💡Key Takeaways

  • Shadow IT represents potential security threats, but it also offers untapped opportunities for cost savings and improved efficiencies
  • The best way to tackle shadow IT right away is through Torii SaaS Management Platform—a 14 day free trial of the tool gives you full shadow IT visibility—learn more

In this article, we’ll answer the top questions about Shadow IT like:

Finally, we’ll offer Three Steps To Take in 2024 for Shadow IT

What is Shadow IT?

Shadow IT occurs when someone uses unsanctioned technology or technology resources within the company. For example, someone may use technology services, systems, devices, hardware, applications, or software without the IT department’s knowledge.

Featured Video: What is Shadow IT? [Explainer]

Shadow IT has been around as long as computers have been a part of modern organizations.

What is Wrong with Shadow IT?

It depends on who you ask! For the IT department and security/compliance teams, Shadow IT can represent a threat to the organization’s security. More unsanctioned technology means less control and more exposure to risk from accidents, user errors, and bad actors.

However, for many professionals throughout the company, Shadow IT is simply the way they work. They experiment and innovate by constantly testing new technology. As a result, they improve innovation and speed, optimize output, and even automate complex tasks.

What is an example of Shadow IT?

No app or device is automatically Shadow IT. Instead, a technology resource becomes Shadow IT when it is used in the company without IT’s knowledge. This is especially relevant with cloud apps!

Some of the most common examples of Shadow IT are apps you probably use all the time! Applications for:

  • File sharing (iCloud, Google Drive, and Dropbox),
  • Productivity (Todoist, Trello, Asana, and Monday)
  • Scheduling (Calendly, and Sprintful)
  • Note-taking (Evernote, Notion, and OneNote)
  • Automation (IFTTT, Zapier, and Flow)
  • Messaging (WhatsApp, Slack, Teams)
  • Even the silly things you don’t think about, like an emoji keyboard extension in your browser or a Pomodoro timer

When outside of IT’s purview, even the most innocuous application is Shadow IT.

What About Shadow AI?

Today, between ChatGPT, Google Bard Gemini, Perplexity, etc., there is a host of powerful AI tools. In some ways, these tools are simply more SaaS applications with similar threats and opportunities. However, the big difference is that seemingly everyone is happily entering proprietary IP information into these tools.

The result is a new class of Shadow AI tools that, by there very nature, get more access to more information than most other tools.

For IT pros, though, the solution starts in the same way—discovery.

Note: Learn how a free trial of Torii can show you exactly how many shadow AI tools you have in your organization. Uncover Shadow AI

Why Do Employees Use Shadow IT?

Employees use Shadow IT because they are busy with a million to-dos and limited hours in the day. Typically when an employee adds a shadow application to its software stack, it’s not out of laziness, malice, or anything else. Instead, they are laser-focused on completing a job and looking for the best tools for that outcome.

How Common is Shadow IT?

Shadow IT is incredibly common. We found that 69% of IT leaders see Shadow IT as a top security concern related to SaaS Adoption. We have also found that most organizations have three to six times as many applications in their SaaS Stack as IT estimates. So it’s broadly known and still underestimated.

Can We Eliminate Shadow IT?

Not easily. Your company already has Shadow IT ingrained in the culture. Department heads test and buy new software all the time without ever consulting IT. Even individual employees are encouraged to test out software all the time.

The influx of shadow apps is just as much a result of company culture as it is of technology. It has become a reflex, a habit, a default.

However, just because we can’t eliminate Shadow IT doesn’t mean we can ignore it. We still have a responsibility to maintain the SaaS Security of the organization.

So, to summarize:

  • Shadow IT occurs anytime an employee adds unsanctioned technology to their company
  • It’s exciting and helpful for individual employees but…
  • Simultaneously, it’s a risk to the security of the organization
  • It typically takes the form of familiar apps that are easy to overlook
  • It’s incredibly widespread and underestimated
  • We can’t eliminate Shadow IT

The next question then is, what do we do?

How to Rethink Shadow IT

Now that we understand what “Shadow IT” is, we can shift the conversation. Instead of asking how to eliminate Shadow IT, let’s ask what makes Shadow IT a threat.

It’s not the apps themselves that pose a threat; it’s the fact that IT can’t see the application.

IT doesn’t need complete control. They need visibility.

They need to Illuminate the Shadows, not eliminate them.

Remember, Shadow IT can also represent good and exciting things like:

  • Innovation
  • Experimentation
  • Optimization

We want to keep the good while removing the negatives.

So, interested in illuminating what’s hidden? We’ve got three things you can do today to illuminate the shadows.

Three Steps To Take in 2024

1. Talk About Applications Openly

IT is no longer the gatekeeper; anyone with a corporate email and an internet connection can test software. So let’s open the lines of communication and prioritize education to make employees feel like stakeholders in the effort of security.

Ask department heads how they monitor app adoption, find out if they are tracking apps, and whether they have a method to evaluate success. A simple question like that can cause leaders to reconsider their app implementation.

Part of rethinking Shadow IT is changing how we talk about those applications. Instead of ignoring the shadows, let’s openly acknowledge the reality. Remind employees about the importance of thoughtfulness.

2. Discover, Discover, Discover!

Whether or not you take a security-centric approach to shadow IT is a good question, but before you can discuss the approach, you need to see what you’re working with.

Multiple methods of discovery exist: sending out questionnaires, sifting through expenses, Monitoring network traffic, and implementing a CASB. However, none of these methods provides complete visibility, even when done together.

Your best bet for comprehensive discovery is through a SaaS Management Platform. These platforms typically take a zero-touch approach through multiple methods of discovery so that once set-up, they continuously monitor your ecosystem for new apps.

Get full visibility into your shadow IT with Torii. Try a 14 day free trial—no credit card required.

3. Create an Application Rationalization Plan

When you discover new applications, you’ll need a plan for how to handle them. This plan is called application rationalization. It’s essentially a process by which you decide which apps to keep, replace, consolidate, or retire, aiming to cut redundancies, save costs, and boost efficiency.

Begin by cataloging and assessing applications for their business value, usage, cost, and security compliance. Then, prioritize actions based on their importance and impact, focusing on optimizing or removing inefficient apps.

As you go through this process, be sure to collaborate with other teams:

  • Security and compliance teams will want to make sure these changes don’t hurt your security posture
  • Finance teams will be (very) curious to get better insight into how much you pay for both sanctioned and unsanctioned apps
  • HR teams will want to understand which apps new hires should have access to on day one

Once you’ve tamed the Wild West, it’s time to incorporate a governance framework for managing the app lifecycle, including policies for new apps, regular reviews, and decommissioning criteria. Revisit your plan regularly to adapt to business and technology shifts.

With an application rationalization plan, you’ll be prepared to address every new and familiar application as it’s discovered, procured, considered for renewal, or identified for retirement.

Essentially, shadow IT might be introduced, but it will never again go unnoticed or unaddressed.