Microsoft 365 is the backbone of modern work, but with power comes responsibility. From Teams to SharePoint to Copilot, every layer of Microsoft 365 needs to meet increasing compliance demands, whether you’re dealing with GDPR, HIPAA, or industry-specific regulations.
At Reality Tech, we work with IT leaders and compliance managers across regulated industries to ensure their Microsoft 365 environments stay secure, auditable, and future-ready.
Let’s unpack the Top 5 Microsoft 365 compliance challenges our clients face and how we help solve them.
1. Unclear Data Residency and Storage Locations
Microsoft 365’s distributed infrastructure makes it difficult to pinpoint exactly where sensitive data is stored, which becomes a problem when regulations require data to remain within specific national or regional borders.
Key Risks:
- Violation of local data protection laws
- Inability to prove residency during audits
- Risk of fines or operational disruptions
Reality Tech’s Solution:
- Configure multi-geo tenants to align with regional requirements
- Use the Microsoft Compliance Purview solution to define and control data movement
- Provide documentation and visibility needed for regulatory audits
2. Lack of Visibility into Shadow IT and Connected Apps
Employees connect personal apps and third-party integrations to Microsoft 365 every day, often without realizing the security or compliance implications.
Key Risks:
- Data leakage through unsanctioned apps
- Bypassed DLP or governance controls
- Compliance violations due to unauthorized tools
Reality Tech’s Solution:
- Deploy Microsoft Defender for Cloud Apps to discover shadow IT
- Set up approval workflows and App Governance policies
- Build safe app ecosystems without restricting productivity
3. Inconsistent or Missing Data Classification
Without proper classification and labeling, organizations can’t protect sensitive data or even prove they know where it is. Many businesses overlook this foundational step.
Key Risks:
- Exposing sensitive data in SharePoint or Teams
- Weak data loss prevention
- Failing audits due to a lack of documentation
Reality Tech’s Solution:
- Implement Microsoft Purview Sensitivity Labels
- Auto-classify content using machine learning policies
- Build clear rules for retention, access, and sharing across departments
4. Low Compliance Awareness Across Teams
Even with policies in place, compliance only works if your teams follow it. Many organizations lack the tools and training to enforce compliance behaviors.
Key Risks:
- Unintentional data sharing or leakage
- Incomplete audit trails
- Poor Microsoft Compliance Scores
Reality Tech’s Solution:
- Configure the Microsoft Compliance Center Dashboard for real-time posture tracking
- Set up user-specific policies that adapt by role and risk level
- Deliver training sessions and policy rollouts integrated with Microsoft 365
5. AI-Driven Risks with Microsoft Copilot
Microsoft 365 Copilot introduces new challenges like exposing sensitive information through AI-generated content. Few organizations are prepared to govern Copilot usage from a compliance lens.
Key Risks:
- Confidential data surfaced in Copilot suggestions
- Copilot generating content based on protected files
- Lack of governance policies for AI interactions
Reality Tech’s Solution:
- Assess your Copilot AI-readiness with our Governance & Access Review
- Define Copilot-aware DLP policies
- Use eDiscovery and Audit Logging to track Copilot interactions with sensitive data
Compliance Checklist: Is Your Microsoft 365 Environment Ready?
At Reality Tech, we use this high-level checklist to evaluate client environments:
- Sensitivity labels deployed across SharePoint, OneDrive, and Teams
- Microsoft Purview policies tailored to your industry
- Data residency is documented and enforced
- Audit-ready logs through Purview and Defender
- Controlled app integrations with usage insights
- Governance strategy in place for Copilot and AI features
If you answered “No” to any of the above, your compliance program has blind spots.
Why Reality Tech?
Reality Tech is not your average Microsoft partner. We specialize in Microsoft 365 security and compliance, helping you:
- Stay ahead of evolving regulations
- Streamline audits and reduce manual overhead
- Mitigate risk without slowing your teams down
Whether you’re adopting Microsoft Purview, auditing your current setup, or preparing for Copilot, we bring deep compliance expertise and real implementation experience with our Microsoft Security and Compliance Services.
Want to talk?
Drop us a line. We are here to answer your questions 24*7.