Quick takeaway for busy readers

Shadow IT refers to any software, cloud service, or gadget employees use without IT’s say-so. It grows because staff just want to work faster—but it can punch holes in security, budgets, and compliance. A clear policy, quality tools, and an MSP that can both detect and coach are the antidote.

What Exactly Is Shadow IT?

Shadow IT puts your company at risk. Shadow IT—sounds spooky, right? Maybe you picture a caped figure lurking in the recesses of the server room. So, what is it? A friend or foe—a hero or a dastardly villain?

Here’s the quick reveal: Shadow IT isn’t a villain or a hero. It’s every app, cloud service, or gadget your team adopts without the knowledge or approval of the IT department and with no thought to data security. For example:

Your marketing coordinator uploads a big video file to his personal Dropbox account
A sales rep plugs in his keychain USB stick to take home a file he wants to work on from home.

Their intentions are good—get work done faster—but the chosen tools are operating outside your defense perimeter, creating weaknesses that hackers can exploit, compliance auditors can fine, all while raising the odds of an accidental loss of data.

In this post, we’ll explore why unsanctioned shortcuts can be costly — and how an IT partner can help banish the shadows and light up your security and productivity.

Why Shadow IT Spreads in the Workplace

Now that you know what Shadow IT is, you may wonder why it is so common. In fact, according to security firm Gartner by 2027 “75% of employees will acquire, modify or create technology outside IT’s visibility – up from 41% in 2022."

Why would such a large percentage of workers resort to unapproved technologies instead of using company-sanctioned ones? Here are four reasons:

Speed & convenience – people Google a tool, click “Sign Up,” and solve today’s problem in minutes.
Remote & hybrid work – home networks and personal devices blur the line between “office” and “outside.” Shadow IT usage jumped 59% with the shift to remote work during the COVID pandemic.
Unaware of the risk – staff rarely realize that a harmless-looking SaaS can store confidential data in regions your privacy policy forbids.
Rigid or slow approval process – if getting a new app blessed takes weeks, users quietly route around it – especially if there is pressure to “get the job done.”

Shadow It Types2

The Problems and Risks of Shadow IT

Your next question probably goes like this: Is it really such a big deal if team members use Shadow IT? Some would point out that it can foster innovation and agility as it leads to quicker adoption of new technologies and tools. While that can be true, we must acknowledge the serious risks – security vulnerabilities and compliance issues – compounded by Shadow IT. Here are some examples:

Risks of Shadow IT
Shadow IT Item	Risk Type	Possible Effects
Personal, unencrypted USB drives & external HDDs	Security Breach	Malware infections. Instant data loss if the drive is lost or stolen.
Consumer file-sharing apps (Dropbox, Google Drive personal, WeTransfer)	Compliance Violations Data Sprawl	Data now lives in a cloud you don’t manage. Data residency rules are broken. Possible fines & legal exposure. Multiple "shadow” versions of the same file in different clouds.
Messaging apps (WhatsApp, Telegram, Signal, Discord)	Compliance Violations Data Policy Failures	Chats auto-back up to consumer clouds No retention, no audit trail Possible PII exposure.
“Free” AI & productivity tools (ChatGPT, Grammarly browser plug-ins, PDF converters)	Security Breach Control of Data	Unintended sharing of sensitive information. AI models might save or retain the data provided, potentially exposing sensitive information. Plugins may have exploitable security vulnerabilities. Online file converters may deliver malware.
Personal laptops & phones	Security Breach Compliance Violations Control of Data	Missing patches, no disk-encryption, unknown antivirus. Increased chance of data loss through theft. Exposes company network to attack. Possible fines and legal exposure due to compliance failures.
Project / task SaaS (Trello, Asana, Notion personal workspaces)	Support headaches Duplicate license costs Control of Data	Customer data and IP spread across unknown servers. Paying for multiple products to do the same tasks. Loss of productivity due to lack of product knowledge.

Think that none of these potential risks will affect you? Be aware that according to IBM’s Cost of a Data Breach Report 2024 “35% of breaches involved shadow data…” (that’s data stored outside of officially managed and controlled systems).

Even big players have felt the sting of shadow it. For example, in 2023 it was reported that Samsung employees leaked confidential data including internal meeting notes and even source code for a new program through unapproved use of ChatGPT.

