The Hidden Costs of IAM Mismanagement: How Inefficient Access Controls Drain Security Budgets

Identity and Access Management (IAM) is meant to safeguard enterprise systems, but when it is poorly managed it often becomes one of the most expensive blind spots in cybersecurity. Misconfigured roles, unused entitlements, and delayed provisioning not only weaken defenses—they silently drain millions from IT and security budgets.

According to a Forrester study highlighted by JumpCloud, the average password reset costs around USD 70, factoring in both IT labor and employee downtime. For a 10,000-employee organization, just two resets per worker each year add up to USD 1.4 million in overhead.

The inefficiency extends well beyond credentials. In Microsoft’s 2024 State of Multicloud Security Report, only 2 percent of the 51,000 permissions granted to human and workload identities were actually used, while half were flagged as high risk. Each unused entitlement adds complexity and creates risk without delivering business value.

Gartner projected that by 2023, 75 percent of security failures would result from inadequate identity, access, and privilege management. That projection has proven accurate as organizations struggle to modernize IAM models that cannot keep up with SaaS adoption, cloud workloads, and non-human identities.

The Sources of Hidden IAM Costs

IAM inefficiencies show up in multiple areas. Each one may seem minor in isolation, but together they become a persistent and expensive burden.

Why Older IAM Models Fail

Traditional IAM systems were designed for centralized networks and predictable roles. That model no longer fits a world of hybrid work, SaaS sprawl, and machine identities.

Common weaknesses include fragmented policy enforcement across environments, static roles that ignore behavioral context, manual lifecycle management that introduces delays and errors, and unmanaged service accounts that create blind spots. Instead of enabling business, these outdated approaches consume budget and expand risk.

How Modern IAM Unlocks Value

Leading organizations treat IAM as a driver of efficiency and resilience rather than an administrative chore. They are embedding automation and analytics to reduce waste and strengthen governance.

Modern identity and access management (IAM) is about replacing static, manual processes with adaptive, automated practices that align security with business agility. Consider a few common pain points and how they evolve when handled differently:

• Password resets: What used to be manual helpdesk tickets now shift to self-service automation, reducing IT workload and giving users faster access.
• Role assignments: Instead of relying on static roles that drift over time, behavior-aware analytics provide risk-adaptive access tailored to context.
• Access entitlements: Rather than granting standing privileges, organizations adopt Just-in-Time access, which narrows the attack surface by eliminating unused rights.
• Access reviews: Manual certifications give way to continuous automated reviews, which streamline compliance and lower audit costs.

In a 2025 article, McKinsey shows that as enterprises shift technology models, 5 to 10 percent of IT productivity gains can be lost due to vendor inefficiencies and poor cost transparency. That highlights how even well-intentioned IT investments can erode value if not managed end to end. (See “The new economics of enterprise technology in an AI world” by McKinsey) 

A Practical Roadmap

Improving IAM does not require starting from scratch. A phased approach delivers quick wins and builds momentum:

1. Audit permissions and entitlements to identify unused or risky access.
2. Pilot Just-in-Time access for privileged accounts.
3. Add behavioral analytics to monitor anomalies beyond static roles.
4. Automate lifecycle provisioning and deprovisioning tied to HR systems.
5. Expand gradually into unified, cross-platform enforcement.

Each phase compounds savings and strengthens resilience, delivering ROI along the way.

How BTA Supports Smarter IAM

At BTA, we help enterprises shift IAM from a hidden cost into a measurable advantage. Our Policy Automation Engine unifies enforcement, integrates behavioral analytics, and automates review cycles across platforms.

It provides:

• Consistent cross-platform policy enforcement
• Real-time anomaly detection through analytics
• Automated, auditable reviews for compliance
• Adaptive provisioning that balances user experience with security

Rather than layering more oversight on top of broken processes, we help organizations uncover inefficiencies and replace them with automation that aligns access with both intent and risk.

What Comes Next

The costs of IAM mismanagement are often buried inside helpdesk budgets, delayed projects, or regulatory findings. Yet they are significant and growing.

Every reset request, dormant entitlement, or provisioning delay diverts resources that could otherwise support innovation. Now picture IAM processes that are seamless, adaptive, and cost-efficient. Instead of draining budgets, identity becomes a foundation for resilience and compliance.

With automation and behavioral intelligence, organizations reduce overhead while minimizing exposure. The first step is visibility: assessing the inefficiencies that are already slowing business down. Once that baseline is clear, leaders can move quickly toward a roadmap that unlocks both cost savings and security gains.

BTA’s IAM team partners with enterprises on that journey, helping design strategies that reduce cost, increase resilience, and capture the real business value of modern identity governance. Contact us today to get started.