Identity Lifecycle Management: Importance, Benefits, and Challenges

With the growth in an organization’s business, the workforce also expands. This includes onboarding new employees and off-boarding when employees leave the organization. Effectively managing the employee user accounts and identity and access privileges becomes a tedious task for IT administrators.

Identity Lifecycle Management (ILM) plays an important role in reducing the load on IT operations. It streamlines the whole process, from onboarding to offboarding user accounts, enhancing productivity.

This blog will explain ILM’s concept, importance, phases, benefits, and challenges.

What is Identity Lifecycle Management?

Identity Lifecycle Management (ILM) can be defined as the process of managing user identities and access permissions of employees throughout their term within an organization. It automates and manages the entire digital identity lifecycle process for employees of an organization.

ILM is vital for organizations to secure their information assets while ensuring smooth business operations. A robust ILM solution guards against unauthorized access and improves user experience by streamlining authentication processes and efficiently managing user identities throughout their lifecycle.

Why is Identity Lifecycle Management Required?

Identity Lifecycle Management (ILM) is crucial for maintaining the security and integrity of an organization’s systems and data. It enables IT admins to set up new user rights and access policies instantly without manual configuration. ILM also prevents security breaches and insider threats, protecting the company’s valuable assets and resources.

ILM works on the principle of least privilege. It mitigates risks and ensures users are provided with minimum levels of access needed for their job role. This prevents employees from gaining unauthorized access to resources not required for their position or role in the company.

With ILM, enterprises get a detailed record of who has access to what resources, which makes it easier for them to comply with internal (corporate) and regulatory compliance. For instance, in the healthcare industry, ILM helps hospitals align with compliance, such as HIPAA compliance, by ensuring only designated officials have access to critical patient data.

Most importantly, ILM automates the tedious and error-prone user provisioning and identity governance processes. This boosts employee productivity by ensuring new joiners have immediate access to the applications and IT services they need from day one. Furthermore, ILM reduces the cognitive load of  IT and security staff, enabling them to focus on more critical business tasks.

Benefits of Identity Lifecycle Management

A comprehensive Identity Lifecycle Management (ILM) solution offers numerous benefits for organizations, enhancing security and operational efficiency. Key benefits include:

1. Better Security

ILM enhances security by ensuring only authorized users have access to sensitive company information and resources, subsequently reducing the chances of security breaches. Additionally, it enables IT admins to update or revoke access when an employee changes or leaves a role. This minimizes the risk of external or malicious threats.

2. Operational Efficiency

Enterprises gain operational efficiency through the automated management of digital user identities and accounts. This streamlines access management by configuring access privileges and user roles, ensuring users have the right access at the right time.

3. Improved Compliance

ILM helps organizations comply with various regulatory requirements (such as GDPR, HIPAA, and SOX) by providing detailed user access and activity records. Automated tracking and reporting make preparing for and passing security audits easier.

 4. Enhanced User Experience

ILM’s automated user provisioning leads to faster onboarding. This gives new users immediate access to necessary resources, fostering productivity and focus. Features like Single Sign-On (SSO) reduce the number of credentials users need to manage, making it easier and quicker to access required resources.

5. Scalability

ILM solutions can scale with the organization, handling an expanding workforce’s identity and access management needs without a proportional increase in administrative effort. It ensures identity management policies are applied uniformly, even in large, geographically dispersed organizations.

What Are the Phases of Identity Lifecycle Management?

Identity Lifecycle Management (ILM) primarily aims to ensure that user access to corporate resources is appropriate, efficient, and securely revoked. This aligns the company with the ongoing changes in user roles and status within an organization.

ILM consists mainly of 5 phases to ensure effective and secure management of user identities and access permissions throughout the user lifecycle within an organization. These include:

1. Identity creation

It involves setting up new user accounts, authorizing initial access rights, and provisioning necessary resources, such as official email and application access. IT admins assign the roles based on job functions, ensuring employees have appropriate access from day one.

2. Access Management

Identity access management involves continuous supervision of user access rights. Updating user roles and permissions as job functions change and ensuring access rights align with current responsibilities are all a part of the access management phase.

3. Auditing and Compliance

During an employee’s duration in an organization, user activities must be constantly tracked to detect unauthorized behavior. Moreover, regularly reviewing access logs and user privileges ensures alignment with security policies and regulatory compliance.

5. De-provisioning

When an employee leaves the organization, IT admins can deactivate the user account and withdraw all the access privileges and permissions given to that employee. This retains and safeguards the organization’s data from leaking or being misused.

