Managed identity integration in Azure - Step-by-Step Execution

Process Flow - Managed identity integration

Enable Managed Identity on Azure Resource

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Azure assigns Identity to Resource

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Resource requests Token from Azure AD

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Azure AD validates and issues Token

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Resource uses Token to access Azure Service

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Azure Service validates Token and grants access

This flow shows how an Azure resource with managed identity requests and uses a token to access another Azure service securely.

Execution Sample

Azure

1. Enable managed identity on VM
2. VM requests token from Azure AD
3. Azure AD issues token
4. VM uses token to access Key Vault
5. Key Vault validates token and allows access

This sequence shows a VM using its managed identity to get a token and access a Key Vault securely without credentials.

Process Table

Step	Action	Request/Response	Result
1	Enable managed identity on VM	N/A	VM assigned a system-assigned managed identity
2	VM requests token from Azure AD	Request token for Key Vault access	Azure AD validates VM identity
3	Azure AD issues token	Token issued with access permissions	VM receives access token
4	VM uses token to access Key Vault	Token presented to Key Vault	Key Vault validates token
5	Key Vault grants access	Access granted based on token	VM can securely read secrets
6	End	No further requests	Process complete

💡 Process stops after VM successfully accesses Key Vault using managed identity token

Status Tracker

Variable	Start	After Step 1	After Step 2	After Step 3	After Step 4	Final
VM Identity	None	Assigned	Used to request token	Token received	Token used to access Key Vault	Access granted
Token	None	None	Requested	Issued	Presented	Validated

Key Moments - 3 Insights

Why doesn't the VM need to store any credentials to access Key Vault?

Because the VM uses its managed identity to request a token from Azure AD dynamically (see execution_table steps 2 and 3), so no credentials are stored on the VM.

What ensures that the token the VM receives is valid and secure?

Azure AD validates the VM's managed identity before issuing the token (execution_table step 2), ensuring only authorized resources get tokens.

How does Key Vault know to trust the token presented by the VM?

Key Vault validates the token against Azure AD's issued tokens (execution_table step 4), confirming the token's authenticity and permissions.

Visual Quiz - 3 Questions

Look at the execution table, at which step does the VM receive the access token?

A Step 2

B Step 3

C Step 4

D Step 5

💡 Hint

Check the 'Result' column for when the VM receives the token.

At which step does Key Vault validate the token presented by the VM?

A Step 3

B Step 5

C Step 4

D Step 6

💡 Hint

Look for the step where Key Vault checks the token in the 'Action' column.

If the managed identity was not enabled on the VM, what would happen at Step 2?

A Azure AD would reject the token request

B VM would still get a token

C Key Vault would grant access anyway

D VM would access Key Vault without token

💡 Hint

Refer to the 'Request/Response' and 'Result' columns at Step 2 about token validation.

Concept Snapshot

Managed Identity Integration in Azure:
- Enable managed identity on resource (e.g., VM)
- Resource requests token from Azure AD
- Azure AD validates and issues token
- Resource uses token to access Azure services
- Services validate token and grant access
- No credentials stored on resource, secure access

Full Transcript

Managed identity integration allows Azure resources like virtual machines to securely access other Azure services without storing credentials. First, you enable a managed identity on the resource. Then, the resource requests an access token from Azure Active Directory (Azure AD). Azure AD validates the resource's identity and issues a token. The resource uses this token to access services like Azure Key Vault. The service validates the token before granting access. This process ensures secure, credential-free access between Azure services.

Practice

1. What is the main purpose of using a managed identity in Azure?
Managed Identity helps your app to:

easy

A. Create new Azure subscriptions automatically

B. Access other Azure services securely without storing credentials

C. Run virtual machines faster

D. Manage user passwords in Azure Active Directory

Solution

1. Step 1: Understand managed identity purpose

   Managed identities provide apps a way to authenticate to Azure services without needing to store credentials like passwords.

2. Step 2: Identify correct use case

   Among the options, only accessing services securely without credentials matches the purpose of managed identities.

