What is Identity and Access Management (IAM)? A guide to IAM

Regardless of their location, employees need reliable access to organizational resources such as applications, files, and data. Traditionally, most employees worked on-site, where company resources were secured behind a firewall. Once connected to the company network, they could access everything they needed.

Today, with the rise of hybrid work models, employees require secure access to these resources whether they are working remotely or on-site. This shift underscores the importance of Identity and Access Management (IAM). IAM systems enable IT departments to regulate who can access specific resources, ensuring that sensitive data and functions are restricted to authorized users only. IAM provides secure access to company resources—such as emails, databases, and applications—to authenticated users while minimizing interference. The primary goal is to ensure that authorized personnel can perform their tasks efficiently while keeping unauthorized users, including potential hackers, out.

The need for robust access controls extends beyond just company employees. It also applies to contractors, vendors, business partners, and individuals using personal devices. IAM ensures that each user receives the appropriate level of access at the right time and from the correct device. This is crucial for maintaining organizational security and compliance. Modern IAM systems facilitate quick and precise verification of user identities and their permissions. By managing access rights effectively, organizations can protect sensitive information and maintain operational efficiency, making IAM an essential component of contemporary IT infrastructure and cybersecurity strategies.

How IAM operates

IAM (Identity and Access Management) involves two main components: Identity Management and Access Management.

Identity Management is responsible for validating login attempts against an identity database, which maintains a current record of all authorized individuals. This database must be regularly updated to reflect changes such as new hires, role adjustments, departures, and organizational changes.

The identity management database typically includes details such as employee names, job titles, supervisors, direct reports, mobile numbers, and personal email addresses. Authentication is the process of matching a user’s login credentials—such as username and password—with their information in the database.

To enhance security, many organizations implement multifactor authentication (MFA), also known as two-factor authentication (2FA). MFA adds an extra layer of protection by requiring users to verify their identity through an additional method beyond just a password. This often involves receiving a one-time code via SMS or email, which must be entered into the login portal within a specified timeframe.

Access Management is the second component of IAM. Once a user's identity has been authenticated, access management determines which resources the user is allowed to access. Organizations typically assign varying levels of access based on factors such as job role, seniority, security clearance, and specific projects.

The process of granting appropriate access levels following successful authentication is known as authorization. The primary objective of IAM systems is to ensure that both authentication and authorization are performed correctly and securely with every access request.

The importance of IAM for organizations

IAM (Identity and Access Management) plays a crucial role in cybersecurity by helping organizations balance the need to protect sensitive data while ensuring authorized users can access necessary resources. It allows IT departments to implement controls that restrict access to critical information to only those who need it, while making it challenging for unauthorized individuals to breach the system.

As cyber threats become more sophisticated, with techniques like phishing targeting users who already have access, IAM becomes even more vital. Without IAM, managing and monitoring who has access to organizational systems becomes cumbersome, making it harder to detect and respond to breaches. IAM systems help mitigate these risks by providing visibility into access levels and enabling the swift revocation of access when necessary.

Although no security solution can guarantee complete protection, IAM systems are effective at reducing the risk and impact of cyberattacks. Advanced IAM solutions, particularly those equipped with AI capabilities, can identify and neutralize threats before they escalate, minimizing potential damage and avoiding blanket access restrictions during a security incident.

Benefits of IAM systems

Implementing an effective IAM (Identity and Access Management) system offers several key advantages for organizations:

Targeted access control: IAM systems enable centralized management of access rules and privileges, ensuring that users have access only to the resources necessary for their roles. This is achieved through role-based access control (RBAC), which allows for scalable and precise restriction of access based on predefined or custom roles.

Enhanced productivity: While security is paramount, productivity and user experience are also critical. IAM systems facilitate user convenience by incorporating features like single sign-on (SSO) and unified user profiles, allowing employees to access various resources—whether on-premises, in the cloud, or through third-party applications—without multiple logins.

Reduced risk of data breaches: Although no security system is perfect, IAM solutions significantly lower the risk of data breaches. Tools such as multifactor authentication (MFA), passwordless authentication, and SSO enhance security by providing additional layers of verification beyond simple usernames and passwords, which are more susceptible to being compromised.

Data encryption: Many IAM systems include encryption features that protect sensitive data during transmission. Conditional Access capabilities allow IT administrators to enforce access rules based on criteria such as device type, location, or risk level, ensuring that data remains secure even if a breach occurs.

Reduced IT workload: IAM systems automate routine IT tasks, such as password resets, account unlocks, and monitoring access logs for anomalies. This automation reduces the burden on IT staff, allowing them to concentrate on strategic initiatives like implementing a Zero Trust security framework, which is built on principles of explicit verification, least privilege, and breach assumption.

Improved collaboration and efficiency: IAM facilitates secure and efficient collaboration among employees, vendors, contractors, and suppliers. By streamlining permissions and access processes, IAM systems expedite role transfers and onboarding, enhancing overall operational efficiency and enabling faster integration of new team members.

In summary, IAM systems provide critical benefits by balancing robust security with user convenience, reducing the risk of breaches, and optimizing IT operations and collaboration.