Definition: what is Shadow IT?
Shadow IT refers to the use of IT systems, devices, software, and applications within a company that operate without approval and outside the control of the IT department. Examples include using Dropbox, WhatsApp, or Telegram for business purposes without official authorization. These uncontrolled applications can pose significant security risks and impact the efficiency of IT infrastructure.
Why is Shadow IT a Problem?
Shadow IT presents a significant risk to your company’s data security and compliance. Uncontrolled applications may have security vulnerabilities and be susceptible to cyberattacks. Moreover, using unauthorized software can lead to violations of data protection regulations, especially if sensitive data is processed or distributed without adequate security measures. These unsupervised applications may miss updates or security patches that should be managed by the IT department.
Risks of Shadow IT
Security Vulnerabilities
Uncontrolled software and devices offer potential entry points for cyberattacks. These can be exploited by malicious actors to steal or manipulate sensitive data.
Reputational Damage
If a cyberattack becomes public knowledge, companies face not only a security problem but also a loss of reputation. Existing customers may learn of the incident and lose trust in the company, potentially leading to significant revenue losses.
Data Protection Violations
Using unauthorized applications can lead to data being processed and distributed outside the company’s secure and compliant IT environment. This can result in significant data protection violations, especially concerning GDPR.
Inefficiencies and Higher Costs
Shadow IT can lead to redundant systems and inefficient workflows. This can strain IT budgets and reduce employee productivity.
WhatsApp and Shadow IT
A common example of Shadow IT is the use of WhatsApp for business communication. Although WhatsApp is a popular and user-friendly application, it poses significant risks for companies:
- Data Privacy Risks: WhatsApp stores data on servers outside the EU, potentially leading to data privacy issues. The processed data is primarily outside the company’s control.
- Lack of Control: The IT department has no central management of the app and its data. This creates security gaps (e.g., in the event of device loss) and prevents the protection of confidential information.
- Insufficient Compliance: WhatsApp often does not meet the strict data security and sovereignty requirements necessary in many industries.
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