Are You Safely Sharing Passwords with Employees?

Over 80% of data breaches are caused by compromised (breached or stolen) passwords, which makes them one of your Cybersecurity team’s biggest headaches. Hackers get in using stolen, weak, or reused (and easily breached) passwords.

While there are alternatives like Passkeys, passwords are still predominant and necessary for security. They may eventually be replaced by technologies like biometrics or passkeys, but we’re not fully there yet. We use them for websites, apps, and more. As a result, companies need a secure way to share passwords with employees. They must also help them manage those passwords more effectively.

The most critical thing in today’s Cybersecurity world is safeguarding sensitive information, as cyber-threats are rampant and growing. Properly managing passwords securely is a top priority. At the same time, employees deal with more passwords than ever. LastPass estimates that people have an average of 191 work passwords.

If you have a system that depends on passwords, how do you safely share them with employees who need access for their work? One solution that has gained popularity in recent years is using password managers.

It becomes hard to see living without a password manager once you’ve used one, so let’s explore the benefits they offer. We'll also delve into why it's one of the most secure ways to share passwords with employees.

Should my business use a password manager?

First, here’s what password managers do: they store all the passwords that employees juggle in a secure digital vault, then open a small window offering to fill in the password when the user reaches an applicable login page. The business versions have setups for separating work and personal passwords and can generate secure passwords for you. They also have special administrative functions so companies never lose a critical password.

So, what are some reasons to consider getting a password manager?

Password Management Becomes Centralized

One of the main advantages of a password manager is the ability to centralize password management. This prevents employees from using weak, repetitive passwords and from storing them in vulnerable places. Instead, a password manager stores all passwords in an encrypted vault. This centralized enhances security. It also streamlines the process of sharing passwords securely within a team.

End-to-End Encryption

Here at ITFIRM.COM, we are known to nag about the use of encryption to protect sensitive data, and the leading password managers provide just that. End-to-end encryption scrambles passwords, turning them into unreadable text when stored and transmitted. This makes it nearly impossible for unauthorized users to access the information.

When you encrypt data, it provides an important extra layer of security when passwords are shared with employees. It helps ensure that the data remains confidential even during transmission.

Features of Secure Password Sharing

Don’t settle for any type of software that’s bargain basement.’ Great password managers typically come with secure password-sharing features. They allow administrators to share passwords with team members without revealing the actual password.

Employees can use the required credentials without seeing the actual characters, ensuring that users do not have direct access to sensitive information. This feature is particularly useful when onboarding new team members or when collaborating on projects that require access to specific accounts.

MFA (Multi-Factor Authentication)

Readers of the ITFIRM.COM blog series have seen multi-factor authentication mentioned often – due to its importance, and many password managers support MFA. This adds an extra and important layer of security. MFA requires two or more forms of verification before accessing an account.

Microsoft states that MFA significantly reduces the risk of unauthorized access lowering the risk by 99.9%. This makes it an essential feature for businesses looking to enhance password security, especially when sharing sensitive information with employees.

Generating Complex Passwords

It takes time coming up with strong, complex passwords, but a good password manager will usually have a built-in password generator. They create strong, complex passwords that are difficult to crack and save them for you. When sharing passwords with employees, employers can use these generated passwords. They ensure that employees are using strong, unique passwords for each account.

By employing this tool, you can preclude the widespread practice of using weak passwords, or the 2^nd deadly password sin: reusing passwords across many accounts. This feature mitigates the risk of security breaches.

In the final analysis, do you want to follow the dangerous path of using the world’s most common password, ‘123456’ - which can be cracked in Less Than a Second – or do you want to use something like ‘ImMLw0&23o&i5Mc’ – which PasswordMonster estimates would take 9 trillion years to crack. Trust me, cybercriminals don’t have that much patience.

Activity Monitoring and Audit Trails

One valuable feature offered by many password managers is monitoring, which provides the ability to track user activity and access history. Admins can track who accessed which passwords and when. This provides transparency and accountability within the organization and is an important forensic tool if something damaging has happened.

This audit trail helps in identifying any suspicious activities. It also allows companies to take prompt action, which ensures the security of the shared passwords.

Third Party Secure Sharing

Often, when third parties are involved in a collaboration, using a password manager is more crucial than ever, offering secure methods for sharing credentials with the third-party collaborators or contractors. Companies can grant these external parties limited access to specific passwords. They can do this without compromising security.

This keeps control of the passwords within the organization.

A password manager means you will never have to worry about losing a password when the only employee who knows it leaves the company.