenant, but complexities arise as they scale or acquire new companies. While combining tenants into a single environment may simplify management and promote collaboration, it creates significant challenges:

1. Complexity: Managing a single tenant with hundreds of thousands of users is cumbersome. Service desks often become overwhelmed, leading to inefficiencies and delayed support.
2. Licensing: License management across vast user bases is inefficient and costly without proper segmentation.
3. Security Risks: The most alarming issue is security. If a single M365 admin’s credentials are compromised, a hacker gains access to the data and settings for every user in the tenant — an enormous risk for organizations with 300,000+ users.

Learn how IT leaders are choosing between a single tenant or multiple tenants in Microsoft 365.

Tenant Virtualization in M365: A Better Way Forward?

Instead of managing an unwieldy monolithic tenant, tenant virtualization offers a smarter alternative. Similar to how VMware virtualizes servers into isolated virtual machines, Microsoft 365 tenants can be logically segmented into smaller, manageable units based on:

• Geography
• Business unit
• Department
• Any other relevant criteria

However, the native Microsoft 365 Admin Center is designed for centralized, single-tenant management. There’s no built-in way to merge or segment tenants post-acquisition, nor can administrators efficiently monitor and manage user accounts across multiple tenants.

This gap creates operational headaches. That’s where CoreView’s Virtual Tenant solution comes in.

CoreView Virtual Tenants for Microsoft 365

CoreView’s Virtual Tenant functionality allows organizations to logically segment their Microsoft 365 environment without altering the underlying tenant architecture.

Here’s how it works:

• Combine and Segment: Merge multiple tenants and create logical groupings — or Virtual Tenants — to reflect departments, regions, or business units.
• Granular Admin Control: Grant administrators access only to their assigned Virtual Tenant, restricting visibility and actions to specific user subsets.
• Streamlined Single Sign-On: Even with distributed or multi-tenant environments, admins can use a single sign-on to manage their assigned Virtual Tenant seamlessly.

This level of segmentation reduces management complexity, strengthens security, and enhances operational efficiency.

Benefits of CoreView Virtual Tenants

Virtual Tenants simplify Microsoft 365 management for large and complex organizations by:

1. Easier Management: IT teams can divide a massive tenant into smaller, manageable units — whether by region, location, or department.
2. Improved Security: Admins are restricted to managing only their assigned Virtual Tenant, minimizing the risk of over-permissioned access.
3. Granular Permissions: With CoreView’s deep Role-Based Access Control (RBAC) capabilities, administrators can perform only specific tasks within their designated group.

“One of my favorite features is the ability to give people access to CoreView and the O365 data, without needing to add them to the O365 tenant as any sort of admin.” -  Senior Business Analyst

By reducing the administrative burden and improving governance, Virtual Tenants enable IT to tackle complex environments piece-by-piece rather than as an overwhelming whole. In fact, organizations using CoreView Virtual Tenants report up to a 90% reduction in ticket escalations.

Ready to learn more?

• See how CoreView Virtual Tenants for Microsoft 365 work.  
• Read about Save the Children using CoreView Virtual Tenants to secure M365 with granular access controls.