Beyond Passwords: Modern Identity & Access Management Strategies for Defense Contractors

11 min read

Nov 18, 2025

Why Your Password Policy Isn't Enough Anymore

If you think cybersecurity begins and ends with requiring employees to change their passwords every 90 days, we need to talk. While strong passwords remain an essential component of cybersecurity, they're just one piece of a much larger puzzle called Identity and Access Management (IAM). For defense contractors, manufacturers, healthcare organizations, and pharmaceutical companies handling sensitive data, modern IAM strategies aren't just best practices—they're compliance requirements and business imperatives.

The stark reality is this: weak or stolen passwords remain a primary entry point for cyber attackers. According to a 2024 Forbes Advisor survey, more than 75% of respondents reported that their personal data was taken from hacked accounts. But here's the critical insight that many organizations miss: even perfect password hygiene won't protect you if your overall access management strategy has gaps.

For organizations pursuing CMMC certification or maintaining NIST 800-171 compliance, implementing robust IAM practices isn't optional. The question isn't whether you need modern IAM strategies—it's how quickly you can implement them before your next audit or, worse, your next breach.

What Is Identity and Access Management?

Identity and Access Management is the framework of policies, processes, and technologies that ensures the right individuals access the right resources at the right times for the right reasons. Think of it as your organization's security gatekeeper, determining not just who can enter your digital environment, but what they can do once they're inside.

Modern IAM goes far beyond traditional username-and-password authentication. It encompasses:

Authentication: Verifying that users are who they claim to be
Authorization: Determining what authenticated users are permitted to access
Access Control: Enforcing authorization policies across your systems
User Provisioning: Managing the lifecycle of user accounts from creation to deletion
Privileged Access Management: Controlling and monitoring access to your most sensitive systems and data
Audit and Compliance: Tracking and documenting access events to demonstrate regulatory compliance

For defense contractors and organizations handling Controlled Unclassified Information (CUI), these IAM components directly support multiple NIST 800-171 and CMMC requirements. Without proper IAM, achieving and maintaining compliance becomes exponentially more difficult.

The Foundation: Multi-Factor Authentication

Let's start with the most critical upgrade to basic password security: Multi-Factor Authentication (MFA). In the context of CMMC compliance, MFA isn't a suggestion—it's a requirement for Level 2 certification. If your policy requires multi-factor authentication for all users, but your technical setup only enforces MFA for administrators, this discrepancy must be addressed immediately.

MFA adds additional verification steps beyond just a password, typically requiring:

Something you know (password or PIN)
Something you have (smartphone, security token, or smart card)
Something you are (biometric verification like fingerprint or facial recognition)

The security improvement is dramatic. Even if a cybercriminal obtains a user's password through phishing, brute force attacks, or data breaches, they still can't access your systems without that second factor of authentication.

Implementing MFA Effectively

When implementing MFA, consider these best practices:

Apply MFA universally: Don't just protect administrator accounts—require MFA for all users accessing systems with FCI or CUI
Choose appropriate methods: For defense contractors, ensure your MFA solution meets FIPS compliance requirements for CMMC
Plan for backup authentication: Have procedures for when users lose access to their MFA device
Monitor and enforce: Use endpoint management tools to verify that MFA is consistently applied across all relevant access points

Remember that having a policy requiring MFA means nothing unless you have corresponding technical controls that actually enforce that requirement. This alignment between policy and practice is exactly what CMMC assessors will be looking for.

Role-Based Access Control: Your Crown Jewels Need Protection

Here's a scenario every organization should consider: Do all your employees really need access to all your data? The answer, of course, is no. This is where Role-Based Access Control (RBAC) becomes essential.

RBAC is a method of restricting system access based on a person's role within your organization. Instead of manually configuring permissions for each individual user, you define roles (like "Engineer," "Project Manager," or "Finance Staff") and assign permissions to those roles. Users then inherit permissions based on their assigned role.

For example, having a policy restricting access to sensitive files is meaningless unless you have technical controls like role-based access control systems to enforce that restriction. When policies and controls are in sync, they create a robust, proactive, verifiable cybersecurity environment.

