By John Speare, Senior Technical Writer, Microsoft

This post describes how to install the Microsoft Online Services Directory Synchronization tool for Microsoft Office 365 onto a computer that is running SQL Server 2008.

By default, the Directory Synchronization tool in Office 365 comes with Microsoft SQL Server 2008 Express. SQL Server 2008 Express has size limitations which you should consider if you have a large organization.

We recommend running directory synchronization on a full installation of SQL Server 2008 if you will be synchronizing more than 50,000 objects. To determine how many objects your organization will be synchronizing, run the Microsoft Office 365 Deployment Readiness Tool.

If you determine that running the Directory Synchronization tool on a full installation of SQL Server is a requirement for your organization, follow the steps in this post. Otherwise, install the default version of the Directory Synchronization tool by following the guidance here.

Step 1: Download the Directory Synchronization tool

1. Sign in to the Office 365 portal.
2. Click Admin, and then click Users.
3. On the Users page, next to Active Directory synchronization, click Set up.
4. On the "Set up and manage Active Directory synchronization" page, under step 4, click Download.

Step 2: Install and configure the Directory Synchronization tool

The administrative credentials that are used to perform this installation must have rights within SQL Server to create the directory synchronization database.

1. As an administrator on the local Directory Synchronization machine, you will need to install the SQL Native Client application, which is used to provide communication and connectivity to your remote SQL server.  To find and install the proper SQL Native Client, use this link, which provides a Bing Search, where you can find the proper Native Client Application for (SQL 2005, 2007, 2010, etc):  Bing Search.
2. As administrator, open a command prompt, and then navigate to the directory where you saved the installation program.
3. At the command prompt, enter dirsync /fullsql.
4. If a User Account Control dialog box is displayed, click Continue, or type the user name and password of an administrator account, and then click OK.
5. On the Welcome page, click Next.
6. On the Microsoft Software License Terms page, read the license terms, select I accept the Microsoft Software License Terms, and then click Next.
7. On the Select Installation Folder page, select an installation folder location, and then click Next.
8. On the Installation page, wait for the installation to complete, and then click Next.
9. On the Finished page, click Finish.
10. On the computer where the Directory Synchronization tool was installed, navigate to \Program Files\Microsoft Online Directory Sync and double-click DirsyncInstallShell.psc1
11. At the Windows PowerShell prompt, do one of the following:
    • To install the Directory Synchronization tool on the same computer that has SQL Server 2008 Express, type Install-OnlineCoexistenceTool –UseSQLServer –Verbose
    • To install the Directory Synchronization tool by using a remote installation of SQL Server 2008 Express, type Install-OnlineCoexistenceTool –UseSQLServer –SqlServer <SQLServerName> -ServiceCredential (Get-Credential) –Verbose
    • To install the Directory Synchronization tool by specifying the installation of SQL Server, add the "-SqlServerInstance" parameter. For example, run a command that resembles the following:
        Install-OnlineCoexistenceTool -UseSQLServer -SqlServer <SQLServerName> -ServiceCredential (Get-Credential)  -SqlServerInstance <SqlInstanceName>
      • Note - If you are installing to the default SQL instance on the remote SQL server, do not use the -SQLInstance parameter in the above statement!
12. At the Windows PowerShell Credential Request prompt, type the user name and password of the domain account that will be used to run the Forefront Identity Manager Synchronization service and the Office 365 Directory Synchronization service.
13. Run the Microsoft Online Services Directory Synchronization Configuration Wizard to complete the installation. By the default, the Directory Synchronization Configuration Wizard (ConfigWizard.exe) is installed to \Program Files\Microsoft Online Directory Sync.

Step 3: Synchronize your directories

See the help topic, Synchronize your directories.

Parameter options for the Install-OnlineCoexistenceTool cmdlet

   -ServiceCredential <PSCredential>
       Credential to be assigned to the Forefront Identity Manager Synchronization service. When this parameter is not specified, an MIIS_Service account will be created on the local machine. The credential is also used by the Microsoft Online Services Directory Synchronization Service.

   -UseSQLServer
       This flag causes the install to skip installation of SQL Express. Use this flag with one or both of the following parameters: SqlServer, SqlServerInstance.

   -InstallPath <String>
       Optional parameter to specify the path to the folder that contains the files to be installed. These files include the SQL Express Setup program,
       SQLEXPR32_x86_ENU.exe, and the Microsoft Identity Integration Server.msi and DirectorySync.msi files.

   -SqlServerInstance <String>
       The name of the SQL Instance that Forefront Identity Manager will use.

   -SqlServer <String>
       The name of the server that is hosting SQL for Forefront Identity Manager .