Coming out of Microsoft Build, is the new ‘Dataverse MCP Server’, released just a couple of days ago in mid-May 2025, which is really exciting!

https://github.com/microsoft/Dataverse-MCP/blob/main/README.md

🧠 What Is MCP and Why Should You Care About It?

If you haven’t ever heard of MCP (Model Context Protocol) or Dataverse MCP Server and wondering what they actually mean, that’s okay. Let’s start there.

Model Context Protocol (MCP) is a Microsoft-designed standard that acts as a bridge between AI tools and enterprise data systems like Dataverse. It provides the AI with structured knowledge about your data model, security roles, and business rules—ensuring AI interactions are context-aware, secure, and aligned with your organization’s unique setup.

I recently deep-dived into the newly released Microsoft’s Dataverse MCP GitHub project, and while it’s packed with exciting potential, it can feel like a lot to unpack.

So let’s break it down, what MCP is, why it matters, and how developers and business users alike can use this to level up their AI solutions with clarity, context, and control.

🏢 The Office Building Analogy

Imagine your organization’s business data lives in a secure, complex office building, let’s call it Dataverse HQ.

Inside, you have:

• Different rooms: Accounts, Contacts, Cases, Leads, Applications.
• Rules about who can go where: Admins, Sales, HR.
• Etiquette and workflows: Forms to fill, buttons to click, logic that runs in the background.

Now imagine you invite an AI assistant — like ChatGPT, Microsoft Copilot, or Claude — to help out at the front desk.

But here’s the problem:

• The AI doesn’t know the layout.
• It doesn’t know the rules.
• It doesn’t have access cards.
• It might walk into sensitive meetings or open filing cabinets it shouldn’t.

You need a concierge — someone who knows your building inside and out, follows all the right rules, and can safely guide the AI to get what it needs without breaking anything.

That’s exactly what MCP is. And the Dataverse MCP Server? It’s the concierge you install specifically for Microsoft Dataverse to make this all happen for your environment.

🔍 So What Is MCP, Really?

MCP stands for Model Context Protocol — a standard Microsoft is creating to help AI agents interact with enterprise systems safely and smartly.

Large Language Models (LLMs) like Copilot or ChatGPT don’t inherently understand:

• What data you have
• What it means
• What your rules are
• What users are allowed to do

MCP provides structure and context so the AI doesn’t act blindly. It’s like giving it:

• A building map (your Dataverse schema)
• A rulebook (your security and validation rules)
• A translator (so it can speak API instead of plain text)

🧰 What Is the Dataverse MCP Server?

The Dataverse MCP Server (available on GitHub) is an open-source tool you install and connect to your Dataverse environment. It acts as that smart concierge between your AI tool and your business data.

✅ It:

• Reads your actual Dataverse environment (tables, columns, relationships)
• Respects your existing role-based security and field-level permissions
• Gives the AI a safe, structured way to query or update data
• Works with tools like Claude or VS Code Copilot to demonstrate how AI can interact intelligently

🧪 Is It Just Theory?

Not at all. The GitHub project includes:

• Hands-on labs
• A working local proxy server
• Sample scenarios to try out with real AI tools

It’s not a set of vague guidelines — it’s working code you can spin up to test with your real (or sandbox) Dataverse system.

🧭 How Does It Work Behind the Scenes?

Once you install and authenticate the MCP Server:

1. It connects to your Dataverse environment.
2. It pulls your metadata: tables, fields, relationships, and constraints.
3. It uses your role and permissions to ensure access control.
4. It translates AI requests (like “show me active accounts”) into real, secure Dataverse API calls.
5. It returns structured results back to the AI — including field names, types, business rules, and sample values — to help the AI stay accurate.

It’s not using Microsoft defaults — it’s using your real configuration. The AI behaves just like a user with your permissions would.

👩‍💻 Who Is This For?

For Developers:

• Build secure, AI-powered assistants for internal business processes.
• Test AI queries against Dataverse with full context awareness.
• Avoid reinventing the wheel — MCP handles the structure for you.

For Business Users & Solution Architects:

• Reduce the risk of AI generating incorrect or unsafe results.
• Leverage existing data models and security setups without rework.
• Get closer to the “AI that just works” dream — with governance built in.

🛠️ How to Get Started

If you’re interested in trying this out:

1. Clone the GitHub repo: Dataverse MCP Server
2. Run through the setup labs (they include clear instructions).
3. Connect to your Dataverse dev environment.
4. Try sample prompts with an AI assistant (Claude, GitHub Copilot, or others).
5. Review what AI can now do — and where you need to tune your model or metadata.

You’ll quickly see the power of context-aware AI in action.

⚠️ Things to Keep in Mind

• This is not a production-ready tool — yet. Think of it as a concept car, not the showroom model.
• It doesn’t enforce your full Power Automate flows or custom plugins (yet), but it can trigger them if Dataverse does.
• It’s designed for developers, architects, and tech-savvy business users to explore and extend.

💡 The Business Value

So why is Microsoft investing in this?

Because context-aware AI is the future. And enterprises need that AI to:

• Be accurate
• Be secure
• Be governed
• Be useful

With MCP, Microsoft is building the rails for copilots that can safely interact with enterprise data. It’s the beginning of AI that doesn’t just respond with general knowledge — it acts intelligently inside your business systems.

For those of us in the Power Platform and Dynamics ecosystem, this is a huge leap forward. We can now start prototyping and planning for AI solutions that respect our data, our security, and our users.

✨ Final Thoughts

AI is only as powerful as the context it’s given.

MCP — and tools like the Dataverse MCP Server — are Microsoft’s way of bridging the gap between generic AI intelligence and tailored business insight.

Whether you’re an architect, developer, product owner, or change champion, this is one of the most exciting tools to experiment with in 2025.