The Business Case for IAM: Calculating ROI for Your Organization

Organizational security and identity management are atop every business agenda, small or large, in today's connected world. Recovery costs and fines can quickly total to millions of dollars in a few unwanted breaches or misuse by an insider with inappropriate access. Among the best ways to fight this threat is Identity and Access Management systems. IAM's bottom line is creating an environment where only the right people have access to the right resources at the right time, making it a critical element of a robust approach to cybersecurity.

While any large investment needs to be justified, businesses must therefore determine the ROI of IAM solutions. Knowing the business case for IAM, how to calculate the ROI, and why it is critical to an organization can help provide much-needed clarity in the eyes of stakeholders over an investment that is seen as a priority.

Understanding Identity and Access Management (IAM)

This is a framework of policies and technologies that would enable organizations to control digital identities and user access to information. The IAM's single most important contribution to any organization can therefore shield the required systems and data from access by other people with no right or permission to access these systems and the data.

IAM systems have onboarded user authentication, access controls, and monitoring tools that are integral in managing the identity of a user from onboarding to offboarding. The organization has a highly distributed workforce or a number of digital services. Centralized management for credentials, roles, permissions, and access policies is necessary.

Role of IAM in the Contemporary Business World

1. Security and Compliance

One of the most critical reasons that companies invest in IAM is security. The risk factors include cyberattacks, data breaches, or unauthorized access. It reduces those risks by ensuring the access of sensitive information only to authorized people.

2.Improves Efficiency

IAM also enables the automation of many processes related to identity administration, user provisioning, role assignment, and de-assignment. This automatically eliminates the involvement of manual interventions, minimizes time consumed when carrying out administrative functions, and ensures uniformity across the organization. Additionally, feature-based self-service for password reset or access requests gives users the autonomy to minimize reliance on IT departments.

3.User Experience

The user experience must be so seamless that it does not impede employee productivity and satisfaction. IAM solutions simplify authentication processes often through SSO in which single credentials can suffice for multiple applications, rather than multiples. Employees need to do this no longer: what helps improve the user experience helps strengthen security in order to encourage stronger password options.

The Business Case for IAM

Now, let's discuss the core business benefits provided by IAM, before going into the calculations about ROI:

1.Cost savings through automation:

Through access management automation, businesses save on the manual-based processes. User account provisioning and de-provisioning can take less time than its counterpart, which involves manual provisioning and de-provisioning, conserving labour hours. IAM also reduces the dependence on helpdesk support in any area concerning password management - one of the most common requests coming from the IT department.

2.Reducing the Chances of Data Breaches

A breach of data incurs a very huge financial cost. For instance, in the United States, the average cost of a data breach is $9.48 million, reports IBM in the 2023 report. Preventing unauthorized access reduces the chances of breaches and the steep penalties, litigation expenses, recovery costs, as well as reputational damage that are associated with IAM systems.

3.Regulatory Compliance

Violation of data privacy laws can result in huge fines. IAM systems allow businesses to have the tools they require in maintaining compliance by enforcing access policies, audit trails, and only allowing individuals with authorized access to regulated data.

4.Increased Employee Productivity

This efficiency, in IAM systems, directly translates to employee productivity. Lower friction means employees spend less time working on solving password issues or making requests for access and more time on their actual work. These workflow improvements will increase the total business productivity.

Calculating the ROI of an IAM Solution

Calculate the IAM system's return on investment - the quantifiable and intangible benefits. This is a step-by-step process for calculating ROI:

Step 1: Identification of Direct Costs

Direct Costs:?Implementation: This is what involves the IAM software, hardware, and any services you need to get the system up and running.

Maintenance Costs: These costs refer to the operating costs that are there to keep the IAM system operational. They would include support, upgrades, and manpower.

Training: This might be a cost incurred for training your IT staff and/or end-users how to most effectively use the system.

Step 2: Measurable Advantages

Automation Cost Savings: ?Number of hours saved on processes like user provisioning, de-provisioning, and password reset

Helpdesk Staff Reduction: dollars and percent difference in how much your helpdesk is no longer needed compared to before, due to functionalities like self-service password reset or automated provisioning.

Less Security Incidents: Determine what you would not have lost in terms of fines, law fees, loss in business.

Step 3: Intangible Benefits

Intangibles are tougher to quantify; however, they occupy a critical position in the IAM business case:

Compliance to Regulations: The worth of being compliant is humongous taking into accounts the costs if you could become non-compliant.

Better User Experience: Happy employees are productive assets. Though you cannot put money on it, it can add to your ROI in terms of productivity.

Protection of Reputation: A data breach would damage your company's reputation in the eyes of customers, which is priceless for maintaining customer trust.

Conclusion

IAM does not sit independently as just a security measure; instead, it does provide for cost saving, increased productivity, and better compliance. Sure, the incremental cost investment in IAM solutions sounds to be much; but, if there are payoffs on the longer run in terms of tangible and intangible returns, then even small firms to large multinational corporations do make worthwhile investments using IAM. IAM translates directly into the bottom line for organizations by doing away with the significant headcount required by identity management processes as IAM automates, ensures improvements in security, and compliance with the regulatory requirements.

Determining the IAM ROI will then make it possible for decision-makers to understand it in monetary terms. IAM will then be implemented, planned, measured, and implemented to become that keystone of your organization's security infrastructure and driver of sustainable business growth.

Are you ready to invest in the future of your organization with the Identity and Access Management solution? With AskMeIdentity you get IAM solutions tailored around an improvement in security, efficiency, and compliance to further underpin all the services you receive. We would welcome the chance to discuss how IAM can deliver a strong ROI for your business. Contact us today for a free consultation.

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