Explanation of terms:
Federation (also: identity federation) refers to a trust relationship between several independent identity sources. It enables users to log in securely across organizational boundaries without having to create a new account.
How does Federation work?
Federation is based on open standards such as SAML, OpenID Connect or OAuth 2.0. These protocols enable the secure exchange of identity and authorization information between the systems involved.
There are two roles:
- Identity provider (IdP): Performs the authentication (e.g. Azure AD, Google, Ping Identity)
- Service Provider (SP): Trusts the IdP and grants access to applications or resources based on it
The connection between IdP and SP is configured in advance and is based on mutual trust, hence the term federation.
Advantages of Federation
- Single sign-on (SSO) across system boundaries
Users only have to authenticate themselves once and gain access to several federated services without having to log in again to each system.
- Less password chaos
Users only need one set of access data, which reduces password forgetting, simplifies use and increases security.
- Lower administrative costs
Organizations save on duplicate user maintenance: external identities (e.g. from partners or customers) can be reused without having to create their own accounts.
- Improved cooperation with partners & suppliers
Trusted authentication via federations simplifies access for external parties, for example in projects, supply chains or shared platforms.
- Data protection compliance
Since identity data does not have to be stored or synchronized multiple times, GDPR-compliant processing is easier to implement.
- Uniform safety standards
Within a federation, coordinated authentication and trust levels ("circle of trust") apply, which reduces security gaps and creates a common level of security.
Conclusion:
Federation enables secure and user-friendly logins across systems and company boundaries, without additional user administration.