Privileged Access Management: Securing Your Most Sensitive Resources

Within your RBAC framework, certain roles will require elevated privileges—access to critical infrastructure, configuration settings, or highly sensitive data. This is where Privileged Access Management (PAM) becomes crucial.

Privileged accounts are the "crown jewels" cybercriminals target because they provide the keys to your kingdom. A compromised administrator account can:

Access all systems and data
Modify security settings
Create backdoor accounts
Exfiltrate sensitive information
Cover tracks by deleting logs

PAM strategies should include:

Just-in-Time Access: Granting elevated privileges only when needed and automatically revoking them after use
Session Recording: Monitoring and recording all privileged sessions for audit purposes
Approval Workflows: Requiring authorization before granting privileged access
Credential Rotation: Automatically changing privileged account passwords on a regular schedule
Privilege Separation: Ensuring even IT staff use standard accounts for routine tasks and only elevate when necessary

Consider a real-world scenario: A defense contractor implements a policy requiring that all portable devices containing Controlled Unclassified Information (CUI) be encrypted. By deploying encryption software across all devices and using endpoint management tools to monitor compliance, the contractor enforces the policy and generates verifiable evidence for audits. This alignment between policy and technical controls ensures that the organization is prepared for CMMC assessments and remains compliant over the long term.

The same principle applies to privileged access—your policies must be backed by technical controls that enforce and document compliance.

Detecting Abnormal User Behavior: The New Frontier

Even with perfect authentication and authorization in place, insider threats and compromised credentials remain risks. This is where User and Entity Behavior Analytics (UEBA) comes into play—the practice of establishing baselines for normal user behavior and alerting on anomalies.

UEBA systems can detect patterns such as:

Users accessing data they've never touched before
Login attempts from unusual locations or at unusual times
Rapid file downloads suggesting data exfiltration
Privilege escalation attempts
Unusual patterns of failed login attempts

For organizations subject to CMMC requirements, this aligns with the incident detection and response capabilities required at Level 2 and above. Your Incident Response Plan should include procedures for investigating and responding to these behavioral anomalies.

The CMMC Compliance Connection

For defense contractors, every IAM decision intersects with CMMC compliance requirements. Let's map key IAM components to specific CMMC practices:

Access Control (AC)

CMMC requires organizations to:

Limit system access to authorized users and processes
Limit system access to the types of transactions and functions that authorized users are permitted to execute
Control the flow of CUI in accordance with approved authorizations
Separate the duties of individuals to reduce the risk of malevolent activity
Employ the principle of least privilege

Your RBAC implementation directly addresses these requirements. But remember: policies set the standard for cybersecurity, but without corresponding technical controls, they remain intentions.

Identification and Authentication (IA)

CMMC mandates:

Identifying system users and processes
Authenticating the identities of users and processes
Using multifactor authentication for local and network access to privileged accounts

This is where your MFA implementation becomes critical. NIST no longer requires passwords to include special characters or numbers—passwords can contain any ASCII character, including spaces and emojis. However, NIST does recommend passwords should be at least twelve characters long, with a maximum length of 64 characters.

Audit and Accountability (AU)

CMMC requires organizations to:

Create and retain system audit logs to enable monitoring, analysis, investigation, and reporting of unlawful or unauthorized system activity
Ensure that actions of individual users can be uniquely traced

Your IAM system must generate and preserve audit trails showing who accessed what resources, when, and what actions they performed. This documentation demonstrates that your security practices are consistently implemented and maintained—exactly what assessors need to see.

Building Your Modern IAM Strategy: A Practical Roadmap

Based on defense-grade cybersecurity principles, here's how to build a comprehensive IAM strategy:

1. Conduct a Comprehensive IAM Assessment

Start by mapping your current state:

Who has access to what systems and data?
How are users authenticated?
What authorization model is in place?
Where are the gaps between your policies and technical controls?
What audit trails exist?

For organizations pursuing CMMC certification, this assessment should align with your gap and risk analysis.

