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ManageEngine has released its Identity Security Outlook 2026 report, revealing critical shifts that are forcing enterprises to fundamentally rethink their identity and access management (IAM) strategies. The study highlights the overwhelming proliferation of non-human identities, a significant gap between AI expectations and execution, and a decisive industry movement toward vendor consolidation to combat unsustainable complexity.
Machine identities (bots, service accounts) now outnumber human identities by a ratio of 100:1 or more.
Only 12% of organizations have automated lifecycle management for these machine identities.
90% of orgs are piloting AI in IAM, but only 7% have organization-wide deployment.
A perception gap exists: 68% of C-suites are bullish on AI for risk modeling, but only 27% of managers find it practical.
Nearly all organizations (82%) are either actively consolidating IAM vendors or evaluating it.
Pain points like governance gaps (49%) are now top investment priorities for 2026.
A central finding of the report is the dramatic scale of non-human identities, which include service accounts, bots, certificates, and AI agents. These identities now dominate the security landscape, with management ratios commonly exceeding 100 machine identities to every human user. Despite this, visibility and governance are severely lacking: while 80% of leaders believe dormant machine accounts are tracked, only half of practitioners confirm this, and a mere 12% have achieved comprehensive automated lifecycle management.
"The machine identity explosion represents identity security's next frontier," said Ramanathan Kannabiran, director of product management at ManageEngine. "When non-human identities outnumber humans by orders of magnitude... traditional governance approaches collapse."
The survey indicates widespread experimentation with AI to address IAM skill shortages and complexity, but operational maturity remains low. While nine in ten organizations are piloting or using AI in IAM, only 7% have achieved organization-wide deployment. A stark perception divide is also evident, with C-suite executives (68%) optimistic about AI for risk modeling, while managers (27) find it impractical, suggesting a disconnect between strategic vision and on-the-ground implementation.
Operational strain from managing fragmented tool sets is driving a powerful consolidation trend. The study found that one in three organizations spends more time managing IAM vendors than managing privileged users. In response, 36% of organizations are actively consolidating platforms, with another 46% evaluating vendor unification. This movement is occurring alongside sustained or increased security budgets, indicating consolidation is a strategic choice for future readiness, not merely a cost-cutting measure.
"What we are witnessing is consolidation becoming the long-term norm for identity security," said Kannabiran. "True consolidation is not about stitching together acquired tools. It is about building a future-ready architecture where every component is designed to work coherently."
The report concludes that identity security is at an inflection point. The combined pressures of machine identity scale, shallow AI integration, and vendor sprawl are aligning challenges with investments, pushing organizations toward unified platforms designed for scalable, automated governance as the defining strategy for 2026 and beyond.
About PAM360
PAM360 is ManageEngine's unified PAM platform that helps IT teams enforce strict governance on access pathways to critical corporate assets. With a holistic approach to privileged access security, PAM360 caters to core PAM requirements and facilitates contextual integration with multiple other IT management tools, resulting in deeper insights, meaningful inferences, and quicker remedies. More than 5,000 global organizations and over one million administrators trust PAM360 with their PAM needs.
About ManageEngine
ManageEngine is a division of Zoho Corporation and a leading provider of IT management solutions for organizations across the world. With a powerful, flexible, and AI-powered digital enterprise management platform, we help businesses get their work done from anywhere and everywhere—better, safer, and faster.
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