Shadow IT

Why is shadow IT important to manage?

Managing shadow IT is important because unapproved technology can create serious risks. The IT department cannot check or protect tools that are not approved. If employees use unknown software, private data may be at risk.

Many organizations face these risks every day. Shadow IT accounts for more than half of daily software usage in most companies. 

Data security rules must be followed. When employees use unapproved tools, information may be stored in the wrong place. Work can also become harder when teams use different tools. Some systems may not work together, contributing to organizational tech sprawl. Setting clear rules and checking what employees use helps prevent problems. 

A planned approach allows employees to work safely while keeping the organization protected.

What are the goals of managing shadow IT?

Managing shadow IT helps organizations stay secure, follow rules, and improve efficiency.

Let’s look at the main goals of managing shadow IT:

Strengthening security

• Lowers the risk of cyber attacks from unapproved tools.
• Stops sensitive data from being stored in unsafe locations.
• Ensures IT teams can track and protect all technology used.
• Reduces the chances of expensive data breaches.

Maintaining compliance

• Helps the organization follow data protection laws.
• Lowers legal risks linked to unapproved software.
• Prevents confidential data from being shared improperly.
• Ensures the business meets industry security rules.

Improving operational efficiency

• Ensures all teams use tools that work well together.
• Reduces confusion from employees using different platforms.
• Allows IT teams to give proper support for approved software.
• Helps businesses make better technology choices.

Who is involved in preventing shadow IT?

Preventing shadow IT requires teamwork inside and outside the organization. Each group helps track, manage, and reduce the use of unapproved tools.

Internal stakeholders

• IT teams: Monitor technology and make sure only approved tools are used.
• Security officers: Find risks and stop data leaks before they happen.
• Compliance teams: Check that employees follow rules and use safe software.
• Executives and leadership: Create policies, approve budgets, and support IT teams.
• Department managers: Help employees use the right tools and report any issues.
• Employees: Follow company rules, report problems, and ask for approved tools.

External stakeholders

• Software vendors: Offer secure tools that reduce the use of unapproved software.
• Regulatory bodies: Set legal rules and check if companies follow them.
• Consultants and auditors: Find security problems and suggest fixes.
• Industry experts: Share advice on managing risks and improving security.
• Cloud service providers: Provide safe platforms that replace risky tools.

What is required to avoid shadow IT?

To prevent shadow IT, organizations must take a proactive approach. Focus on clear policies, better technology access, and ongoing employee education.

Establish clear policies and enforcement

Set strict rules on which tools employees can use and how new software gets approved. Make sure all departments understand the risks of using unauthorized technology. Enforce policies with regular checks and clear consequences for breaking them. Keep policies updated as technology and security risks change.

Provide secure and accessible approved tools

Offer employees the tools they need to work efficiently within approved systems. Implementing digital adoption solutions can make IT-approved software easier to access and better meet business needs. If employees find existing options too slow or restrictive, work with them to find better solutions. Ensure technology keeps up with workflow demands to reduce the temptation to use outside tools.

Educate employees on risks and alternatives

Train employees to recognize security risks and understand the impact of shadow IT. Show them how to request new software properly instead of finding unapproved solutions. Keep training ongoing with updates on security threats and best practices. Make education a regular part of IT and security initiatives.

Why do attempts to prevent shadow IT fail?

Many organizations struggle to control shadow IT despite having policies and security measures. Common challenges make prevention difficult, leading to security risks and inefficiencies.

Lack of clear policies and enforcement

Unclear policies leave employees unsure about which tools they can use. If rules are too restrictive, teams may bypass them to work more efficiently. IT teams often lack the resources to monitor every tool in use. Without clear guidelines and strong enforcement, shadow IT continues to grow, making security control harder.

Limited access to approved technology

Employees turn to shadow IT when official tools are slow, difficult to use, or don’t meet their needs. These digital adoption challenges often push teams to seek faster alternatives when approval for new software takes too long. Poor communication between IT and other departments makes employees unaware of approved options. Without better technology access, shadow IT remains a problem.

Failure to educate employees on risks

Many employees don’t realize shadow IT creates security risks. If training is not a priority, they may assume unapproved tools are harmless. Blocking unauthorized software without explaining the risks does not change behavior. Ongoing training, clear guidance, and open communication help employees understand why shadow IT is a threat.

Shadow IT use cases

Shadow IT often appears when official systems are slow, difficult to use, or missing key features, leading to employee frustration that drives them to seek outside solutions.

Below are three examples of how shadow IT appears, how it is removed, and the results.

Financial services

Scenario: A finance team struggles with outdated reporting software that slows down data analysis. To speed up their work, employees start using a free third-party analytics tool without IT approval.

Method: IT detects the tool through security monitoring and works with the team to find a secure alternative. They replace the unapproved software with an IT-approved analytics platform that meets security and business needs.

Outcome: Employees access real-time financial data more efficiently while following company security policies. IT maintains control over data protection without disrupting workflow.

Marketing agencies

Scenario: A marketing team needs a better way to share and edit campaign materials. The company-approved system lacks essential collaboration features, so employees start using an unauthorized cloud storage service.

Method: IT audits software use and discovers the issue. Instead of simply blocking access, they introduce a secure collaboration tool that allows file sharing and real-time editing. The marketing team receives training on how to use it.

Outcome: Employees continue working efficiently with an approved system. Client data stays protected, and IT gains visibility over shared files without limiting collaboration.

Healthcare

Scenario: Doctors and nurses find the hospital’s messaging system too slow for urgent communication. To coordinate patient care faster, they start using personal messaging apps, risking patient data security.

Method: IT identifies the issue through staff feedback and network monitoring. They implement a secure, healthcare-compliant messaging platform designed for medical teams and ensure all staff transition to the new system.

Outcome: Staff communicate quickly without putting sensitive patient data at risk. The hospital remains compliant with data protection laws, and IT prevents future use of unsafe messaging apps.