Five Friendly Ways to Bring Shadow IT Under Control

How can you turn the spotlight on instances of shadow IT to be found in your organization?

1) Establish Clear IT Policies and Guidelines

Think of this as setting the house rules: where company data can live, which tools are allowed, and the process for requesting something new. A good policy is short, written in plain language, and explains why the rules exist (protect customers, meet compliance, reduce chaos).

How your IT partner can help: Working together, you’ll draft a clear, concise, customized policy that outlines acceptable usage of IT resources prioritizing security and compliance.

2) Educate and Empower Employees

Most Shadow IT arises from people just trying to get work done. Incorporating shadow IT topics into regular cybersecurity awareness sessions will go a long way to turn the tide away from its rampant usage. For example, when staff understand that a lost USB stick can trigger a data-breach notice, they think twice.

Your IT partner’s role: Supply engaging awareness training such as short videos and fun quizzes, track completion rates, and tailor content to real incidents they see on your network.

3) Implement Proactive Monitoring and Detection

You can’t fix what you can’t see. Using asset discovery and management tools, Mobile Device Management (MDM), and an Endpoint Protection Platform (EPP) gives you insight into the devices, applications, and cloud services actually being used on the network.

What your IT partner will do: Deploy and fine-tune these tools according to your company’s specific policies and procedures. If they discover something’s not right, you’ll be informed and mitigations can me implemented.

4) Foster Collaboration and Support

Shadow IT often creeps in to fill a gap in productivity. Create a culture where employees feel safe asking for new tools and know the approval process is quick.

Your IT partner’s role: Evaluate new apps for security, cost, and integration with approved tools and workflows. If one is unsuitable, they can suggest alternatives that fill the gap while maintaining adherence to existing policies.

5) Provide Secure, Sanctioned Alternatives

The surest way to stop shadow IT use is to offer practical, useful, IT-sanctioned tools. Think corporate OneDrive/SharePoint for file storage/sharing, Microsoft Teams or Slack for chat, company-issued encrypted USB keys for offline transfers. When the officially supported tool does the job well, need for shadow options fades away.

How your IT partner will support you: Roll out these approved platforms, migrate existing data, set up single sign-on (SSO) so logins are effortless, and keep everything patched and backed up.

Spotlight: How ThreatLocker Helps Detect, Stop, and Prevent Shadow IT

One of our favorite and most effective tools for identifying and shutting down Shadow IT is ThreatLocker—a Zero Trust endpoint security platform that gives you complete visibility and control over the software running in your environment.

Detecting Shadow IT: Learning Mode in Action

ThreatLocker is initially rolled out to your organization in Learning Mode, analyzing the environment to catalog every application and service in use. This creates a real-time software inventory—including tools that may have quietly slipped past IT oversight. This audit produces a full report, offering transparency into what’s really running on your network.

Stopping Shadow IT: Block What’s Not Approved

Armed with a complete picture of your technology ecosystem, admins can block unauthorized tools by building a custom allowlist of approved applications. It’s like a list of members at an exclusive club – if you’re not on the list, you don’t get in. Similarly, if an application is not on the allowlist – it doesn’t run. This approach effectively stops shadow IT cold.

Preventing Shadow IT: Enforce Zero Trust

ThreatLocker’s Allowlisting blocks everything by default, only allowing pre-approved applications to operate. But it doesn’t stop there. With Ringfencing™, you can isolate applications from interacting with each other or accessing sensitive parts of the system—ensuring that even trusted software doesn’t become a risk.

Together, these layers enforce a Zero Trust model that not only eliminates current Shadow IT but prevents it from creeping back in.

If you're serious about eliminating Shadow IT, ThreatLocker offers one of the most comprehensive solutions available today. Contact us for a free consultation to learn how ThreatLocker can work for you.

Shadow It Partner

Key Takeaways: How to Deal with Shadow IT

Shadow IT refers to invisible apps and devices employees use without approval.
It thrives because it’s quick and easy—but 1 in 3 breaches start there.
A mix of discovery tools, clear policy, and supportive training keeps it in check.
Partnering with a proactive MSP turns shadowy corners into well-lit, well-managed workspaces.

Ready to shine a light on your own hidden apps and hardware?

Book a free cybersecurity consultation with our team to uncover and eliminate the risks of Shadow IT.

Tag: Compliance