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The Old Way

In Exchange Online using Azure AD, the typical practice was that you had to directly assign users to the Exchange Administrator Azure AD administrative role. What happens behind the scenes is that a special Exchange role group named ExchangeServiceAdmins_(randomid) is created, and is then nested into Organization Management role.

The Problem with the Fancy New Way

Recently a preview was made available to allow cloud groups to be assigned roles so that you don’t have to do this on an individual user level. This is great for a lot of Azure AD roles, but as of March 2021 it is broken for Exchange Online. If you enabled it and receive 503 service unavailable or 403 access denied errors with the Exchange Control Panel, you’re in the right place.

The Workaround

Thankfully Exchange already has Group Based administration built into its own separate role based framework, so you can use this in lieu of this new feature.

Create a Mail-Enabled Universal Group

First you need to create a group (if creating the group in your onprem AD and syncing it to M365, it is VERY IMPORTANT that you both make it a universal security group and mail-enable it, otherwise it will be visible but not work). Wait for it to sync and confirm the group shows grouptype as Universal, SecurityEnabled when you run Get-Group 'MyGroupName'

Assign the Group to the Organization Management Role

Next, you can add this group to the Organization Management role using the Add-RoleGroupMember -Identity 'Organization Management' -Member 'NameOfMyGroup' Powershell command. One completed, members of this group will have equivalent access you would have gained assigning the Azure AD Exchange Administrator role.

Remove Existing Cloud Group Role Assignments

Finally be sure that you have removed all Azure AD cloud group role assignments from users who will be managing exchange. This assignment will override the native Exchange assignment and the users will still be broken.