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Shadow IT Examples and How to Manage Them

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Shadow IT Examples and How to Manage Them

Shadow IT Examples and How to Manage Them

HC

Admina team

2023/05/02

What is Shadow IT?

In today's fast-paced business environment, employees are constantly looking for ways to streamline their workflows and increase productivity. However, this often leads to the use of unauthorized technology solutions, also referred to as shadow IT.

A report by Gartner found that 30% of successful cyberattacks will come from Shadow IT resources. Meanwhile, Everest Group estimates that shadow IT accounts for up to 50% of IT department expenditures. There's clearly a serious risk associated with the use of this unsanctioned technology in the workplace, and it's costly.

To help organizations address this issue - particularly those who are unfamiliar with it - we first need to understand what an appropriate shadow IT example is. As part of this comprehensive guide, we will discuss shadow IT examples and how to manage them, as well as provide an in-depth look at shadow IT itself.

By following our guide, organizations can develop clear policies and procedures, provide education and training to employees, and implement technology solutions that meet employee needs while maintaining security and compliance.

Let's dive into our guide and start managing shadow IT today.

Source: Pexels

Shadow IT has become a common term in today's fast-paced business environment. Essentially, it refers to the use of unsanctioned technology solutions by employees without the knowledge or approval of the IT department.

Shadow IT can include the use of personal devices for work-related activities, the use of unsanctioned cloud services, and the use of unapproved software applications.

Characteristics of Shadow IT

While the use of these unsanctioned solutions may be driven by the need for increased productivity and convenience, it poses significant risks to organizations in terms of security, compliance, and financial management.

There are several characteristics that are common to Shadow IT:

  • Unauthorized Usage: Shadow IT's utilization is neither sanctioned by the IT department nor the organization, implying that such solutions lack official support and clear policies or guidelines for usage.

  • Limited Oversight: Often, IT departments have little control over Shadow IT solutions, hindering their access to company data, security measures, and other essential features.

  • Security Threats: Employing Shadow IT can introduce considerable risks to an organization's security. These systems might be insecure and devoid of vital safeguards for protecting sensitive information.

  • Regulatory Dangers: Utilizing Shadow IT could also lead to compliance issues as these solutions may not adhere to company policies or industry-specific regulations.

  • Fiscal Hazards: The deployment of Shadow IT may incur additional costs for organizations in terms of software license acquisition, support expenses, and other related charges.

It’s crucial for companies to identify and manage such solutions effectively in order to ensure sensitive data protection and maintain compliance with industry standards.

How Shadow IT Differs from Sanctioned IT Solutions

Recognizing the distinctions between shadow IT and approved IT solutions empowers organizations to manage shadow IT effectively, ensuring that technological solutions are in line with their overarching business goals.

Shadow IT varies from approved IT solutions in numerous ways:

  • Authorization: Approved IT solutions possess organizational or departmental authorization, official support, and specific guidelines for usage.

  • Oversight: The control of approved IT solutions lies within the domain of the organization's respective departments. This enables personnel to access data, security controls, and other essential features of these systems.

  • Security: Generally, approved technologies surpass shadow counterparts in terms of security. These systems are engineered with a focus on safety protocols and necessary safeguards for protecting vital information.

  • Regulatory Adherence: Sanctioned tools comply with company policies and industry regulations while undergoing regular audits for quality assurance and safety measures.

  • Financial Stewardship: Financial viability is maintained by managing sanctioned technology within the appropriate department to align with an organization's monetary objectives.

Creating comprehensive policies concerning tech implementations - alongside encouraging business users and employees to avoid shadow IT risks - are pivotal actions for businesses.

Such efforts will ensure alignment between implemented tools and broader corporate aims while preserving required security levels, compliance standards, and financial management practices.

Source: Unsplash

Examples of Shadow IT

Shadow IT has become a growing concern for organizations. The use of unsanctioned solutions, which employees may turn to in an effort to boost their productivity, can have serious and enduring consequences for the organization.

An outcome of shadow IT is higher expenses, as resources are directed away from authorized technical plans. Furthermore, teams might incur unnecessary expenses for unapproved software usage as they are not familiar with the market and cannot leverage the corporate discounts negotiated by the IT team. This creates a disturbance in the IT procurement process.

The following are examples of shadow IT services and cloud-based applications:

  • Cloud-based file-sharing services such as Dropbox, Google Drive, and OneDrive

  • Instant messaging apps and collaboration tools like Slack, WhatsApp, and Skype

  • Project management tools such as Trello, Asana, and Monday.com

  • Communication and video conferencing tools like Zoom, Microsoft Teams, and Cisco WebEx

Hardware devices can also be utilized with shadow IT in the following ways:

  • Personal smartphones, tablets, and laptops used for work purposes

  • USB drives or external hard drives used to store and transfer work-related data

  • Personal wireless routers used to set up independent Wi-Fi networks in the office

  • Portable printers and scanners used to print or scan work-related documents

It should be noted that these examples are not inherently problematic or unsafe. The issue arises when they are used without proper approval or oversight from the IT department or the organization.

