What is Identity and Access Management (IAM)?

A solid IAM system guarantees user access to resources employees need. Workers will be able to log on quickly and easily using secure forms of authentication. IT staff can manage privileges across an entire network without accessing specific apps. But attackers will find it much harder to compromise critical assets.

Key takeaways

Here are the main points about IAM that we discuss in-depth later in this article:

• Poorly secured access points can cause data breaches.
• IAM includes authentication (verifying users) and authorization (granting appropriate access).
• Components of IAM include Single Sign-On (SSO), Multi-Factor Authentication (MFA), Role-Based Access Control (RBAC), analytics, and Zero Trust.
• IAM aligns with AAA, ISO 27001, and NIST SP 800-63 standards and complies with GDPR, CCPA, HIPAA, and SOX regulations.
• IAM technologies include SAML, OpenID Connect, and SCIM.
• IAM is not a one-size-fits-all solution. It adapts to network architecture and needs.

Why is identity and access management important?

Identity and access management plays a central role in modern cybersecurity strategies. Organizations handle increasing amounts of sensitive data while supporting remote work, cloud environments, and hybrid infrastructures. Without IAM tools, user identities and permissions are difficult to monitor, leading to gaps that attackers can exploit.

Credential theft and unauthorized network access are among the leading causes of data breaches. Poorly managed user profiles put applications, databases, and confidential data at risk, allowing attackers to move laterally within network environments.

Identity and access management solutions guard the network perimeter at a critical point of vulnerability: the sign-in stage. By combining secure authentication, user verification, and granular privilege management, IAM systems enable strong identity protection while allowing users seamless access to resources.

Additionally, IAM systems help reduce the impact of insider threats. Whether due to negligence or malicious intent, insiders can misuse access to sensitive systems, leading to security incidents or data leaks.

By enforcing the principle of least privilege and monitoring user activity, IAM tools limit the scope of damage insiders can cause and allow organizations to detect unusual behavior quickly. This approach goes far beyond traditional password-based security, making it a core element of a robust cybersecurity framework.

Main IAM benefits

Identity and access management systems bring multiple benefits beyond access control. By implementing IAM tools, organizations can strengthen identity protection, improve efficiency, and support business growth while maintaining security.

Improved security

Passwords alone are a major vulnerability. Attackers can steal credentials, compromise accounts, and access sensitive data. IAM tools help solve this problem through multi-factor authentication (MFA), single sign-on (SSO), and continuous monitoring to verify users and detect suspicious activity.

Productivity gains

The other important benefit of IAM is boosted productivity for employees. IAM solutions enhance productivity by streamlining user access and reducing password fatigue, while IT have more time and control over network security.

Simplified compliance

Many compliance regulations require evidence of identity protection and restricted data access. IAM tools help organizations meet GDPR, HIPAA, and other requirements by enforcing security policies and generating clear audit trails for regulatory needs.

Reduced IT workload

IAM systems automate user onboarding, offboarding, and permission management. By eliminating manual account management, IAM solutions reduce the burden on IT teams while ensuring consistent access policies across the organization.

Enhanced user experience

A well-implemented IAM system improves the user experience by minimizing login disruptions, supporting SSO across multiple applications, and enabling secure remote access without unnecessary complexity.

Challenges of IAM

However, it is important to note that IAM can be complex. Common IAM challenges include:

• Implementing MFA. Employees may become frustrated with poorly designed MFA implementations with too many steps or complex requirements. Companies with a large remote workforce may also struggle to provide all workers with MFA hardware.
• Covering all endpoints. An IAM system must cover all network entry points. This includes IoT devices and work from home laptops. Provisioning all apps and users can be difficult. However, SSO can solve this problem by bringing all apps under a single secure access process.
• Managing permissions. Determining appropriate permissions can be difficult. IT teams need to assess the needs of users and roles, and constantly fine-tune privileges to balance security and access.
• Hybrid cloud deployments. IAM systems may cover both on-premises and cloud assets. Companies may struggle to find a hybrid solution that covers all assets and is compatible with legacy software.

How IAM works

Identity and access management systems come in different forms. However, they usually have two critical functions.