3. Final Answer:

   Access other Azure services securely without storing credentials -> Option B

4. Quick Check:

   Managed identity = secure access without passwords [OK]

Hint: Managed identity means no passwords needed for service access [OK]

Common Mistakes:

• Thinking managed identity speeds up VM performance
• Confusing managed identity with subscription management
• Assuming it manages user passwords

2. Which of the following is the correct way to enable a system-assigned managed identity for an Azure Virtual Machine using Azure CLI?

easy

A. az vm identity enable --name MyVM --resource-group MyGroup

B. az vm create --name MyVM --resource-group MyGroup --assign-identity

C. az vm identity assign --name MyVM --resource-group MyGroup

D. az vm identity add --name MyVM --resource-group MyGroup

Solution

1. Step 1: Recall Azure CLI command for managed identity

   The correct command to assign a system-assigned managed identity to an existing VM is az vm identity assign.

2. Step 2: Verify command syntax

   az vm identity assign --name MyVM --resource-group MyGroup uses the correct command and parameters. Other options use incorrect commands or flags.

3. Final Answer:

   az vm identity assign --name MyVM --resource-group MyGroup -> Option C

4. Quick Check:

   Assign identity command = az vm identity assign [OK]

Hint: Use 'az vm identity assign' to enable system-assigned identity [OK]

Common Mistakes:

• Using 'az vm create' with wrong flags
• Using non-existent commands like 'identity enable'
• Confusing 'assign' with 'add'

3. Consider this Azure CLI command sequence:

az vm create --name MyVM --resource-group MyGroup --image UbuntuLTS --assign-identity
az role assignment create --assignee  --role Reader --scope /subscriptions/123/resourceGroups/MyGroup

What is the expected result?

medium

A. The VM is created with a system-assigned identity and granted Reader role on the resource group

B. The VM is created without any identity and no role assignment is made

C. The VM creation fails due to missing identity parameters

D. The VM is created but the role assignment fails because the principal ID is invalid

Solution

1. Step 1: Analyze VM creation command

   The --assign-identity flag creates a system-assigned managed identity for the VM.

2. Step 2: Analyze role assignment command

   The role assignment grants the identity Reader access to the resource group scope using the identity's principal ID.

3. Final Answer:

   The VM is created with a system-assigned identity and granted Reader role on the resource group -> Option A

4. Quick Check:

   Assign identity + role assignment = secure access granted [OK]

Hint: Assign identity then grant role for access [OK]

Common Mistakes:

• Assuming VM creation fails without explicit identity creation
• Thinking role assignment needs user principal, not identity
• Ignoring the --assign-identity flag effect

4. You tried to enable a user-assigned managed identity on an Azure App Service but received an error. Which of the following is the most likely cause?

medium

A. The App Service plan is not Premium tier

B. The App Service already has a system-assigned identity enabled

C. The user-assigned identity was not created in the same subscription

D. The user-assigned identity is not assigned to the App Service resource

Solution

1. Step 1: Understand user-assigned identity attachment

   User-assigned identities must be explicitly assigned to the resource to be used.

2. Step 2: Identify common error cause

   If the identity exists but is not assigned to the App Service, enabling it will fail.

3. Final Answer:

   The user-assigned identity is not assigned to the App Service resource -> Option D

4. Quick Check:

   User-assigned identity must be assigned to resource [OK]

Hint: Assign user identity to resource before enabling [OK]

Common Mistakes:

• Assuming system-assigned identity conflicts with user-assigned
• Thinking subscription mismatch causes error
• Believing App Service plan tier affects identity assignment

5. You want an Azure Function to access a Key Vault securely using a managed identity. Which steps should you follow to set this up correctly?

hard

A. Enable system-assigned identity on the Function, grant it Key Vault access policy, then use identity in code

B. Create a user-assigned identity, assign it to the Function, then store its secret in Key Vault

C. Enable system-assigned identity on the Function, store Function credentials in Key Vault, then access Key Vault

D. Create a user-assigned identity, assign it to the Function, then use a password stored in Key Vault

Solution

1. Step 1: Enable system-assigned managed identity on Azure Function

   This allows the Function to authenticate without credentials.

2. Step 2: Grant the Function's identity access to Key Vault

   Set an access policy in Key Vault to allow the identity to read secrets.

3. Step 3: Use the managed identity in Function code to access Key Vault

   The Function can request tokens and securely retrieve secrets without passwords.

4. Final Answer:

   Enable system-assigned identity on the Function, grant it Key Vault access policy, then use identity in code -> Option A

5. Quick Check:

   Enable identity + grant access + use identity = secure Key Vault access [OK]

Hint: Enable identity, grant access, then use it in code [OK]

Common Mistakes:

• Storing passwords instead of using managed identity
• Confusing user-assigned identity with storing secrets
• Not granting Key Vault access to the identity