What is Shadow IT, How It can impact your business and what you can do about it

eXo Platform Blog

The modern workplace evolved significantly in recent years with technological advancements and the takeover of a new generation of employees (millennials and Gen Z). The growing number of consumer applications (like social media platforms, messaging apps etc…) impacted every aspect of every day life. As a result, it became increasingly crucial for organizations to provide the right tools to satisfy the growing demands and high expectations of their workforce.

Business platforms and applications were designed in the last decade to achieve this goal. From Enterprise Social Networks and Knowledge Management Systems to chat applications, businesses had a wide variety of solutions to improve communication, collaboration and productivity in the workplace. However, the multitude of tools created an overload and data dispersion with employees spending a considerable amount of time switching between these tools to find and extract the information they need.

Digital workplace solutions came in to play to streamline business processes and encompass all of the tools in use within the workplace. Although effective in dealing with communication and productivity issues, a number of businesses do implement these solutions without a clear strategy and vision which leads to low adoption and engagement rates and makes employees look for other alternatives to perform their jobs.

In this blog post, we will define Shadow IT “a common theme in the modern workplace”, how it can impact businesses and what are the necessary measures to deal with it.

What is Shadow IT?

Shadow IT is a common phenomenon within businesses regardless of their industry and size. It represents the use of tools, applications and platforms without the approval and knowledge of the IT department. Employees tend to use their own applications when they do not see any real value in the system they have in place if there is any. When managed poorly, Shadow IT can have a damaging impact on businesses as it makes them lose control of critical information, drives IT costs and poses security threats.

How Shadow IT can impact your business?

To get the full picture of the impact of Shadow IT, let’s take the example of two teams (team A and team B) within the same company. Each team has a group on Facebook in which members can collaborate on work related topics. Team A members are using Messenger to communicate and exchange files while team B is using Whatsapp. In some cases, both teams may tend to use different ESNs, KMSs and project management platforms to organize their work. The work of both teams is conducted without the approval of the IT department which can lead to:

  • The inability of the IT department to control the software used by employees which leads to security vulnerabilities and data loss.
  • The IT department is unable to properly plan for system upgrades, capacity and security with data spread across multiple sources.
  • An increase in time spent by employees looking for information across a number of platforms and applications which leads to a decrease in productivity.
  • Compliance issues for companies within specific industries with high compliance standards.
  • Costs associated with data loss and unused systems.

The impact of Shadow IT is negative and sometimes disastrous for businesses. However, in some cases Shadow IT can have a positive impact and play an important role in improving communication and driving innovation in the workplace. At the end of the day, the main reason employees are using alternative, unapproved solutions is to facilitate their work and be more productive. Furthermore, Shadow applications can make IT departments rethink their strategy and find solutions that can more or less meet employees’ expectations. For example, if a company finds out that their workforce uses Facebook to communicate, they can react by implementing an Enterprise Social Network that has the same features as Facebook and that is fully integrated within the IT system.

How to deal with Shadow IT?

As its name implies, detecting Shadow IT is often tricky for businesses as employees are relying on software without the knowledge of the IT department. However, there are a number of initiatives that can be used to detect and take advantage of Shadow IT.

  • Listen to your workforce:

In order for your IT team to understand the situation and take decisive actions, they have to communicate with different teams to identify their needs. Surveys and focus groups can be used to determine which team is using which software. The results can then be the basis for upcoming IT projects.

  • Training:

Employees can opt to use their own applications when they are not provided with adequate training on approved IT software. To rectify the situation, IT teams have to plan and deliver training sessions in which they educate employees on how to use the software, communicate the value of the existing IT setup and highlight the risks of Shadow IT.

  • Adapt your policies:

It is easier said than done, but in some cases businesses have to adapt to the surge in unapproved software by changing their IT policies. These policies differ depending on the situation. Some businesses may adopt an open policy that regulates the use of devices and third party applications. On the other hand, some businesses may choose a more strict policy by restricting access to solutions and giving the IT department more control.

  • Continuous assessment:

To minimize the risks associated with Shadow IT, the IT team has to continuously monitor the network and software used within the workplace and act accordingly. Shadow IT Discovery tools are ideal to detect unapproved software and assess the risks of each one.

Shadow IT is a practice that is not expected to stop any time soon. Employees will always try and find the most convenient tools to perform their jobs even without the approval of their IT department. This is why it is very important for businesses to understand Shadow IT, its causes and implications to be able to minimize its risks and benefit from its advantages.

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Product Marketing Specialist

I am a product marketing specialist at eXo. My role is to assist marketing and sales teams in their operations and present our digital workplace solution to the world. I mainly blog about the latest tech trends, digital transformation, internal communication and how to navigate through eXo Platform.

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