Cloud-Based vs. On-Prem IAM

Written by Kayla Coco-Stotts on January 15, 2020

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Why Do We Need IAM?

The concept of modern identity and access management (IAM) was introduced alongside the LDAP protocol in the early 1990s. This protocol would serve as the stepping stone for on-prem IAM solutions like Microsoft® Active Directory® (AD), which allowed IT admins to authenticate and authorize users to their host of Windows® resources.

Regarding workplace productivity, IAM solutions are essential for IT departments that want to securely connect users to the resources they need. Below we’ve outlined a few benefits of IAM and analyzed whether those benefits are better served through the cloud or on-prem.   


Maintaining secure IAM has become vital to organizations both large and small, as both the frequency and type of cyberattacks have steadily increased since the introduction of the cloud in the late 1990s. In fact, approximately $5.3 trillion in global value will be at risk as a result of cyberattacks from 2019-2023. 

Since the introduction of on-prem infrastructure, the idea has existed that identities should be housed on-prem; the physical hardware gives a sense of controlled safety. This approach, through potentially more customizable, often leads to critical errors through improper management and maintenance of the IAM infrastructure and potentially even onboarding and offboarding procedures. Instituting weak onboarding and offboarding procedures invites security risks like shadow IT. IT departments are responsible for authenticating the right people to the right resources, and if that’s not properly optimized, organizations are at risk.

Most security breaches happen as a result of user error, but cloud-based IAM can help in sharing the security responsibilities organizations face. This means cloud IAM vendors are actively taking action to make their cloud-based IAM more secure. Through password policies, multi-factor authentication, and password managers, security can be delivered ‘as-a-Service’. 


The idea of a maintenance-free IT environment is huge for organizations looking to move their IAM infrastructure to the cloud. With on-prem AD, admins were responsible for implementing all hardware, software, security, VPNs, load balancing, and more. For those that needed additional capabilities to what AD had, then additional solutions were required to be integrated and managed.

IT departments underestimate the cost of maintaining on-prem infrastructure, though (e.g. a missed cost is often the integration necessary between solutions). With cloud-based IAM, cloud vendors get rid of the financial and physical maintenance needed to keep up server rooms. 


The benefit of on-prem infrastructure is that it interweaves a network of people all housed under one roof. Desktop computers, servers, networks, and applications all function under one AD umbrella. However, as modern innovations like the portable computer dominate the technology market, the idea of remote working has become more attractive. 

For example, through on-prem infrastructure, admins are in charge of networking all resources (like remote workers, AWS®, etc.). With cloud-based IAM, the workplace can exist outside of the organization’s four walls. Through VPNs, remote users can securely connect to their network, regardless of their location.

Cloud-Based vs. On-Prem IAM

For large corporations with a firmly engrained on-prem IAM solution, the idea of moving identity management to the cloud sounds like an insurmountable task. However, for organizations of any size, regardless of established routine, cloud-based IAM is more secure, flexible, and oftentimes more cost-effective. A cloud IAM solution is more progressive, supporting a wide range of operating systems, platforms, and providers through one central console. 

Learn More

Interested in modern identity management for modern workplace needs? Check out JumpCloud® Directory-as-a-Service®, the first domainless cloud directory that reimagines the cohesion of on-prem IAM for the modern, cloud-based world.

Kayla Coco-Stotts

Kayla is a content writer at JumpCloud with a B.A. in Print Journalism from the University of Kentucky. She hails from St. Louis, Missouri, and loves to eat good food and hike Boulder's beautiful trails when she is not writing.

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