Shadow IT management has rapidly emerged as a critical topic, with 65% of unauthorised SaaS usage coming from departments like sales and marketing. This trend highlights a divide between operational flexibility and security. Cledara research shows that companies encounter shadow IT instances approximately every 4.9 seconds, resulting in 23.6 million annual events across surveyed businesses.
However, the challenge of managing shadow IT lies in balancing innovation and security. While shadow IT fosters agility, we need to emphasise the heightened risks of data breaches and compliance violations. In fact, breaches involving shadow data increase costs by 16% compared to fully managed data.
Therefore, we must consider how a hybrid governance approach could mitigate risks while leveraging shadow IT benefits. Organisations with extensive AI integration have cut breach costs, demonstrating technology’s role in bridging this gap.
However, without addressing root causes like unmet departmental IT needs or skill shortages—factors present in over half of breached organisations—shadow IT will continue proliferating.
What is Shadow IT Management?
Shadow IT management involves overseeing and controlling the use of information technology systems and applications that operate without explicit approval from an organisation’s IT department.
Examples include cloud storage services, SaaS tools, or personal devices linked to networks without IT’s knowledge. Tools like Active Directory play a key role in monitoring and managing access to prevent unauthorised data use.
Managing shadow IT ensures compliance with security policies and reduces the risk of data breaches by providing visibility into hidden systems. Efficient SaaS management can help mitigate shadow IT risks while saving budget. Learn more about this approach in “What is SaaS Management? How Does It Kill Shadow IT & Save Budget?”
Why is it Important to Manage Shadow IT?
Managing shadow IT is critical because it safeguards sensitive information from risks such as data breaches and compliance violations. Unauthorised IT systems, particularly cloud storage platforms, often bypass security protocols, creating vulnerabilities. According to Gartner, shadow IT accounts for nearly 30% of all enterprise attacks, making robust oversight a necessity.
Without active management, shadow IT can escalate costs. For instance, companies using unapproved software incur integration challenges and operational inefficiencies. IBM’s 2024 report found that breaches involving shadow IT increase costs by 16% compared to breaches of managed systems. Additionally, organisations with unmanaged data across multiple environments see longer breach containment times, averaging 292 days.
Proactively addressing shadow IT with tools like Active Directory and centralised IT policies allows companies to maintain control over their IT ecosystems. Cledara’s study of over 200 businesses revealed that departments bypassing IT approval accessed unauthorised platforms every 4.9 seconds, underscoring the frequency of this issue. Centralised management mitigates these risks by providing visibility and ensuring compliance.
Shadow IT management also fosters operational efficiency by aligning IT resources with business needs. Encouraging transparent use of technology while enforcing security protocols reduces risks without stifling innovation. Or kindly look deeper with “Understanding Shadow IT Examples and Their Impact on Cybersecurity.”
Challenges in Shadow IT Management
The challenges in Shadow IT management arise primarily from the unmonitored usage of tools and software by employees across departments. A report by Cledara reveals that shadow IT makes up over 50% of software usage in many businesses, with incidents occurring every 4.9 seconds. This high volume increases the difficulty for IT teams to identify and manage unauthorised applications.
One major challenge is the lack of visibility into the tools employees adopt without approval. These software applications often lack proper security controls, exposing organisations to data breaches.
For example, Gartner estimates that one-third of successful attacks on enterprises target data residing in shadow IT resources. Untracked software also complicates integration with existing systems, creating data silos and reducing operational efficiency.
Another difficulty is balancing flexibility and control. Employees often resort to shadow IT because approved tools fail to meet specific needs. However, granting too much freedom can result in non-compliance with regulatory requirements. IBM’s 2024 report shows breaches involving unmanaged systems cost 16% more on average, further emphasising this challenge.
For practical steps on securing your IT ecosystem, kindly explore “How to Prevent Shadow IT: A Practical Guide to Securing Your IT Ecosystem.”
Finally, managing employee behaviour is a significant hurdle. An analysis from Kaspersky highlights that over 64% of cybersecurity incidents are due to human errors. Education and training often lag behind technological adoption, leaving employees unaware of the risks associated with shadow IT.
