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Many organizations are in the process of migrating their Exchange Server data to Office 365 to avoid maintenance expenses of the on-premises server. However, there are other reasons to migrate to Office 365; the extensive features and security of Office 365 make it attractive for businesses to migrate their data.
Once you have decided to migrate your data, the next step is choosing the type of Exchange to Office 365 migration. You can perform three types of methods to migrate your Exchange Server 2016 to Office 365 – Staged, Cutover, and Hybrid migrations. Each of these migration methods has its own peculiarities and processes. Furthermore, each of these methods is used based on a business’s migration requirements.
This article explains the step-by-step process of the hybrid migration method for migrating Exchange Server 2016 data to Office 365 or Microsoft 365.

What is Hybrid Migration?

Hybrid migration is a type of migration method used for migrating hybrid environment data. In hybrid migration, it is presumed some data is stored in the server and the rest in the cloud. Besides, performing hybrid migration is a bit challenging as compared to other migration methods.
There are two types of hybrid migration you can perform to migrate your Exchange Server 2016 data – Minimal and Full Hybrid migration. As cutover migration is familiar to all Exchange users, it often leads to a discussion on office 365 cutover vs minimal hybrid migration. If you’re planning to migrate mailboxes from on-premises Exchange 2016 to Office 365, using the minimal hybrid migration approach is recommended, as it is easy to set up. On the other hand, the full hybrid migration method does provide additional features but is hard to execute. Also, full hybrid migration takes longer to migrate the data.
The hybrid migration approach ensures smooth migration of data with minimal interruption for your business. Here, we will describe the step-by-step process of migrating Exchange Server 2016 data to Office 365.

Pre-requisites for Exchange to Office 365 Migration

The minimal hybrid migration is useful in the following scenarios:

  • You want to migrate the Exchange data patiently within a few weeks or less
  • You are using Exchange 2010, 2013, or 2016 server on-premises (it is not ideal for Exchange servers older than 2010)
  • You are planning to quit running directory synchronization to manage your users
  • You have a server to install the Azure Active Directory Synchronization tool

Steps to Migrate Exchange 2016 to Office 365

We have created a step-by-step process to help you migrate your Exchange 2016 data to Office 365. Each of these steps must be followed in the same manner to migrate your data without any errors.

  1. Authenticate the Domain Name
    While migrating the data from Exchange Server to Office 365, the Simple Mail Transfer Protocol (SMTP) address is used to create email addresses for the new Office 365 mailbox. To perform the minimal hybrid migration, you need to verify the on-premises domain in your Office 365 account. To verify the domain, follow the below steps:

    • Sign in to the Office 365 account with admin credentials and click Setup
    • Now, select Domains to open the domain page
    • From the Domain page, click Add domain to start the domain wizard
    • In the Add a domain section, enter the domain name you use for the on-premises Exchange server and click Next
    • The Verify Domain page appears on the screen, select from Sign in to GoDaddy or Add a TXT record, and click Next
    • Now, follow the instructions provided by the DNS hosting provider to verify your ownership
    • Add your TXT or MX record and wait for up to 15 minutes to move to the next step
    • Click Done in the domain wizard and the verification page appears on the screen; click Finish
  2. However, if the verification fails, wait for a few minutes and try again. Move to the next step once the domain is verified.

  3. Begin the Hybrid Migration
    Now, sign in to your Office 365 account with global admin credentials from the system where the domain is joined to your on-premises Exchange Server. Open the Exchange Hybrid Configuration Wizard on the Data Migration page of the Office 365 admin center and follow the below steps

    • From the Office 365 admin center, click Setup >> Data migration Data migration
    • The migration page appears on the screen, select Migration and click Exchange under the Select your data service sectionMigration and click Exchange
    • Click Next on the Hybrid Configuration Wizard page while accepting the default values. The wizard will connect to the Exchange Server by default
    • From the Credential page, select Use current Windows credentials for on-premises Exchange Server and enter the admin credentials to it and click Next
    • The Hybrid Features page appears on the screen, select Minimal Hybrid Configuration >> Next
    • Now, click Update on the Ready for Update page to prepare the on-premises mailboxes for migration.mailboxes for migration

  4. Create User in Office 365 with Directory Synchronization
    Before migrating the mailboxes, you need to create users in Office 365 to migrate the data accordingly. To create users in Office 365, you need to run directory synchronization.

    • From the User Provisioning page, select Synchronize my users and passwords one time. Then, you’ll be prompted to download and install the Azure AD Connect Wizard, which is used to synchronize users from the on-premises to Office 365select Synchronize
    • After downloading the Azure AD Connect, run it on your system and select the default options for Express settings
  5. Once the synchronization is finished, you’ll be redirected to the Data Migration page, where all the synchronized users are listed.
    Note: After the one-time synchronization of users, the directory synchronization turns off automatically in Office 365.

  6. Assign Office 365 Licenses to Users
  7. After synchronizing the users with your Office 365, you need to assign licenses to each user so that they can access their cloud mailboxes once the data is migrated. On the data migration page, you’ll notice the ‘license required’ status in front of each mailbox, as shown below:
    license required
    To give license to users, go to the admin center >> user. Click Active users to add users individually or in bulk.

  8. Migrate the User Mailboxes
    Once the licenses are assigned to the users, you can begin the migration process with the below steps:

    • Go to the Data Migration page and click Setup >> Data Migration, and select Exchange from the Migration page.
    • Select the user mailboxes you want to migrate to Office 365 and click Start migration.
  9. Note: Before migrating the entire mailboxes, it is recommended to migrate two or three mailboxes to check the migration process flow.
    When you start migrating the mailboxes, the Data Migration page will display the migration status as it progresses, as shown below:
    migration status as it progresses

  10. Updating the DNS Record
    Every email system uses a DNS record known as MX record, which is used to identify the delivery address of the emails. During the migration, the MX records point towards the on-premises Exchange email system. But, as you’re migrating to Office 365, you need to point the MX records at Office 365.
    Besides, you also need to set up your DNS records. To do so, follow the below steps:

    • Go to your Office 365 admin center and click Settings >> Domains.
    • Pick the domain name you want to update.
    • You’ll get the step-by-step process for updating DNS records on the domain wizard.
  11. You can update DNS records.
    The minimal hybrid migration works perfectly when the on-premises Exchange server has everything in place, which means there shouldn’t be any corrupted databases. However, you cannot migrate public folders within the above process; you need to perform a separate migration process for it. Besides, if the migration fails for any reason, you’ll have to create new migration jobs every time to migrate the data, which could be time-consuming and costly.
    So, what is the best way to quickly migrate on-premises Exchange mailboxes to Office 365 without any hassle or data loss?

It is advisable to use a third-party tool like Kernel Migrator for Exchange, which allows you to perform On-premises Exchange to Office 365 Migration quickly without going through a complicated process. Kernel Migrator for Exchange is an intelligent exchange migration tool specially designed to migrate single/multiple mailboxes from Exchange environments. It is integrated with smart features like selective data migration, migration scheduling, zero downtime, data synchronization, and more.
It follows a unique approach to migrate the Exchange mailboxes quickly to Office 365. It even allows you to migrate public folders within the same migration job. After finishing the migration, it also provides you with real-time reports of your migration.


Exchange Server 2016 to Office 365 migration has become very common for organizations, as everyone wants to avail the extensive features of the cloud and save money. But, the migration process is not that easy, as it involves complicated steps, especially if you choose the hybrid migration process. This article highlights the step-by-step process of migrating your Exchange on-premises mailboxes to Office 365 with the hybrid migration method. It also talks about an automated solution that can eliminate the hassles of manual Exchange to Office 365 migration.