2. Implement Strong Authentication

Deploy MFA across all access points to systems containing FCI or CUI
Ensure MFA solutions meet FIPS compliance requirements
Establish backup authentication procedures
Use strong password requirements: at least 12 characters, avoiding personal information
Consider implementing a FIPS-compliant password manager for your organization

3. Design and Deploy RBAC

Define roles based on actual job functions
Apply the principle of least privilege—users should have only the minimum access necessary
Map each policy requirement to specific technical controls within your environment
Document role definitions and permission assignments for audit purposes

4. Establish Privileged Access Management

Identify all privileged accounts in your environment
Implement approval workflows for privilege elevation
Deploy session recording for privileged access
Establish automated credential rotation
Separate duties to prevent any single individual from having excessive control

5. Enable Continuous Monitoring

Implement logging for all authentication and authorization events
Deploy behavioral analytics to detect anomalies
Establish clear notification and communication procedures for suspected incidents
Integrate IAM monitoring with your broader Security Information and Event Management (SIEM) strategy

6. Document Everything

Clear documentation serves as the cornerstone for a comprehensive understanding of compliance requirements. For CMMC purposes, you need evidence that supports your policies and technical controls, such as:

Screenshots of configuration settings
System logs showing authentication events
Audit trails of access requests and approvals
Configuration reports from your IAM systems

This documentation demonstrates that your security practices are consistently implemented and maintained.

7. Conduct Regular Reviews and Updates

Cybersecurity and compliance requirements are dynamic. Conduct periodic reviews of your policies and technical controls to ensure they stay aligned as new threats, technologies, and regulatory changes emerge. Regular updates are crucial to maintaining this alignment and ensuring that your organization remains audit-ready and compliant.

Common IAM Pitfalls to Avoid

Even well-intentioned organizations make these mistakes:

Orphaned Accounts

When employees leave or change roles, their accounts often remain active with their original permissions. Establish clear user provisioning and deprovisioning procedures to eliminate this risk.

Excessive Permissions

"Permission creep" happens when users accumulate access rights over time as they move through different roles. Regular access reviews can identify and remediate excessive permissions.

Misalignment Between Policy and Practice

If your policy requires multi-factor authentication for all users, but your technical setup only enforces MFA for administrators, this discrepancy must be addressed immediately. Policies should reflect the implemented controls, leaving no room for ambiguity or conflicting information.

Inadequate Audit Trails

Documentation acts as a trail of breadcrumbs, enabling organizations to trace their compliance efforts. Every action, policy, or procedure must be documented, establishing accountability throughout the organization. This traceability is crucial for audits and assessments, demonstrating a commitment to compliance over time.

Neglecting Third-Party Access

Contractors, vendors, and partners who access your systems must be included in your IAM strategy. Their access should be:

Time-limited to the duration of the project or relationship
Restricted to only the systems and data they need
Monitored and audited like employee access
Immediately revoked when the relationship ends

The Business Case for Identity-First Security

Beyond compliance requirements, modern IAM delivers tangible business benefits:

Reduced Risk of Data Breaches

With proper IAM controls, even if credentials are compromised, the damage is contained. MFA prevents unauthorized access, RBAC limits what attackers can reach, and behavioral monitoring detects suspicious activity quickly.

Operational Efficiency

Automated provisioning and deprovisioning reduce IT workload. RBAC makes it easy to grant appropriate access as employees join or change roles. Self-service password reset capabilities reduce helpdesk burden.

Improved User Experience

While security and convenience often seem at odds, modern IAM solutions like single sign-on (SSO) actually improve user experience by reducing the number of passwords employees must remember while increasing security.

Competitive Advantage

For defense contractors, CMMC certification is becoming a prerequisite for DoD contracts. Organizations with mature IAM practices can achieve certification faster and more reliably, positioning themselves to compete for lucrative government contracts.

Enhanced Trust

Customers, partners, and regulators increasingly expect organizations to demonstrate robust security controls. A mature IAM strategy signals that you take data protection seriously.

