What is Identity and Access Management and Why It’s Important for Modern Companies

10 Min read

In today’s digital-first world, data lives everywhere. So, how can modern organizations make sure that the data and resources are accessed only by the right people and job roles? This is where Identity and Access Management can prove instrumental by acting as a gatekeeper for a range of identities right from people, software to IoT devices. 

Over the years, the compute environment within the organizations has become even more complex. From on-premise systems, we have now moved to hybrid-cloud and multi-cloud environments. Due to the COVID-19 pandemic, more and more workers are working remotely. As a result, there is an increasing set of identities, user accounts, services and associated privileges that have to be managed. Given this fact, Identity and Access Management (IAM) solutions are now more critical than ever before.

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IAM solutions are critical for identifying, authorizing and authenticating different stakeholders who want access to a specific portal, an application or a network. An effective IAM strategy is crucial for modern-day enterprises to keep them safe from security breaches. Further, it gives them a scalable solution to manage accesses and authorization of identities across the enterprise. 

Understanding IAM 

Before we explain IAM in more detail, let’s first define some common terms.



An identity is defined by characteristics that include attributes such as name, e-mail address, date of birth or a nationally recognized number that is unique to the person. 


Access is given based on the successful authentication of the user’s credentials, and the specific rights given for accessing a specific portal, application, database or network. 

Authentication and Authorization

In order to better understand IAM, it’s important to differentiate these two terms.

  • Authentication – Authentication helps in establishing that a person who claims to be, is actually the person who wants access to a system. This can be done via methods such as passwords or biometrics such as fingerprints or one time dynamically generated access codes. 
  • Authorization – Authorization controls the key actions that users are allowed to perform with respect to networks, applications, databases or any other IT infrastructure resources. The rights of users define the actions that they can undertake. 


How Identity and Access Management Works

With increasing digitization, IT environments have become more complex and diverse. As users can be based anywhere and can access systems from any remote location, security threats have increased manifold. In such a scenario, it is not enough to just have a strong password.  Today, identity management systems must use multiple methods for authenticating users. For example, for ensuring access, the IAM system could ask for a combination of the password and/or a biometric authentication (such as fingerprint) or a temporary OTP that is generated dynamically at the time of login. This helps in strengthening the overall security as it adds another layer of security.

Once the IAM framework is implemented, IT administrators can enforce access controls. This helps in regulating access to systems, applications, networks or databased, based on the specific roles of individuals. Access can be further customized to allow viewership, modification, creation or deletion of specific files or settings.

Identity and access management systems help organizations in:

    • Creating or removing users 
    • Defining specific rights of users according to their job roles 
  • Adding more layers of security which can be necessary for access to sensitive or confidential data or systems


Five benefits of IAM solutions


Improved security

IAM solutions help identify and mitigate security risks. IAM systems can also be used to identify or be alerted of specific policy violations across different systems. This helps in ensuring that the security procedures are in adherence to the required regulatory policies as mandated by law or industry. 


Information sharing

Using IAM systems, organizations have access to a centralized platform that can provide information related to identity and access management. IAM systems also help in enforcing policies with respect to authenticating users, checking privileges and validating them.


Ease of use

For administrators, IAM systems simplify the process of management of user names and access rights. This can be effectively managed across applications, systems, networks or databases. Depending on their job profiles, access management rights can be given and permissions can be granted. IAM systems can also provide access based on the history of the user, the risks and the context in which the user is requesting specific access to IT infrastructure resources. 


Productivity gains

As IAM systems centralize access by aggregating all policies related to access, it helps administrators to apply a scalable and consistent method of applying policies. IAM systems also allow administrators to allow automation principles which helps in granting or revoking permissions to IT infrastructure resources in a simple and effective manner. Automated provisioning tools can also be used to instantly provide access by just checking the rights of the user. This helps in freeing up valuable time of IT administrators who can concentrate on other priority tasks. 


Reduced IT Costs

IAM services can lower operating costs. By using federated identity services, organizations no longer have to depend on local identities for external uses. This simplifies the process of application administration. Organizations can also leverage cloud-based IAM services to reduce or eliminate the need for purchasing or maintaining on-premise IAM systems. 

What are the challenges and risks of implementing IAM?


One of the key challenges associated with IAM is that with the workforce spread around the globe, there is a need to provide consistent experience to employees, partners and customers spread across the globe. One needs to support different languages in different countries, wherever the company operates. Further, it is imperative to comply with specific regional and local regulatory requirements in addition to global regulatory requirements. Thus, the IAM solution needs to have the flexibility to be strong in some regions and relaxed in others. 

One thing organizations need to watch out for is IAM living in silos housed in various departments. When each department, including information security, application development, and regulatory compliance customizes access privileges, the patchwork IAM strategy can derail the initiative. It can affect provisioning and de-provisioning of access and lead to lost productivity, and even security breaches.

A successful IAM implementation requires forethought and collaboration across departments. Companies need to highlight objectives, stakeholder buy-in, defined business processes before they embark on the project. Several companies are choosing the managed services route to ensure robust IAM capabilities across all target systems.

What IAM means for compliance


To protect the organization and customer data, it has become imperative for organizations to meet compliance requirements, such as PCI, Sarbanes-Oxley, HIPAA, etc. That said, meeting compliance is not easy, it’s expensive, resource consuming and on top of it, regulations are constantly changing. IAM solutions can help organizations meet numerous compliance requirements by providing the necessary tools to implement comprehensive security, audit and access policies. IAM solutions can bolster security posture by:

  1. Ensuring centralized administration and management of user access rights and authentication.
  2. Enforcement of policies related to Segregation of Duties (SoD). 
  3. Altering access rights in case of change in the job function. 
  4. Managing access keeping in mind the job roles and providing least privilege
  5. Regular assessment of access rights and privileges and generating automated reports.


