As the founder and CEO of an IT and cybersecurity company, I've seen it all when it comes to technology in the workplace. One of the most concerning issues I've come across is something called "shadow IT."

In case you haven't heard of it, shadow IT refers to the use of technology solutions that haven't been approved by the IT department. This could be anything from employees using their personal devices to access company systems to using cloud-based services without permission.

While employees may engage in shadow IT to work more efficiently, it can cause a whole host of problems for your organization. It can create security risks, cause data loss, reduce productivity, and even create more work for everyone involved.


How Will Shadow IT Affect Small Businesses?

1. Security risks

One of the biggest concerns with shadow IT is that it can create security risks for a business. Since these technologies are not managed by the IT department, they may not have the same level of security measures in place as the organization's approved systems. This could lead to vulnerabilities and make it easier for cyber criminals to access sensitive company data.

Additionally, since the IT department is not aware of the existence of these systems, they may not be monitoring them for security issues or applying security updates to them in a timely manner. This can leave the organization at risk of cyber attacks and data breaches.

2. Data loss and duplication

The use of unauthorized technology solutions can also result in the duplication of data and applications, which can make it difficult to track where data is stored and who has access to it. This could lead to data loss, leaks, or misuse of sensitive information.

For example, if an employee is using a personal device to access company systems and data, the device may not be properly secured or managed. If the device is lost or stolen, the data stored on it could be compromised.

Similarly, if employees are using different cloud storage services to store and share files, it can be challenging to keep track of where data is stored and who has access to it. This could lead to data breaches or loss of control over sensitive information.

3. Reduced productivity

While employees may use shadow IT to work more efficiently, it can actually lead to reduced productivity for the business as a whole. If different departments are using different software solutions to manage projects or analyze data, it can be challenging to integrate the different systems and ensure that everyone is working from the same data sets.

This can lead to delays in decision-making, duplication of efforts, and missed opportunities. It can also create more work for the IT department, as they may need to troubleshoot issues related to multiple software solutions rather than just one.

4. Increased costs

Finally, shadow IT can lead to increased costs for a business. If employees are using personal devices or unauthorized software solutions, the organization may need to invest in additional security measures or software licenses to ensure that data is properly protected and managed.

Similarly, if different departments are using different software solutions to manage projects or analyze data, it can be challenging to negotiate enterprise-level pricing or get volume discounts on software licenses.


Real-World Examples of Shadow IT

Let me share a few examples that demonstrate how shadow IT can show up at a company and the harm it can cause.

An employee uses a personal file-sharing service:

A small marketing agency discovered that one of its employees was using a personal file-sharing service to store and share sensitive client data with team members. The employee believed the service was more user-friendly than the company-approved solution. However, the IT department had no control over the security settings or access permissions of the personal file-sharing service, putting sensitive client data at risk.

This incident led the company to implement a clear policy on approved file-sharing solutions and provide training to employees on their proper use.

Unauthorized customer relationship management (CRM) software:

A medium-sized manufacturing company discovered that its sales department had used an unauthorized CRM tool to manage customer interactions. Although the tool was not approved by the IT department, the sales team found it more convenient and efficient than the company's existing CRM system.

The use of the unauthorized tool led to data inconsistencies and increased the risk of data breaches. The company addressed the issue by working closely with the sales team to understand their needs and identify a suitable CRM solution that met both the sales team's requirements and the company's security standards.

Unsecured employee devices:

A small e-commerce business discovered that several employees were using their personal smartphones and laptops to access company data and work on projects outside office hours. The IT department had not approved these devices and had no control over their security measures or the data stored on them.

This situation left the company vulnerable to data breaches if an employee's device was lost, stolen, or compromised. To mitigate this risk, the company implemented a bring-your-own-device (BYOD) policy and provided training to employees on how to secure their devices and protect company data.

These examples demonstrate how small to medium-sized businesses can fall victim to the risks associated with shadow IT. They highlight the importance of having clear policies, providing employee training, and fostering collaboration between IT departments and other teams to address the challenges posed by shadow IT.


How can businesses prevent shadow IT?

Here are some steps you can take:

1. Develop clear policies and guidelines:

Having clear policies and guidelines is important because it establishes expectations for how employees should use technology solutions in the organization, reduces ambiguity around what is allowed, and helps prevent employees from using unapproved technology solutions that may pose security risks.

  • Conduct a thorough assessment of all technology solutions used within the organization to identify potential risks.
  • Develop policies that are easy to understand and provide examples of what constitutes approved and unapproved technology solutions.
  • Ensure that the policies are regularly updated and communicated to all stakeholders, including new employees and contractors.


2. Educate employees:

Educating employees is important because it helps them understand the risks associated with using unapproved technology solutions and reinforces the importance of following IT policies. It also helps create a culture of security awareness, which can help prevent employees from engaging in risky behavior that could compromise organizational security.

  • Develop training programs that help employees understand the potential risks associated with shadow IT and the importance of following IT policies.
  • Use real-life examples to illustrate the consequences of using unapproved technology solutions.
  • Encourage employees to report any suspicious activity related to technology use.


3. Foster collaboration:

Fostering collaboration between IT and other departments is important because it helps ensure that technology solutions meet the needs of employees and the organization. It also helps identify potential technology solutions that may be more effective than current options and reduce the likelihood of employees seeking out their own solutions.

  • Create cross-functional teams that include IT and other department representatives to work together on technology solutions.
  • Conduct regular meetings to identify opportunities for collaboration and to discuss the use of technology solutions.
  • Encourage communication and transparency among all stakeholders to ensure that everyone is aware of the approved technology solutions.


4. Monitor network traffic:

Monitoring network traffic is important because it can help detect unauthorized technology solutions that employees may be using and identify potential security risks associated with those solutions. By tracking network traffic, IT departments can detect and respond to security breaches before they become serious problems.

  • Use network monitoring tools to track the use of technology solutions within the organization.
  • Regularly review reports to identify any unauthorized technology use and take appropriate action.
  • Use analytics tools to identify patterns and trends related to technology use that could be indicative of shadow IT.


5. Provide IT support:

Providing IT support is important because it helps employees resolve technology issues in a timely manner, reducing the likelihood that they will turn to unapproved technology solutions as a workaround. It also fosters a culture of support and collaboration between IT and employees.

  • Develop a user-friendly IT support system that quickly and effectively solves employee technology issues.
  • Offer training and guidance on how to use approved technology solutions.
  • Create a culture of support by encouraging employees to seek IT assistance when needed.


6. Regularly review policies and procedures:

Regularly reviewing policies and procedures is important because it ensures that they remain up-to-date and effective in preventing shadow IT. It also helps organizations stay ahead of emerging security risks and technology trends and ensures that policies and procedures are effective over time.

  • Conduct regular reviews of policies and procedures to ensure they are up-to-date and effective in preventing shadow IT.
  • Solicit feedback from employees and other stakeholders on how to improve policies and procedures.
  • Stay up-to-date on emerging security risks and technology trends to ensure that policies and procedures remain effective over time.


By taking these steps, you can reduce the risk of shadow IT and ensure that your technology solutions are secure, efficient, and effective in meeting the needs of your employees and your business.

So, there you have it — my advice on how to prevent shadow IT in your organization. Remember, technology is an essential part of our modern workplaces, but it can also create risks if not managed properly.

By taking a proactive approach, you can keep your business running smoothly and protect your sensitive data from cyber threats.

If you want to learn more about IT and Security Services by speaking to a One Step Secure IT professional, schedule your call today!

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Scott KreisbergStay Safe,
Scott Kreisberg
CEO of One Step Secure IT