When you need to authenticate many users across multiple enterprises for security purposes, is Federal Identity Management (FIM) or Single Sign-On (SSO) the right choice? Choosing between these IT security protocols can mean the difference between secure on-premises directories and social networks and costly data breaches for your company.

While SSO and FIM are similar, there is a key differentiator: SSO authenticates a single credential across multiple systems in a single organization, while FIM offers single access to many applications in numerous enterprises.

What is Federated Identity Management (FIM)?

FIM is a multi-trust, user-friendly authentication technique that gives credentials and permissions to those wanting access to your global enterprise’s data. This security protocol allows multiple enterprises with many different subscribers to use the same identification data (federated identity) to access networks available to the group at large. Essentially, a third party vouches for the identity of data-users, a security bridge that exists between your employees and/or customers and you. An on-site active federation trust is established to vouch for people who will potentially interact with your data.

Also known simply as identity federation, this tool must be employed with security measures that ask enterprises to make changes to their existing structures, but its beneficial for several reasons:

  • Employees need only one login to access multiple data sets with FIM. With so many apps needed to carry out everyday activities within a business, users can use one login securely without having to memorize multiple usernames and passwords, or using the same username and password across multiple platforms, which is a huge data security risk. A recent Statista survey revealed that only 22% of people use different passwords for every online login. This is like giving away a key to your front door, and your office, and your car all at once.
  • Customers need access to a bevy of online services, and open SSO identity federation automates security authentication quickly and easily to enhance their experience and drive more sales. From patient portals for online health services to login credentials needed for a favorite monthly meal subscription service, login difficulty can cost sales.
  • Enterprises often need to assign IT projects to teams with varying skill sets. FIM allows data sharing without the risk of security breaches. Virtual jobs are on the rise, and global, fractured IT teams are now becoming the norm. A FIM sign-on allows seamless integration of teams, securely. 
  • Collaboration and sharing of data is possible without having to utilize manual user lists and web-based, proprietary access management tools. FIM reduces both cost and time needed to allocate IT teams for constant manual updates.

What is Single-Sign On (SSO)?

With SSO a data-user can securely authenticate themselves across multiple apps and websites with a single set of credentials.

Here’s how it works: Someone goes to an application they want to use. They receive a security token that contains information about them like their email address, so that the Identity Provider can grant access, based on authentication compared against existing data.

Within an organization, SSO allows users access to on-site applications. This differs from federated identity which externally allows users access to multiple applications across enterprise domains.

While SSOs can be easy to infiltrate by phishing, key logging, and other data-hacking methods since there is a single authentication for hackers to get through, and you are reliant on a SaaS applicant’s multi-factor authentication for security, SSO also comes with its own benefits:

  • SSO reduces login related help-calls and eliminates the need for password resets. Research from Gartner group reveals that up to 50% of calls to help desks are for password resets, and labor for a single call can cost $70.
  • SSO can be less expensive to integrate than FIM since FIM has the cost of building out a third-party authenticator however, multiple enterprises can share a B2B federation to save money and consolidate resources.
  • Many SSO-platforms now have baked-in security integrations with thousands of software applications so one password grants you access to all of them, similar to how a FIM security protocol grants access to multiple enterprises.

Choosing Between SSO and FIM Security

There are benefits to using SSO or FIM, with associated security and financial incentives for each. Each security practice enables authentication of a single user on multiple apps or authentication across multiple enterprises and apps simultaneously. As you decide how to best serve customers and employees across your business or businesses, password creation and user authentication can be streamlined with either of these protocols. See how SailPoint integrates with the right authentication providers.