What Is Shadow IT and Why It’s Critical for Your Business’s Cybersecurity Strategy

Shadow IT is often described as IT systems and solutions developed and used within business organizations without official approval, which includes applications, services, and devices that operate beyond the oversight of the IT department.

Although Shadow IT empowers employees by enabling them to use tools that match their preferences and potentially increase work productivity, it also carries substantial security risk, particularly relating to data breach, data governance and cyber security.

Key Takeaways

  • Shadow IT means the use of hardware and software applications, and other IT solutions, without the awareness nor the approval of the organization’s IT or security team. 
  • The discovery and management of Shadow IT is critical to protect your business’s sensitive data from costly data breach and other cyber security risks.
  • Having a mix of security policies, technology solutions, and education is necessary to control and mitigate Shadow IT risk.

Understanding Shadow IT

Delving into the complexities of Shadow IT reveals significant implications for businesses.

Shadow IT Explained

Shadow IT includes technologies used by employees that are not officially approved by the IT department or the business organization for use. 

Examples of this are the use of popular cloud services and cloud apps such as Google Drive or Google Doc, web or mobile messaging apps and other unauthorized software or cloud-based apps with questionable cloud security, or personal devices that are connected to the company network. 

In short, Shadow IT is:

  • Unsanctioned : IT solutions that are not vetted by the official IT department nor the business.
  • Risky: Could expose organizations to security vulnerabilities and other cyber security risks such as company data breaches.
  • Popular Among Employees : for its convenience and ease of access.

Why Shadow IT is Popular in Businesses

The prevalence of Shadow IT has escalated with the ease of obtaining and using consumer-grade software and devices. Employees may look for alternatives due to:

  • Frustration : with official channels, software and other internal tools that fail to work as expected or are far too complex to use.
  • Desire : for more efficient or user-friendly options.
  • Availability : A vast market of easily accessible IT solutions.

Factors contributing to this rise in businesses include:

  • Consumerization of IT : As powerful technology becomes more readily available to individuals, employees bring these tools into the workplace.
  • Remote Workforces : Remote teams often resort to their preferred tools to collaborate effectively.

Why Shadow IT Management is Important

Managing Shadow IT effectively is paramount for a robust cybersecurity approach in any business. Acknowledging its presence, recognizing associated risks, and regulating its usage are crucial steps in safeguarding an organization’s data and network integrity. 

This task encompasses implementing organizational policies, utilizing technological solutions to oversee and manage data flow, and educating employees on the significance of complying with IT policies.

How to Manage Shadow IT Effectively

Effective Shadow IT management involves a structured approach that mitigates security risk while acknowledging the presence of unsanctioned IT resources. Businesses must adopt comprehensive strategies to ensure visibility and control over their IT environment.

Establish IT Governance

To manage Shadow IT, businesses should create and establish a robust IT governance framework. 

This framework should provide a structure that aligns IT strategy with business objectives, ensuring that all IT investments support business goals. This framework should include:

  • Documentation : Creation of an inventory of all approved and unauthorized IT assets.
  • Oversight : Setting up a team responsible for oversight, accountability, and decision-making regarding IT usage.

Create Transparent IT Policies

Transparent IT policies are crucial to guide employees in the appropriate use of technology. The policies should:

  • Outline acceptable use : Clearly define what constitutes acceptable IT best practices within the company.
  • Clarify consequences : Establish and communicate the ramifications for non-compliance and impact of data breach, to prevent unauthorized IT activities.

Employ Security Education and Training

To combat Shadow IT security risk, companies must prioritize security education and training. This can be implemented by having:

  • Regular workshops and seminars : to educate employees about Shadow IT and the cybersecurity risks associated with it.
  • Security awareness campaigns : drive initiatives that promotes awareness to employees about the importance of following IT policies, the consequences of non-compliance, and harmful effects on the business.

How to Reduce Shadow IT Risk 

Technology solutions designed to monitor and control unsanctioned IT systems, hardware, and software can be used by businesses to manage and reduce shadow IT risk and boost cybersecurity.

Leverage Data Loss Prevention Tools

Data Loss Prevention (DLP) tools can help safeguard sensitive information from unauthorized access and leaks. These tools help companies:

  • Monitor data in use, in motion, and at rest.
  • Identify and classify critical data across an organization.
  • Enforce policies that control who can access data and how it can be shared.
  • Prompt alerts for suspicious activities that may suggest shadow IT practices.

Utilizing DLP solutions can significantly reduce the risks of data breaches associated with unauthorized software and devices.

Utilize Cloud Access Security Brokers

Cloud Access Security Brokers (CASBs) serve as crucial intermediaries, safeguarding the connection between an organization’s internal infrastructure and external cloud service providers. Their pivotal role encompasses:

  1. Providing insight into unauthorized cloud services through meticulous traffic analysis and monitoring access logs.
  2. Enforcing compliance measures to ascertain that cloud applications align with the organization’s stringent security protocols.
  3. Enhancing security posture by proactively detecting and neutralizing any malicious behavior within cloud environments.

CASBs not only offer visibility and compliance but also play a vital role in fortifying the defense mechanisms against potential threats lurking within cloud services.

Use SaaS Management Platforms

SaaS (Software-as-a-Service) management tools can assist in managing Shadow IT by providing centralized visibility and control over the various cloud-based applications and services being used within an organization. 

An example of a robust SaaS management platform is Josys, which enables shadow IT discovery and offers effective shadow IT management to take action on unsanctioned apps and other security gaps. It helps reduce security risks, while offering advanced SaaS security features such as two-factor authentication, IP whitelisting, and more.


As businesses change in the digital world, dealing with Shadow IT becomes more and more important for keeping data safe.

We need to understand that while Shadow IT can help us come up with new ideas and work faster, it also brings serious security risks we can’t ignore. 

Managing Shadow IT well means teaching people, making rules, and using the right technology. By talking openly, giving safe tools, or using the right shadow IT application, companies can use Shadow IT to their advantage while also avoiding problems. 

Don’t let Shadow IT hinder your business growth potential. Take charge today and empower your organization with Josys. Schedule a demo now to see how Josys can transform your IT management and drive success!