1. Authentication

When users log onto networks remotely or devices are connected, companies need evidence that they are what they claim to be. IAM technology authenticates each access request.

Authentication entails comparing user credentials against a central database. This database generally extends beyond passwords or user names. It can include MFA factors and contextual information about location and devices as well.

2. Authorization

After a user is authenticated, identity and access management systems must provide them with the right level of access to network resources. Each user must have the right privileges to carry out their duties. But no user should have more freedom than they require.

IAM functions assign permissions to each user. Users can have access to groups of applications but privileged access management can also be more detailed. For instance, users could have access to view data in a CMS. But the IAM system may deny them admin privileges needed to make changes.

In addition to those two key functions, IAM systems have an accounting function. They log user requests and report suspicious activity.

IAM technology must also establish visibility of the business user identity database. User profiles must be available for all services and devices, at all times. Without this connection, authenticating and authorizing users is not possible.

IAM components

When we ask the question what is IAM, we are really discussing a group of related technologies. A range of components work together to authenticate and authorize users. Core elements of an IAM framework include:

SSO

Single sign on creates a single point of access for all cloud or on-premises resources.

Workers log on with passwords and MFA factors. The IAM system authenticates and authorizes their request. SSO provides access to any resources they require. There is no need to submit credentials for more than one service.

MFA

Multi factor authentication strengthens perimeter defenses by adding extra access credentials. MFA factors include:

• Biometrics such as fingerprint or retinal scans
• Smart cards distributed across a remote access workforce.
• One time passwords (OTP) supplied by third party specialists like Google Authenticator. Employees receive a unique code to a personal device or specialist hardware tokens. Codes could arrive via email, SMS, or whatever is most convenient for the individual.

MFA adds another set of credentials above passwords and user IDs in all cases. MFA identification factors are time-limited or unique to the individual. They are, therefore, much stronger and more difficult to compromise than standard passwords.

RBAC

Role based access controls allow security teams to provision users with privileges that fit their corporate role.

Role based user provisioning reduces the workload on IT staff, making it easy to change user permissions as they change roles. RBAC automation helps avoid human error when off-boarding employees leaving the organization.

Analytics and risk-based authentication

IAM security systems may analyze contextual information and allow real-time permissions management. Risk based authentication (RBA) assesses user activities and assigns each action a risk score. IAM controls deny access if actions are deemed too risky.

Analytic tools capture information about user activities. Activity logs provide valuable information to optimize network protection. They also record evidence to achieve regulatory compliance.

Zero Trust

Zero Trust Network Access (ZTNA) is a security model based around the idea "trust no-one, authenticate everyone." The Zero Trust approach demands that users have minimal privileges inside network boundaries. This makes it a common aspect of IAM planning and architecture.

IAM implementation

IAM implementation requires to have a clear strategy in the first place. Your first step should be network architecture mapping. This way, you’ll be able to understand what resources you have and whether there are any existing IAM processes.

Afterward, list the users with wide-range access because they face the biggest risks. The second list should be for the rest of the users and their access levels. Then, make a risk assessment of all applications.

Now, you should improve your data storage practices. Data should be visible to security managers, and standardizing its formats is also highly recommended.

Finally, it’s time to choose the IAM solutions. They should have these main IAM functions: Authentication, Authorization, SSO, Auditing systems, and Identity federation. And don’t forget about the option to migrate from your existing tools.

While each IAM strategy differs according to the business type and its requirements, there are still key elements found in every instance:

• User management. Each user should get an identity that gives access to the resources. Your strategy should also address user (de-)provisioning.
• Authentication. All user identities must be verified at the point of entry. Using MFA and strong passwords is highly recommended.
• Authorization. Users should have access only to authorized resources. Administrators should have access to all sensitive information.
• SSO. It’s highly recommended because you get a single access portal for both cloud and on-premises resources.
• User directories. IAM works only with a constantly updated list of users. They shouldn't stay separated if there’s more than one user directory.
• Identity federation. An important part of any IAM strategy, identity federation allows users to connect with third-party SaaS apps and cloud platforms.
• IAM auditing. Regular auditing helps you track user activity and log security alerts. Audit data will also help to comply with data regulations.

