Identity centric technologies have undergone a significant transformation in recent times. Gone are the days when it was all about logging in and out of any given system. Today, identity has become the backbone of all digital enterprises. It’s the ‘invisible engine’ that powers everything. From security to how modern-day products are sold. Today’s Identity based frameworks not only controls who can access what, how and when, they also help businesses work efficiently, improves customer satisfaction and reduces fraud and risk, especially associated with back-office jobs. In this article, we’ll look at why identity is key and how it supports several key aspects of digital transformation . Identity is the new security boundary Traditionally, enterprises used firewalls and internal network policies to protect themselves against any external attacks. If you were inside the company network, then trust was automatically granted. If you were not, you were perceived as a threat. That world no longer exists. Because, unlike in the past, companies have employees working from different geographic locations or work from home. Most systems are hosted in the cloud . Customers can access services from mobile devices. And even programs and bots require access to the system. This means that identity is the new perimeter. And traditional methods of securing systems won’t work anymore, as there’s no clear definition of who is ‘inside’ or ‘outside’ the perimeter anymore. Instead of relying on location to grant access, verification is performed on the person or system making the request, and subsequently authorization checks are performed to allow the requested action. Managing user access is not easy at an enterprise scale. And it doesn’t get any easier for those using complicated network rules and manual setups. In fact, it often results in errors and delays. This is where identity-based solutions come into play. When someone from any team logs in, the identity system will accurately pinpoint: Who they are and what they are up to. The project they are working on. Which environment should they use? Using this information, the system can determine which resource someone needs, when they need it and how to use it. The principle behind it is ‘never trust, always verify’. With it, errors that normally occur are reduced, less manual configuration is required and overall efficiency and accountability increase. When something goes haywire, it becomes easy for the enterprise to track which resource was accessed by whom and when. This helps teams move faster without losing control. How identity helps software teams work faster Software is usually managed in various stages during its creation. To do this effectively, companies have different test environments , such as: Development Testing Staging Performance testing For all these environments, we’ve got different teams working simultaneously on the same software. For example, when development teams are working on building new features for the software, business users would be validating the beta version in the parallel testing environment. Modern Identity structure easily carries this context in the message and helps route transactions to the appropriate environment. Identity helps to control exactly what people can see and do Every organization has its own hierarchical structure. Within it, everyone has limitation to what they can access or see. For instance, a junior officer cannot have the same privileges as a manager. Similarly, a manager cannot have the same authorization as the CEO. If everyone had the same access, it would create a serious security risk. This is where modern identity systems shine. It stores information about users based on department, job description, location, level of responsibility and whether the user has special permissions. When logging in, this information travels with them. The application uses this to determine which information to disclose and which to restrict. Put simply, some users see certain menu options while others using the same system can’t see them at all. Similarly, others might have the ability to read and write data, while others can only view it. This is what is known as fine-grained access control , where access is given to users when they truly need it. Some of its benefits are: Enhanced security against internal misuse of data. Reduced data leaks. Makes it easy to comply with data protection laws. Auditing and filing of reports are simplified. Beyond security: Identity powers customer personalization Identity goes beyond just managing employee access. It helps the business grow as it manages crucial customer profile information such as preferences, purchase history, product interest and consent for data use. The data collected is used to market personalized products, send relevant offers, show content based on previous browsing history and even communicate in their customer’s preferred language. Before customer identity management systems , all this information was scattered across different systems. One database could handle emails, another purchase history and another might track website visits. With unified identity management, all this information is summarized under one customer. This translates to better customer experience, higher conversion rates, increased customer loyalty and better marketing. Plus, when customers see how their data is being handled, they are more likely to trust the brand and give permissions for their data to be used. Identity reduces risk and prevents fraud in finance This is where identity is needed the most because financial institutions, such as banks, deal with sensitive information and large amounts of money. Any slight error in processing data could easily incur huge losses and serious repercussions to the institution. In many cases, most customers usually have multiple accounts: Savings account Credit card Mortgage Investment account Business account All these accounts usually exist in different systems. With centralized identity systems , they can all be linked using a single identifier and traced back to one verified customer. This creates a complete financial picture of the customer. Better risk assessment With a clear picture, banks can make informed decisions, which in the long run helps reduce losses. We’re talking about smarter lending decisions, better assessment of risks, income and debt, repayment history, just to mention a few. Stronger fraud detection For any business to stand a chance against sophisticated modern cyberattacks like fraud, early detection is key. With AI-based identity security, detection takes place in real time. So, when someone makes a transaction, the system cross-checks with information such as login location, device type, behavioral patterns and transaction history. If an issue arises during this time, the system can either request extra verification or block the transaction entirely. Detecting fake identities Criminals today are evolving almost at the same pace as technology. To avoid detection, some of them create fake identities by mixing real and false information. Without strong security measures in place, most of them usually get away with it. To prevent this, identity systems based on vast information collected can be able to tell what ‘normal’ looks like for each customer and what doesn’t make sense. For example, when one personal number is linked to multiple unrelated accounts. Building identity as core infrastructure To support the areas this article talked about, it’s crystal clear that organizations can’t just treat identity as an old-fashioned list of names. It must be woven within the very foundation of the business. Here are three golden rules to make that happen: 1. It must be ‘real time’ The system should always share updates whenever they occur. For example, when a user logs in or changes their privacy settings, the information should be propagated throughout the entire system so that other parts of the company can react. 2. It must be easy to integrate with other systems They should be like plug-and-play tools that allow developers to easily connect with others without necessarily needing any assistance from a specialist. 3. It must be built for governance Not everyone needs to have unlimited access to the system. Each organization needs to have a clear set of rules on who gets access to what and when. On top of that, these permissions need to be reviewed from time to time, and all the activities tracked. This not only ensures the company stays safe but also complies with the law. Identity is the foundation of modern business Time and time again, most people often associate digital transformation with advanced new technology. But it’s not just about that. It involves connecting systems, data and the people using these resources smartly and securely. Identity makes this possible. It ensures that only the right users access the right resources at the right time. With identity, software developers are creating and deploying applications much faster, organizations get to control access to sensitive information, businesses can create personalized customer experiences and banks can detect and manage fraud right before it occurs. Therefore, as more businesses continue their migration towards digital transformation, identity needs to be established as the foundation. Those who do this are better positioned to grow, innovate and compete in this digital age . This article is published as part of the Foundry Expert Contributor Network. Want to join?