Synchronize users and groups from a local directory to Office 365 to create those objects in Azure Active Directory, which ...

Synchronize users and groups from a local directory to Office 365 to create those objects in Azure Active Directory, which is how we manage identities in the cloud. You can also sync passwords to minimize change for your users. After you set up directory synchronization all user management is done locally and any changes you make will sync to Office 365.