IAM use cases


IAM enables enterprises to easily create or delete digital identities and manage access rights. In a world which is increasingly becoming digital, this is extremely important. From onboarding users to account activation and deactivation, IAM plays a key role. In most companies, the IAM process is completely automated and requires extremely less human intervention. 


Use case How IAM can help
Password management IAM systems help enterprises enforce policies that improve the overall process of password management. For example, enterprises can use IAM systems to enforce multi-factor authentication and nudge users to frequently update their passwords  
Simplify access   For most users, remembering passwords for multiple systems is a challenging task. An IAM system can simplify access by providing users with a Single Sign on (SSO) that allows them to access all applications
Improve compliance With IAM systems, it is relatively easier to enforce security policies that help enterprises comply with different regulations effectively. Policy violations can be easily identified and flagged off and appropriate actions can be taken by removing the required access privileges. This is further strengthened due to role-based access where employees only have access to systems which are required to fulfil their job responsibilities  


Cloud Vs On-Premise IAM 

While IAM is no longer an option for organizations, they can choose between cloud-based or on-premise solutions. Being a newer technology, cloud-based IAM promises several advantages, including greater scalability, reliability and savings. It can be integrated into a number of cloud solutions, ensuring a centralized identity solution. Since it is a single point access that has to be managed and controlled, it is preferred in terms of security. With a cloud-based solution, organizations can also outsource IAM to a managed services provider and concentrate on revenue-generating activities. 

That said, there is still one area where on-premise scores over cloud solution: security. On-premise solutions are not accessible from anywhere other than the internal network. Further, on-premise solutions can operate without external network access and still function even if the entire network is disconnected from the Internet. In fact, on-premise solution is even more protected and faster with access to a WAN. 

Hybrid Solutions: The Win-Win


Many organizations are opting for hybrid solutions to get the best of the both worlds. They benefit from the scalability, flexibility and accessibility of the cloud, while still getting the security and privacy of on-premise solutions from a single solution. The hybrid solution gives organizations the choice to place their applications and data where they fit best. With the ability to run, unify, and secure all digital identities and their accesses with a central platform, hybrid solutions offer organizations the advantage of enhanced compliance and performance. 


Types of IAM technologies and tools


IAM systems support several standards and technologies:

Security Access Markup Language (SAML): An XML-based open standard, SAML is a widely accepted way to communicate a user’s identity to cloud service providers. SAML is a technology for user authentication and enables transfer of identity data between an Identity Provider and Service Provider. It contains all the necessary information of a service provider to confirm user identity. It makes single sign-on (SSO) technology possible by providing a way to authenticate a user once and then enabling users to access multiple applications. This allows for a faster authentication process and users are not required to remember multiple login credentials for every application. SAML promises increased security as the credentials are sent to the identity providers directly.  

OpenID Connect: It is an authentication protocol which allows to verify user identity when he is trying to access a protected HTTPs endpoint. It relies on the authorization server to obtain basic profile information about the end-user and share the information with Web-based, mobile, and JavaScript clients. OIDC is extensible and can be configured to meet the required security demands of an enterprise. This authentication protocol is more popular with consumer and native mobile applications, like gaming or productivity apps.

System for Cross-domain Identity Management (SCIM): This is an open standard that has been created to manage the information with respect to user identities. The SCIM standard helps enterprises to automate the exchange of information with respect to user identities between their cloud-based applications and third party service providers. By using SCIM, organizations can ensure that data is stored in a consistent manner and automatically shared with applications. 

What does an IAM strategy need to include?

Central identity management: For successful IAM implementation, businesses need to centralize security and access to critical systems around identity. This means all processes related to IAM is in a centralized environment. Centralized access to multiple applications and systems simplifies the experience and enhances the level of security. The user needs to sign in a single workspace to access all the applications and tool they need. 

Policy-based control: By defining access privileges based on user’s job or role in an organization, access management can be simplified. Access can be defined or controlled as per the requirements of the job or job level.  

Secure Access:  To ensure secure access, the IAM solution needs to authenticate user identities with multi-factor authentication. This adds another layer of security and forces users to share more than one type of proof to authenticate their identity. For example, this could be a combination of a password and a fingerprint. 

Zero-Trust Policy:  Zero Trust model treats all users, internal or external, as untrusted. It differs from the earlier policy of ‘once you are in, you have access.’ Zero-trust policies ensure that each member of the organization is constantly being identified and their access managed. With a zero-trust model, organizations can ensure strong security posture while ensuring a productive user experience. 

Secured privileged accounts: Some accounts that have more privileged access to sensitive information should be provided an additional layer of security. Any compromise to these accounts can turn into one of the worst security nightmares. To prevent such issues, such type of accounts can be effectively monitored and isolated to prevent further misuse of any privileges. 

Training: Awareness about IAM systems and processes is critical for ensuring the success of any IAM-related initiative. Training can play a big role in making sure that all users are well educated and have adequate knowledge to ensure that the full potential of an IAM system is realized. 



IAM has many operational & security benefits, and for many organizations it becomes an absolute necessity when compliance requirements arise. Your job as a security leader is to implement it seamlessly, without interrupting ongoing work while utilizing its full arc of benefits. Contact us today to make this implementation a breeze.


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