Shadow IT Management Strategy for 2025
With those challenges above, a robust shadow IT management strategy for 2025 should prioritise proactive monitoring, secure tool adoption, and employee education. Leveraging software like Active Directory and endpoint detection systems is critical to identifying unauthorised tools in real time. Automation can enhance monitoring efficiency, reducing detection times for shadow IT usage.
Employee engagement is central to a sustainable strategy. Organisations should focus on education campaigns, emphasising the risks of unapproved tools. IBM’s findings indicate that informed employees can significantly reduce the cost of data breaches, potentially saving millions of dollars annually with effective training and AI integration.
Balancing flexibility and governance will also be crucial. Encouraging employees to request tools through simplified approval workflows can reduce the temptation to adopt shadow IT. For example, implementing a centralised software repository ensures that employees have access to secure, compliant alternatives without delays.
Investing in AI-driven risk prediction tools is essential to future-proofing the strategy. Gartner predicts a growing reliance on such technologies to mitigate the impact of shadow IT, particularly as hybrid work environments expand. These tools should be paired with multivariate analytics to uncover usage patterns, helping IT teams forecast trends and refine policies.
For more insights into the future of shadow IT management and strategies for 2025, kindly check “What is Shadow IT? An Outlook for IT Management in 2025.”
How Octobits Helps Your Shadow IT Management Strategy
As we all know, shadow IT management involves keeping your software ecosystem secure and efficient while giving employees the tools they need without compromising compliance.
That’s why Octobits, a SaaS shadow IT management platform, offers a centralised dashboard that integrates seamlessly with major platforms like Microsoft 365 and AWS. Octobits provides real-time visibility into your IT environment. You can monitor software usage, manage licences, and streamline employee onboarding and offboarding—all while mitigating risks.
What does this mean for your business? It means better control, fewer surprises, and a robust security posture. With Octobits, you can close security gaps, enhance compliance, and ensure your employees have access to the tools they need without the risks of unmanaged IT.
So have a go at Octobits now, because you have a free trial until the end of December 2024.
In Closing
Organisations can mitigate risks by embracing strategies like centralised monitoring, AI-driven risk prediction, and proactive employee engagement while retaining operational agility.
Looking ahead, the future of IT management will rely heavily on balancing governance and flexibility, ensuring that all departments can meet their technological needs without compromising security. Tools like Active Directory and platforms like Octobits will be pivotal in achieving this balance. Now is in your hands: the success of your IT framework will hinge on robust shadow IT management.
References
- Mallmann, G. L., Pinto, A. de V., & Maçada, A. C. G. (2019). Shedding light on shadow IT: Definition, related concepts, and consequences. In I. Ramos et al. (Eds.), Information Systems for Industry 4.0 (pp. 63–70). Springer Nature. https://doi.org/10.1007/978-3-030-14850-8_5
- Van Acken, J.-P., Jansen, F., Jansen, S., & Labunets, K. (2024). Who is the IT Department Anyway: An evaluative case study of shadow IT mindsets among corporate employees. Twentieth Symposium on Usable Privacy and Security, USENIX. Retrieved from https://www.usenix.org/conference/soups2024/presentation/van-acken
- Kopper, A., Westner, M., & Strahringer, S. (2020). From Shadow IT to Business-managed IT: A qualitative comparative analysis to determine configurations for successful management of IT by business entities. Information Systems and e-Business Management, 18(2), 209–257. https://doi.org/10.1007/s10257-020-00472-6
- Kaspersky. (2023). Redefining the human factor in cybersecurity: Adopting a 360° model. Kaspersky Official Blog. Retrieved from https://www.kaspersky.com/blog/human-factor-360-report-2023/
- Cledara. (2023). The state of shadow IT. Cledara. Retrieved from https://resources.cledara.com/state-of-shadow-it
- IBM Security & Ponemon Institute. (2024). Cost of a data breach report 2024. IBM. Retrieved from https://www.ibm.com/reports/data-breach