Common Shadow IT Tactics

Whether it is the use of personal devices or unapproved workflows, there are many different tactics that fall under the umbrella of shadow IT.

  • Utilizing personal devices for work: Employees might access work-related emails, calendars, and documents using their smartphones, tablets, or laptops without informing the IT department. This practice poses security risks due to potentially weaker safety measures on personal devices compared to company-owned ones.

  • Employing unauthorized software and cloud services: The use of unapproved software applications or cloud services can lead to compliance issues as they may not align with an organization's data protection or privacy policies.

  • Developing unendorsed workflows and processes: Workers may create custom workflows and processes to enhance productivity without consulting the organization or IT department. Such actions could introduce operational risks if these methods do not adhere to company policies or standards.

  • Unapproved data-sharing practices: Sharing sensitive information with third parties or colleagues without proper clearance can result in privacy violations, compliance concerns, and financial liabilities in case of critical data breaches.

Shadow IT can take many forms and poses significant risks to organizations. By understanding common examples of Shadow IT practices, organizations can take steps to mitigate these risks and ensure that their technology solutions meet their needs while maintaining security, compliance, and financial management.

Source: Pexels

Risks And Challenges Associated With Shadow It

As more organizations embrace digital transformation, the risk of shadow IT continues to grow. Here are the risks and challenges associated with shadow IT:

Security Risks

A major risk of shadow IT is exposing an organization's network to vulnerabilities. Employees utilizing unsanctioned applications or devices might inadvertently introduce malware or other threats, compromising overall security. Unsanctioned solutions can also serve as entry points for cyberattacks or data breaches.

Addressing unauthorized solutions can be challenging, especially if employees remain unaware of associated risks. To combat this issue, organizations must educate staff on secure technology usage and the dangers posed by shadow IT.

Productivity Challenges

Though short-term productivity may improve with shadow IT usage, long-term efficiency could suffer due to insecure tools leading to duplicated efforts, reduced collaboration across teams, and confusion caused by using different applications for similar tasks.

To bypass such hurdles, providing employees with standardized technology solutions that are effective and user-friendly is crucial. This includes granting access control for approved software and tools while offering training sessions and technical support.

Compliance Concerns

Regulatory requirements often dictate the use of specific technology solutions or security measures. Organizations may face legal repercussions if they fail to comply due to unsanctioned solution usage.

To prevent compliance issues, staying informed about relevant regulations and offering employees access to compliant technology solutions is essential. This includes secure file-sharing options, email services, and regular updates with the latest security patches for devices and applications.

Detection and Management Challenges

Detecting and managing unauthorized devices and applications present a significant challenge within shadow IT. Without proper insight into various technology solutions in use, organizations struggle to manage networks effectively.

Proactive steps are crucial in addressing these obstacles: implementing technology-use policies; educating employees on shadow IT risks; utilizing tools like Configuration Management Database (CMDB) for tracking all employed technological solutions within an organization.

Source: Unsplash

Best Practices for Managing Shadow IT

With the right strategies and tools, it is possible to control shadow IT successfully. The following are some best practices for managing shadow IT within your organization:

Education and Awareness Campaigns

Spark curiosity among employees by shedding light on potential risks associated with shadow IT through immersive training sessions, hands-on workshops, or even gamified learning experiences.

Empower staff to make informed decisions by providing them with comprehensive insights into the possible consequences of utilizing unsanctioned technology solutions. In turn, they are more likely to adhere to established policies and guidelines.

Use a Reliable Shadow IT Tool

Adopt cutting-edge shadow IT discovery tools like Admina, our cloud-based management platform that optimizes SaaS app usage while enhancing productivity and keeping expenses in check.

Let Admina unveil hidden instances of shadow IT across multiple channels such as ERPs, accounting software, or browser extensions - all working together seamlessly to ensure organizations can make well-informed technology adoption decisions.

Adoption of Sanctioned Technology Solutions

Foster synergy between business stakeholders and tech-savvy individuals within the IT department as they work together to identify secure solutions tailored specifically to employee needs.

Provide user-friendly self-service access portals for resource requests so employees have a convenient alternative at their fingertips without resorting to unauthorized options.

Regular Monitoring and Risk Assessments

Keep a watchful eye on ever-evolving technology usage trends by conducting regular risk assessments which proactively uncover potential security vulnerabilities entwined with unsanctioned practices lurking beneath the surface.

Collaboration between IT and Business Stakeholders

Bridge gaps between business stakeholders and the IT department so they can collaborate harmoniously in identifying suitable technologies that cater to both operational demands without compromising crucial security measures put in place.

Wrapping Up

Managing shadow IT is essential for organizations to maintain security, compliance, and operational efficiency. By utilizing this guide on shadow IT examples and best practices, organizations will be able to reduce the negative impacts it has on their operations.

Using a reliable shadow IT tool such as Admina can greatly assist in managing SaaS apps and discovering shadow IT within the organization. With the assistance of Admina, businesses can avoid the risks associated with shadow IT and ensure that their technology solutions meet their needs while maintaining security and compliance.

Schedule a free demo today to learn more about the immense benefits we have to offer your organization.

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Shadow IT Examples and How to Manage Them