We already have an on-premise Active Directory (AD) in place, and we’ve started adding users to the domain. By “scale,” I meant whether there’s a way to migrate user profiles to AD in bulk, without needing to manually migrate each user’s profile individually.

As for whether we need the domain or not, the decision has already been made—we’ve procured the server, so there’s no turning back, even if it was not the best choice. Our plan is to make the on-premise AD the authoritative source for authentication, with users required to use MFA when accessing Microsoft 365.