Organizations of all sizes have been forced to make cybersecurity one of their top priorities because the alternative is a costly data breach. What the same organizations often don’t realize, however, is that one of the biggest threats is lurking in the shadows of their networks, on workstations, and personal devices of their employees. This threat is referred to as shadow IT.
It’s becoming more prevalent as organizations migrate to the cloud and take advantage of Software as a Service (SaaS) applications – which are available to their employees over the internet, from anywhere, and at any time.
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The (Very Real) Shadow Monster
The average business owner would be terrified to discover something very similar to the “Shadow Monster” from Stranger Things lurking in the shadows of his or her organization. Like the fictional creature, this monster usually reveals itself only when it’s too late to avoid the chaos it brings.
Where did it come from? From within the organization itself. Shadow IT is the product of employees and the consequence of lacking IT policies and outdated technology.
What is Shadow IT in Cybersecurity?
Gartner defines shadow IT as IT devices, software, and services outside the ownership or control of IT organizations.
Shadow IT Examples
Examples of shadow IT include:
- The use of personal cloud file-sharing services (Google Drive, OneDrive, Dropbox) for work-related purposes.
- Unsanctioned instant messaging tools.
- SaaS analytics software used by the marketing department without explicit approval from IT.
- Smartphones, laptops, and wearables that don’t fall within the scope of the organization’s bring your own device (BYOD) policy.
Shadow IT Trends
2016: Gartner predicted that by 2020, one-third of successful cyberattacks would target shadow IT resources.
2019: Only 12% of IT departments were able to keep up with new technology requests, resulting in significant backlogs and delays in innovation.
2020: Shadow IT became a major issue, with 80% of employees admitting to using SaaS applications without IT approval.
2021: The average company had 108 known cloud services and a staggering 975 unknown cloud services running in their environment.
2023: Kaspersky reported that 85% of businesses experienced cyber incidents in the past two years, with 11% caused by unauthorized shadow IT
2024: IBM’s Cost of Data Breach Report revealed that 1 in 3 data breaches involved shadow IT, with the average breach costing $4.88 million—a 10% increase from the previous year and the highest cost ever recorded.
The intentions behind the unsanctioned use of devices, software, and services are rarely malicious. However, the impact of shadow IT on the organization’s overall cybersecurity posture can be severe.
Does your organization have the foundational security solutions implemented? Evaluate your cyber readiness in just 10 minutes with this checklist.
5 Impacts of Shadow IT on Your Cybersecurity
Unless shadow IT is nipped in the bud, its negative impact on your cybersecurity can be severe. Let’s take a closer look at the most significant risks and problems it creates:
1. Security Gaps
When shadow IT is allowed to flourish, it creates dangerous security gaps that make it much easier for cybercriminals to access your sensitive information. The growing availability of SaaS applications has made it challenging to identify these gaps, forcing organizations to adopt cloud-ready monitoring tools.
2. Poor Visibility
Organizations need complete visibility into their physical, virtual, and cloud infrastructure to detect all threats before they can cause a data breach. The mere existence of shadow IT makes this goal impossible. Why? Because all unsanctioned devices, software, and services are, by definition, invisible.
3. Greater Chance of Data Loss
When employees store data on personal cloud services or devices, the risk of data loss increases significantly. This happens because most employees do not implement proper backup strategies for their personal storage, leaving critical business data unprotected.
4. Compliance Issues
Shadow IT creates uncontrolled data flows leading to serious compliance issues for the entire organization.
Example
The General Data Protection Regulation (GDPR) establishes penalties of up to €20 million for the most severe violations of its data protection and privacy regulations.
5. Disrupted Workflows
Keeping sanctioned software and hardware patched is complex enough as it is, which is why throwing shadow IT into the mix can be disastrous. Additionally, efficient collaboration becomes difficult when employees are spread across 10 different tools that do more or less the same thing.
The Solution
Prevent the spread of shadow IT before it becomes expensive to deal with at best or uncontrollable at worst.
Shining a Light on Shadow IT
Shadow IT is a growing challenge for small businesses, but it can be effectively managed. The key is combining clear policies for overseeing new devices, software, and services with monitoring tools that ensure compliance. This approach gives your organization visibility into shadow IT practices and helps protect against cybersecurity risks.
If you’re just becoming aware of the dangers of shadow IT, start by assessing how widespread the issue is in your business. Identifying the use of unauthorized tools will help you understand the potential cybersecurity threats and allow you to take steps to mitigate them before they cause serious harm.
Safeguard Your Business from Shadow IT Risks
Teal is here to empower your business!
We offer comprehensive services and solutions that give you full visibility into how your employees use devices, software, and services.
By providing the tools and insights you need, we help you take control and ensure that your IT environment remains secure, compliant, and efficient.
Our responsive and secure managed IT services are tailored specifically for small and mid-sized businesses across the nation.
With local IT support in key cities like Minneapolis and Washington DC, we’re ready to help your business thrive.
Contact us today to learn more information about what it takes to shine a light on shadow IT.
