Introduction

Microsoft Copilot agents can now tap into the entire enterprise data landscape through natural language queries with Denodo MCP connectors. This integration makes it easier than ever to build autonomous AI agents capable of deriving insights and value from an organization's data ecosystem.

With Denodo's AI SDK MCP and VDP MCP Server, integrating Denodo in Copilot workflows is more  straightforward than ever. Forget building complex Power Automate flows, MCP makes Denodo AI capabilities available as native tool actions inside Copilot Studio.

Requirements

• Denodo AI SDK or Denodo VDP MCP hosted on an Azure accessible IP.

• For Denodo AI SDK requirements, please refer to its manual.
• For Denodo VDP MCP requirements, please refer to its manual.

• Microsoft Azure maker-level credentials.
• Microsoft Copilot Studio license.

Creating an Agent in Copilot Studio

Open Microsoft Copilot Studio and click on Agents > New agent.

After you have finished defining and naming your agent, click on “Create” to instantiate your Agent.

Once you have created a new agent, navigate to the Tools tab.

Then click on + Add a tool

After that, the “Add a tool” wizard will appear. Click on + New Tool. This will be where you define our MCP connection and authentication if desired.

After selecting + New Tool, select connect to an MCP

Next you will define the MCP connection to our Denodo AI SDK or VDP MCP with the following parameters:

Server Name: A name for your MCP Connection Server Description: A description for the MCP Connection Server URL: Either <AI SDK URL>/mcp or <VDP URL>/<database name>/mcp

Authentication

Copilot studio supports MCPs with three authentication standards:

• None
• API key: Configure API key authentication.
• OAuth 2.0: Configure OAuth 2.0 authentication.

API key

Select “Header” if your Denodo environment requires credentials to be passed as part of the HTTP request headers. This method provides flexibility to various authentication schemes manually, including:

• Basic Authentication: Passing a Base64 encoded string.

• Manual OAuth/Bearer Tokens: Passing a static access token to Copilot Studio.

 

For more information visit: Connect your agent to an existing Model Context Protocol (MCP) server - Microsoft Copilot Studio 

OAUTH 2.0

Use this option to let Copilot Studio, the MCP client, negotiate the authentication via OAuth directly with Denodo.

This approach supports three different options, and Denodo MCP tools can work with either Dynamic discovery or Manual. Choosing the right one for you depends on the capabilities and configuration of your IdP.

Dynamic Discovery

Select this option if you have configured the Denodo MCP and Denodo with OAuth 2.0 dynamic client registration. The client will use the discovery endpoint to automatically discover the necessary endpoints and register itself with the identity provider.

For more information on Copilot Studio Dynamic Discovery settings: Connect your agent to an existing Model Context Protocol (MCP) server - Microsoft Copilot Studio

For more information on Dynamic Discovery:How OpenID Connect Works 

Manual

Select this option if you have not configured Denodo and Denodo's MCPs to have Dynamic discovery but have OAUTH2 configured. In this case you will need to provide all the necessary parameters for your authentication application.

For information on configuring Denodo with OAUTH, visit here: OAuth Authentication.

Required Fields from Authentication Server:

• Client ID.
• Client Secret.
• Authorization URL.
• Token URL.
• Refresh URL.

Example with Entra ID Client ID: {client ID} Client secret: {Client Secret} Authorization URL: https://login.microsoftonline.com/{tenant_id}/oauth2/v2.0/authorize Token URL template: https://login.microsoftonline.com/{tenant-id}/oauth2/v2.0/token Refresh URL: https://login.microsoftonline.com/{tenant-id}/oauth2/v2.0/token Scopes: …

After configuring the OAUTH definition, click on Create to proceed to the next step.

Next you will need to configure the redirect URL with our OAUTH provider.

Finalize your OAUTH Provider Definition

After clicking on Create, Copilot Studio will generate a redirect URL for this connection. You will need to add the redirect URL to our OAUTH provider (e.g. Okta, Entra, IAM etc..) to validate authentication responses (tokens) after successfully authenticating or signing out users.

For security reasons, the authentication server won't redirect users or send tokens to a URI that is not added to the OAUTH app registration.

After that, click on Next.

After configuring the redirect URL to our Authentication Application and selecting next, the MCP connections management page will open.

Perform initial authentication

To finalize your MCP connection, to comply with Microsoft policy, the user who is creating the connection will have to authenticate the MCP tool with Denodo. Keep in mind that these are not the credentials that will be used during execution, as those will be the credentials of the end users.

Click on *Not Connected* drop down menu and select “Create new connection”

This will take you to an individual connection page like the following, select Create.

This will open a pop-up authentication window from your Authorization server. Sign in as your user

After Signing in, the Connection will appear and you can click on “Add to Agent” to finalize your setup

Personalizing the Denodo MCP agent and setting up Authorization

Within Copilot Studio, you can configure agents to distinctly interact with Denodo MCP tools in different ways. This can be managing  authentication, adding knowledge bases for company specific terminology or defining human in the loop events for using tools. One way to configure is within the agent's Tools tab where you can see the server you just defined.

If you click on the Denodo MCP server, you can get access to some configurations specific for this MCP.

Within the MCP server configuration, you can see multiple configuration menus for our MCP.

Related to connection and usage to the MCP, you can configure:

• Ask the end user before running.

• Credentials to use (whether to use the credentials provided, or those of the end user).

NOTE: It is encouraged to use “End user credentials” for any agent connected to the Denodo Platform to leverage user and role-based access controls.

• Description: a meaningful descriptor for the LLM to know when to use the MCP.

You can also configure additional optional properties of the LLM  for using of the MCP like:

• Inputs: to control how prompts are used in the MCP.
• Tools: to select which tools are available to the agent.

For more information on how you can configure and personalize your Denodo MCP within Copilot Studio visit the official Microsoft Documentation:  Add tools to custom agents - Microsoft Copilot Studio 

Publishing the Agent to Teams and Copilot

Copilot Studio can act as a central distribution hub for Denodo connected Agents, allowing your agent to be instantly available across multiple channels. Instead of building separate integrations for Microsoft Teams and Microsoft 365 Copilot, you configure your Denodo connection via MCP or connectors a single time within the Studio. This simplifies deployment by unifying authentication and data access logic, ensuring that your team can query Denodo datasets securely; whether they are collaborating in a Teams chat or drafting content in Word.

To find out which options are available to publish your Denodo Agent, click on the Channels tab of your agent.

Individual publishing channels require specific configuration within the agent, for example Teams and Copilot require the agent to inherit the authentication for the Team/Copilot User.

For more information on configuring agents for publishing to channels visit: Key concepts - Publish and deploy your agent - Microsoft Copilot Studio.

Summary

By connecting Denodo MCP to Microsoft Copilot Studio, you eliminate the costly, time-consuming data pipelines traditionally required for AI to access Enterprise insights. With Denodo's MCP tools, there is no need to build Power Automate workflows, build data pipelines, or replicate data.

Your autonomous AI agents get secure, real-time access to query data where it lives, tapping into the unified enterprise data fabric. This "query once" approach means you can instantly build and deploy sophisticated Copilots that derive insights from your entire data ecosystem, dramatically accelerating time-to-value and ensuring your agents always act on the freshest, most accurate information.