Stopping Risks Introduced Through Shadow IT

Any unknown application, device or IT specific service brought into the IT Systems that is not known to the IT departments can pose a security risk. The risk proposition is based on the premise that these application/device/service are not screened through the on-boarding process, thereby making an entry in the enterprise IT System without required checks and balances. This practice is known as Shadow IT. With widespread utilization of IT-integrated capabilities and diverse functional/role specific usage, Shadow IT has become a business reality.

Shadow technologies include hardware or software, including smartphones, tablets, USB drives, Google Docs, instant messaging services, Skype and so on. The practice of Shadow IT can be undertaken by an individual, or business division to conduct a business process such as sharing information, setting processes, planning, etc. Shadow IT has become one of the rising concerns for compliance & audit. One of the instances could be information leaked through an employee’s unsupported or private technology.

Let’s have a look at the critical risks that that an organization must be aware of in the context of management of Shadow IT:

1. Risk of Losing Data: Shadow IT opens-up avenues of leaking out of sensitive data to platforms that are beyond the control and accessibility of corporate IT department. Achieving a balance in information access is tricky, as on one hand there is a compliance aspect and on the other there are efficiency related issues. Traditionally data ownership was restricted to limited set of people, but in current scenario, organizations must get the data flow freely within departments to enable day-to-day operations. While industry experts believe that Shadow IT is to stay, businesses are required to proactively safeguard data by enabling IT to take control, enforce data encryption and setup relevant back-up mechanisms.
2. Risk of System Penetration: With digitization, users in an organization can access third-party applications, software and tools to optimize their productivity or improve their department’s efficiency. This often happens without the knowledge of IT department of the organization, making way for risk and penetration theft- that may lead grave consequences for the organization and brand reputation. It is therefore recommended to have a fool proof IT setup in place and educate each user about the processes to follow when a new technology is to be introduced. By avoiding such practices security-related risks can be managed and monitored.
3. Risk of Maintaining Data Sovereignty: Data security related legislation may or may not be stringent depending on the location of a user. There is a possibility that an organization has a global spread and the data and security related concerns must be managed and enforced as per the host country’s laws. Most strict data sovereignty laws are applied in Germany. Additionally, most of the regions with tight data regulations such as European Union, are not allowed to share the data with the third-party clouds, and others unless it is encrypted. Such regulations set the platform for data management. At an enterprise level, it is important to place right checks at a corporate governance level through IT practices and protocols, including eliminating the practice of Shadow IT.
4. Risks Associated with Licensing & Certifications: Businesses are bound and controlled by software licensing and certifications, making it difficult for the enterprises to follow and monitor the controlling of access to relevant data and information. With the advent of practices such as BYOD, some of the software licenses which are purchased outside the knowledge or purview of the business enterprise can be conflicting in terms of contractual requirements. Such condition may seem harmless at the onset, but they might capture sensitive information from an enterprise IT System and Data Repositories.
5. Risk of Defying Compliance: Being on a regulatory compliant environment means that the data is restricted within the enterprise networks and is monitored, accessed, controlled and audited. This includes IT devices & systems connected with-in an organization. With the latest IT trends related to Enterprise Mobility, corporate data is accessed by users who may not be in the physical control zone or organization. Therefore, limiting the access becomes crucial when it comes to enabling remote access and facilitating user mobility, such limitations include usage of shadow technology.

By observing the threat-paradigm, IT departments can arm themselves for future challenges in the industry. It is important for IT departments to enable smooth on-boarding of technology by bringing innovative practices and advancements that can help businesses achieve goals. The practices of proper risk management, channeled budget allocation and compliant IT systems should not be ignored.

With the technological advancements and innovation, Shadow IT is undoubtedly here to stay. The end-game is all about how the practice of shadow IT is managed to limit the threats associated with IT System Security. Shadow IT can cause harm and bring vulnerabilities to the IT Environment – but the checks placed in the system to discourage shadow IT should not hamper technology on-boarding. All in all, the technology on-boarding process should be streamlined and employees or departments must not hesitate in bringing a new technology in the notice of IT department.