The Role of Password Managers in Your IAM Strategy

Even with MFA and RBAC in place, passwords remain part of your security ecosystem. Let's face it: remembering passwords, even if they're only 12 characters long, is difficult. And then you also need a unique password for every account? No one can memorize all of that.

Password managers can securely store complex passwords, making it easier to manage multiple accounts without compromising security. You memorize one really awesome and long passphrase, and then the password manager remembers the rest.

However, it's essential to choose a password manager that meets compliance standards. For CMMC compliance, a password manager must be FIPS compliant. Different password managers have achieved different compliance standards:

NordPass: HIPAA compliant, SOC 2 Type 2 certified, meets ISO 27001 certification standards, but is not FedRAMP certified
Keeper: HIPAA, ISO 27001, and SOC 2 certified, in addition to being FedRAMP certified

When selecting a password manager for your organization, verify it meets the compliance standards relevant to your industry and contracts.

IAM and Your Incident Response Plan

Your IAM strategy and Incident Response Plan must work together seamlessly. When an incident occurs, clear roles and responsibilities must be established. Your IRP should outline who is responsible for different tasks during an incident, such as investigation, communication, and system restoration.

IAM supports incident response by:

Providing audit logs that help investigate security events
Enabling rapid deprovisioning of compromised accounts
Documenting who had access to affected systems
Facilitating privilege escalation for responders who need elevated access during the incident

Notification and communication procedures should define how to communicate with stakeholders, including employees, customers, and regulatory bodies, during an incident. Your IAM system can help identify which users might be affected and need notification.

Taking Action: Your Next Steps

Modern IAM isn't built overnight, but every journey begins with a single step. Here's how to get started:

Assess Your Current State: Where are the gaps between your IAM policies and actual practices?
Prioritize Based on Risk: Focus first on systems handling CUI, privileged accounts, and areas with known vulnerabilities
Start with Quick Wins: Implementing MFA for administrator accounts can often be accomplished quickly and provides immediate security improvement
Plan for Compliance: If you're pursuing CMMC certification, ensure your IAM roadmap addresses all relevant requirements
Partner with Experts: Working with an organization that provides CMMC implementation consulting services can assist in identifying gaps and providing mitigation strategies

At Dragnet, we understand that achieving robust IAM while maintaining CMMC compliance can feel overwhelming. Our team includes Registered Practitioners (RPs) and Certified CMMC Professionals (CCPs) who can help you build an IAM strategy that protects your organization and satisfies compliance requirements.

The Bottom Line

Passwords alone won't protect your organization in today's threat landscape. Modern Identity and Access Management strategies—combining strong authentication, role-based access control, privileged access management, and continuous monitoring—create multiple layers of defense that protect your most sensitive resources.

For defense contractors, manufacturers, healthcare organizations, and pharmaceutical companies handling sensitive data, these IAM practices aren't just security best practices—they're compliance requirements that directly impact your ability to compete for contracts and maintain operations.

The synergy between written policies and technical controls is where true CMMC compliance lies. Policies set the standard for cybersecurity, but without corresponding technical controls, they remain intentions. When policies and controls are in sync, they create a robust, proactive, verifiable cybersecurity environment.

Ultimately, technical controls bring your cybersecurity policies to life, ensuring that your security objectives are actively upheld and documented—a critical requirement for passing CMMC audits and securing your position in the defense sector.

Don't wait for a breach or a failed audit to discover gaps in your IAM strategy. The time to act is now.

Ready to strengthen your Identity and Access Management strategy? Contact Dragnet's team of cybersecurity experts for a comprehensive IAM assessment. We'll help you identify gaps, implement controls, and prepare for CMMC certification—all while protecting your organization from evolving cyber threats.

Schedule a Security Assessment | Learn More About Our CMMC Services

Dragnet delivers defense-grade cybersecurity solutions to midsize enterprises across defense contracting, healthcare, manufacturing, and pharmaceutical industries. Our comprehensive services include Gap & Risk Assessments, CMMC Program Management, Penetration Testing, and Policy & Procedure Development—ensuring your organization maintains robust security while achieving compliance.

Topics: Cybersecurity