
IAM is a framework of policies, technologies, and processes that ensures the right individuals have access to the right resources at the right time and for the right reasons. These individuals can include employees and contractors (Workforce IAM), end users like customers or subscribers (Customer IAM, or CIAM), and external partners such as vendors or service providers [Business-to-Business (B2B) IAM].
It combines key functions like:
In modern organizations, IAM plays a crucial role in enabling secure, seamless access to hundreds of systems spanning cloud and on-premises environments, across both internal and external audiences/
Employees, contractors, consumers, and partners interact with a wide range of tools daily – Salesforce, Microsoft 365, Google Workspace, Slack, Jira, ServiceNow, internal databases, VPNs, and more. IAM systems streamline access to these resources while maintaining control and visibility in the background.
For example, when an employee joins a company, their digital identity is created and provisioned with appropriate roles. As they access tools like email, internal dashboards, or project management systems, the IAM system authenticates them, applies access policies, and grants access accordingly. Similarly, a customer creating an account on a retail app or a supplier accessing a logistics platform is authenticated, authorized, and monitored using the same IAM principles.
This unified approach replaces manual provisioning, reduces reliance on insecure password habits, and ensures that access privileges are consistent and auditable across systems.
IAM has never been more important. Remote work, regulatory scrutiny, data breaches, and cyberattacks are all on the rise. IAM is no longer just an IT concern; it’s a business necessity.
As traditional network perimeters dissolve, identity has become the new perimeter. Users now connect from anywhere across a mix of cloud services and on-prem systems, often using personal or unmanaged devices. In this environment, the most effective way to protect sensitive data and systems is to verify who someone is, what they should have access to, and under what conditions.
Today’s organizations must secure both cloud environments and legacy infrastructure that’s unlikely ever to move off-premises. IAM bridges these worlds, delivering both strong security and a smooth user experience for all user types – ranging from internal teams to customers and business partners.
Most organizations now use a mixture of cloud services and on-premises applications. Internal databases, VPNs, and line-of-business applications remain vital, especially in industries like banking and critical infrastructure. Similarly, customer-facing services and partner integrations often reside in the cloud, requiring IAM systems to unify across internal and external environments.
Without unified identity governance, managing access becomes complex and inconsistent.
While cloud IAM platforms have advanced rapidly, many still struggle to cover legacy systems that can’t be migrated. For mature or regulated industries, these systems are non-negotiable. They still require strong authentication, policy enforcement, and auditability, but are often left behind in cloud-first IAM strategies. This is true for both internal systems and legacy customer-facing applications that remain critical to service delivery.
Despite the rise of more secure methods, passwords remain the most common authentication mechanism. They’re also one of the weakest. Users forget them, reuse them, or store them insecurely. Even one compromised password can open the door to sensitive systems. This challenge spans employee accounts, customer logins, and third-party access points.
One-size-fits-all authentication doesn’t work across varied users, devices, and data types. Some users need high-assurance controls like step-up authentication, while others benefit from low-friction access to low-risk systems. IAM enables adaptive security policies for different identity types – ranging from privileged admins to everyday customers.
Remote work, BYOD policies, and the growth of third-party access mean that traditional perimeter-based access models no longer suffice. Users now expect secure access from anywhere, on any device, at any time. This also applies to customers accessing mobile apps and APIs, as well as vendors collaborating via shared systems.
Regulatory frameworks like PCI DSS, ISO 27001, and NIS2 require organizations to apply strong access controls, protect sensitive data, and maintain audit trails. CIAM and B2B IAM play a critical role here, ensuring external access also complies with industry and regional regulations.
At its core, IAM is about ensuring that the right people - and only those people - can access the right systems and data. It does this by managing the whole identity lifecycle, from account creation to access enforcement and eventual deactivation. Here’s what that process usually looks like:
IAM solutions consist of several components that work together to create secure and seamless access experiences across environments.
While all sectors face pressure to secure access, it’s especially important for BFSI organizations. They handle sensitive personal and financial data, operate under intense regulatory scrutiny, and are prime targets for cyberattacks. At the same time, they must offer fast, seamless services to employees, customers, and third-party partners, often across a complex mix of cloud and legacy systems.
IAM provides the foundation to meet these competing demands, offering the visibility, control, and scalability that BFSI organizations need to operate securely and efficiently.
Not all IAM platforms are created equal. While the core goal – managing identity and controlling user access – remains the same, the way different solutions approach that goal can vary significantly. When evaluating an IAM solution, look for one that offers security without friction, flexibility without complexity, and visibility without blind spots.
Here are the key capabilities to look for.
A modern IAM tool should secure access to SaaS, cloud-native, and legacy on-premises applications. This is especially critical for organizations with longstanding infrastructure that can’t easily be replaced or migrated. Look for platforms that integrate with both modern and legacy systems without requiring parallel toolsets or creating silos.
Different users, devices, and applications require different levels of assurance. Your IAM solution should support a broad range of MFA methods and be applied intelligently based on risk, context, and compliance needs.
Reducing reliance on passwords improves the user experience and removes one of the most common attack vectors. Prioritize support for phishing-resistant methods like FIDO2, biometrics, and certificate-based authentication.
Your IAM solution should let you define and enforce consistent, granular access policies across your environment. Conditional access based on role, location, device type, or behavioral risk scoring ensures only the right people have access to the right resources under the right conditions.
User-led enrolment, SSO, and context-aware access help reduce login fatigue and minimize support tickets. IAM should empower users to access what they need securely and without disruption.
Built-in logging, reporting, and SIEM integration will allow you to monitor access attempts, investigate anomalies, and meet audit requirements. This is particularly important for regulated industries like BFSI, healthcare, and government.
Choose IAM solutions that support standard protocols – such as SAML, OIDC, and SCIM – and integrate cleanly with HR systems, customer identity providers (like social logins), and partner logins. Avoid rigid solutions that can’t evolve with your identity landscape.
IAM should remain operational even during outages. Features like fallback authentication and high-availability architecture ensure users can still access critical features without disruption.
Having the ability to manage who can access what and under what conditions is a necessity.
IAM is the foundation of secure, seamless operations. It ensures that only the right individuals have access to the right resources at the right time, without creating barriers to productivity. It helps security and IT teams ensure consistent policies, reduce human error, and gain complete visibility into user behavior across environments.
For high-risk sectors like banking, financial services, and insurance, IAM offers the control, flexibility, and auditability needed to balance access and assurance.
IAM doesn’t just streamline access – it drives productivity, collaboration, and trust. It empowers employees to do their jobs without friction, frees IT teams from manual provisioning and constant credential headaches, and enables seamless, secure collaboration with third parties. For consumers, it builds trust by ensuring their data is protected and their experience is smooth.
Ultimately, IAM is about more than who gets access; but how, when, and why. That’s what makes IAM essential to secure, resilient business operations.