To sum up, IAM implementation is a challenging feat. But with the right strategy and implementation of best practices, you will create a secure, convenient, and compliant system.

IAM standards

Identity and access management standards guide users when securing their network. Standards are security frameworks that explain how to comply with industry best practices or official regulations. They are a good foundation for implementation and compliance strategies.

Relevant standards to think about include:

• AAA. AAA is the standard IAM framework. It describes a three-part strategy including authorization, authentication, and accounting (see above).
• ISO 27001. Created by the International Standards Organization, ISO 27001 deals with creating an information security management system. Part of this process involves controlling access and assigning privileges.
• NIST SP 800-63, Digital Identity Guidelines. Seeks to provide clear guidance for access management that is applicable to all corporate users.

IAM and compliance regulations

IAM enables companies to show evidence of compliance. Numerous worldwide regulations demand robust data protection. This includes measures that limit user access to confidential data, with significant financial penalties for non-compliant organizations.

In the IAM domain, relevant compliance regulations include:

• GDPR (General Data Protection Regulation). Created by the European Union. This regulation deals with data security for businesses operating within EU boundaries and IAM is a critical aspect. Companies can achieve compliance by ensuring information is only accessible for authorized users.
• CCPA (California Consumer Privacy Act). Applies to companies operating in the State of California. This regulation dictates how companies should protect sensitive data, including limiting access to authorized individuals.
• HIPAA (Health Insurance and Portability Act). Sets out requirements for companies handling private medical records in the USA. Includes detailed requirements for protecting patient data via access management.
• SOX (Sarbanes-Oxley Act). Regulates financial corporations in the USA. Includes a sub-section on data protection. This explains how companies should secure financial data, including preventing unauthorized access.

IAM technologies and tools

Identity and access management technologies allow users to meet the standards and regulations described above. IAM solutions include standard languages and tools that operate across any IAM platform.

• Security Access Markup Language. SAML is an open source standard for exchanging authorization and authentication information. SAML uses digital signatures to exchange data, and forms a core part of many SSO systems.
• OpenID Connect. Works on top of the OAuth 2.0 protocol, allowing third-parties to securely access network resources. OpenID Connect adds IT management to OAuth, and is commonly used to build SSO portals.
• System for Cross-Domain Identity Management. SCIM is a cloud-based standard for exchanging user profiles. It is generally used in privileges management setups, making it possible to share user profiles safely across cloud environments.

Learn more about IAM compliance.

The importance of IAM in cloud computing

Several factors make IAM a critical technology for data management in the cloud.

Cloud assets are hard to secure via traditional passwords. Employees require many credentials to access the resources they use. Human error and credential thefts are common causes of external data breaches.

The cloud itself is device agnostic. Remote workers may use unsafe endpoints, putting cloud-hosted applications at risk. Attackers on public wifi could gain access to cloud assets while posing as legitimate users.

Instead of device or location-based security, IAM focuses on user identities. Identity-centered approaches are a much better way to handle cloud computing security risks.

• Systems assign privileges to roles or users. Under Zero Trust principles, users only have access to assets they need. Nobody can roam freely across cloud platforms and apps.
• SSO covers complex cloud deployments, bringing all cloud resources together under one access point.

Difference between identity management and access management

As the name identity and access management suggests, identity and access are distinct concepts. It’s important to know the difference when implementing IAM.

• Identity management is the storage of information about user identities. It stores user data in a central database and compares access credentials against this data. If the information matches, identity management systems allow entry to network resources.
• Access management is the counterpart to identity management. It assigns privileges to legitimate users. Access management tools allow users to run specific apps or platforms, while keeping sensitive resources off-limits.

Control dynamic perimeters with identity and access management

Information security starts with managing access. Companies need to allow access to workloads and operational databases. But they also need to prevent access for individuals who seek to cause harm. Identity and access management makes this balancing act possible.

IAM tools allow organizations to protect hard-to-secure cloud assets. They make it easier to prove compliance with data security regulations. And they simplify network management via tools like SSO. These reasons make implementing IAM a must for most businesses.