Challenges of Identity Lifecycle Management

Implementing and maintaining an effective Identity Lifecycle Management (ILM)  presents several challenges. Here are some key challenges:

 1. Determining Data Retention Periods

One of the biggest challenges with Identity Lifecycle Management (ILM) is determining how long to keep different types of data and when it’s no longer needed. Retaining user data and logs for a huge workforce can be complicated for organizations. Enforcing effective data retention policies can balance legal obligations, business needs, and storage costs.

Poor data management can lead to keeping data longer than necessary, which increases storage costs and potential security risks. Moreover, disposing of data too soon can lead to compliance issues and the loss of valuable information. This makes it crucial for enterprises to adopt robust data governance policies and automated systems to manage data lifecycles efficiently.

 2. Data Classification and Compliance

Properly classifying and categorizing data for data security and regulatory compliance is difficult and expensive. Organizations handle vast amounts of data, each with different security and compliance requirements. Inaccurate or incomplete data classification can result in security vulnerabilities and non-compliance with regulations such as GDPR, HIPAA, and CCPA.

These lapses can lead to severe legal and financial penalties, as well as damage to the organization’s reputation. Ensuring data is accurately classified and protected requires continuous monitoring, updating classification schemas, and investing in advanced data management tools, which can be resource-intensive.

 3. Storage Costs and Management

Large amounts of data can increase storage costs over time. As the amount of data increases, organizations must invest in scalable data storage solutions while ensuring data remains accessible and secure. Poor storage management wastes resources and makes it difficult to retrieve critical data when needed.

Balancing the need for high-performance storage with budget constraints requires strategic planning and using technologies such as data deduplication, tiered storage, and cloud-based user lifecycle management solutions. Additionally, implementing policies for archiving and disposing data helps optimize storage costs.

 4. Managing External Users

Managing digital identities for contractors and seasonal employees, who may not be included in the organization’s HR management system (HRMS), is a significant challenge for Identity Lifecycle Management (ILM). These external or temporary workers still need their identities and access rights to be set up, monitored, and eventually removed from the IT systems.

The lack of integration between HR and IT software can cause problems when contractors and employees join or leave the organization. Without clear and immediate communication between these departments, productivity delays or serious security gaps can occur due to poorly managed identities and access permissions. To handle these external users effectively, ensuring seamless integration between HR and IT systems is crucial.

 5. Time Management for IT Admins

IT administrators find manually setting up, monitoring, and de-provisioning identities and access time-consuming and inefficient. In addition to these tasks, IT admins are also responsible for password resets, permission updates, and access requests. These repetitive tasks can overwhelm IT teams, leaving them with little time for more strategic, high-priority projects.

Automating these routine ILM processes can significantly improve efficiency, allowing IT staff to focus on critical initiatives that drive business growth and innovation rather than getting bogged down in manual administrative tasks.

 6. Lack of Centralized View

Without a centralized view, maintaining consistent security policies and efficiently managing user access becomes challenging. Different departments may operate independently, leading to fragmented identity management and potential security risks.

A centralized identity lifecycle provides a unified view of all user identities and access rights, enabling better control and oversight. By streamlining the organization’s identity management processes, this approach enhances security and improves operational efficiency.

7. Compliance Visibility into Third-Party Tools

Ensuring compliance and visibility into the use of third-party tools is essential for maintaining organizational security and regulatory adherence. Organizations must know who has access to applications and data, where they access it, and what they do with it. Many advanced services offer limited compliance reporting, often restricted to individual applications.

A comprehensive ILM solution should provide centralized compliance reports, detailed access rights, provisioning and deprovisioning activities, and user behavior across all services. This centralized visibility helps organizations meet regulatory requirements, protect sensitive data, and streamline audit processes, reducing the risk of non-compliance and enhancing overall security.


Effective Identity Lifecycle Management (ILM) in a developing organization is critical for optimizing user identity operations, increasing security, and guaranteeing regulatory compliance. By automating user provisioning and access management, ILM reduces IT responsibilities, mitigates risks, and boosts operational efficiency.

Despite implementation challenges, a robust identity lifecycle management solution is essential for ensuring secure and effective business processes, allowing firms to concentrate on innovation and growth. It provides the necessary framework for secure, efficient, and compliant management of user identities and access privileges, allowing businesses to focus on growth and innovation without compromising security or operational efficiency.

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