Article
2 min read
Shadow IT: What It Is, Why It Grows, and How IT Teams Can Get Ahead of It
IT & device management
Author
Dr Kristine Lennie
Last Update
September 15, 2026
Table of Contents
What is shadow IT?
Why shadow IT keeps growing
The biggest shadow IT risks
How IT teams can get ahead of shadow IT
Example: Finding 60+ applications outside the approved stack
Bring shadow IT under control with Deel IT
Shadow IT includes the apps, services, and tools employees use for work without IT’s knowledge or approval. It often starts when employees adopt new tools to solve a problem or work more efficiently.
Shadow IT creates blind spots around company data and access. When IT can’t see which tools employees are using, it becomes harder to know where company data is going, who can access it, and which applications pose security or compliance risks.
Better visibility makes shadow IT easier to manage. Deel IT helps teams discover apps employees log into through JumpCloud, classify them as Approved, Restricted, or Ignored, and keep upcoming renewals and software spend visible in one place.
Since the rise of generative AI in 2022, employees have had more tools than ever to help them work faster and be more productive. They can find an AI assistant, SaaS app, or browser extension, sign up with a work email, and start using it in minutes. That convenience has also made shadow IT more prevalent, as new tools can enter company workflows faster than IT teams can discover and review them. Without visibility into those tools, IT can lose track of where company data is going, who has access to it, and which applications are creating security, compliance, or cost risks.
What is shadow IT?
“Shadow IT” refers to software, services, or devices employees use for work without IT’s knowledge or approval. The term can make the behavior sound deliberate, but employees often adopt these tools simply because they solve an immediate problem: a sales rep finds a better note-taking app, a developer uses an AI assistant to troubleshoot code, or a marketing team buys a specialized analytics platform.
These tools can connect to company email, documents, customer records, calendars, or code before IT knows they exist, creating gaps in visibility and access management. Accounts and integrations can remain active after employees leave, security incidents can go unnoticed internally, and incomplete software inventories can make compliance reviews harder.
Why shadow IT keeps growing
Several shifts in how companies buy and use software have made shadow IT easier to create and harder to track.
Some of the most common factors contributing to the growth of shadow IT include:
SaaS is easier than ever to adopt: Employees can create an account, connect their work credentials, and start using a new tool in minutes, often without involving IT.
AI has created a new wave of workplace tools: Employees are increasingly turning to AI assistants and other AI-powered apps to write, research, analyze data, code, and automate everyday tasks, often without waiting for company-wide adoption or approval
Employees have more specialized tools to choose from: Teams can find software built for specific roles, workflows, and use cases, making it easier to adopt a point solution instead of relying on the company’s existing stack
Slow approval processes encourage workarounds: When employees need software now, and approval takes weeks, they have a strong incentive to find and adopt a tool themselves
Departments increasingly buy software independently: Marketing, Finance, Sales, and Operations may have their own budgets and purchasing authority, allowing new tools to enter the organization without going through IT
The biggest shadow IT risks
The level of risk depends on what a tool can access, how employees use it, and whether IT can manage that access. Understanding where that risk shows up can help IT teams decide which applications need attention first.
| Risk | What it means | Potential impact |
|---|---|---|
| Data exposure | Company, customer, or employee data is stored or processed in tools IT doesn’t manage. | Sensitive data may be shared, retained, or accessed without the company’s usual controls. |
| Compliance gaps | IT doesn’t have a complete view of the applications handling company data. | Data inventories can be incomplete, making audits and regulatory requirements harder to manage. |
| Lingering access | Accounts or integrations remain active after an employee changes roles or leaves. | Former employees or unused accounts may retain access to company data and systems. |
| Software waste | Teams independently purchase overlapping or underused applications. | Companies can end up paying for duplicate tools, unused licenses, and unnecessary renewals. |
Data exposure and lingering access typically deserve the fastest attention because of their security and compliance implications. Better software visibility can also uncover unnecessary spend, giving IT and Finance an opportunity to consolidate tools and reduce waste.
Read also: What Happens When an Employee Shares Confidential Data with an AI Tool (and What to Do About It)
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How IT teams can get ahead of shadow IT
Managing shadow IT starts with visibility. IT teams need a clear picture of which applications employees are using, how those tools interact with company data, and where they may introduce risk. From there, they can make informed decisions about which tools to approve, restrict, or remove.
The process also needs to work for employees. When software reviews are slow or difficult to navigate, people are more likely to find their own solutions. IT teams can take these steps to bring shadow IT under control without getting in the way of productivity:
Step 1: Discover and classify what employees are using. Automated software discovery can surface applications that haven’t gone through IT review. Teams can then assess each app and decide whether to approve, restrict, or otherwise manage it.
Step 2: Prioritize applications based on risk. An application that handles sensitive company data deserves more scrutiny than a low-risk productivity tool. Consider data access, permissions, business use, and relevant security or compliance requirements to determine what needs attention first.
Step 3: Create a faster path to approved tools. Make software requests and reviews easy to navigate so employees have fewer reasons to bypass the process. Streamlining lower-risk reviews can also help IT focus its time on applications that require closer scrutiny.
Step 4: Review your software environment regularly. New tools appear quickly, while existing ones fall out of use. Regular reviews can help uncover unapproved apps, unnecessary access, duplicate tools, and upcoming renewals before they become bigger problems.
Following these steps gives IT a repeatable way to manage new tools as they appear, while giving employees room to adopt software that helps them work effectively.
Find out more with: A Simple Guide to Unified Application Licensing and Access Management
Example: Finding 60+ applications outside the approved stack
Consider a hypothetical 400-person technology company that centrally manages around 20 core applications.
The scenario: Ahead of a SOC 2 audit, IT discovers more than 60 additional applications employees have been using outside its approved software stack.
The problem: IT doesn’t have a complete view of these applications or whether they meet the company’s security and compliance requirements.
The impact: The team now has dozens of applications to investigate while preparing for the audit, adding to its workload and making it harder to maintain an accurate software inventory.
Two possible solutions: IT has the following options:
Conduct regular manual reviews: IT can periodically review applications connected to company identities, update its software inventory, and assess new tools as they appear.
Use automated software discovery: IT can use software discovery tools to surface applications employees use, maintain an up-to-date inventory, and create a more consistent process for reviewing and classifying new tools.
Learn how to solve cross-department permission chaos with unified access management.
Bring shadow IT under control with Deel IT
Managing shadow IT starts with knowing which applications employees are actually using. Deel IT Software Management integrates with JumpCloud to automatically discover apps employees log into, helping IT surface software that may not have been reviewed or formally approved.
Deel IT brings discovered apps, upcoming renewals, and software spend into one dashboard, giving IT greater visibility into its software environment and helping teams identify security, compliance, and cost-management priorities.
With Deel IT, IT teams can:
Get better visibility into shadow IT: Discover applications through connected identity providers, such as JumpCloud, and bring them into a clearer software inventory
Keep your software stack organized: Track applications, owners, users, and contract details from one centralized dashboard
Spot opportunities to reduce software spend: Use contract and usage information to identify underused or overlapping tools and make more informed spending decisions
Stay ahead of renewals: Keep upcoming renewal dates visible so your team has time to review tools and contracts before they renew
Manage IT in one place: Manage software alongside devices, access, and the worker lifecycle in Deel IT, giving IT teams one platform for their day-to-day work.
By giving IT teams a clearer view of the applications employees use, Deel IT helps turn shadow IT from an unknown into software that can be reviewed and managed.
Deel IT
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FAQs
What is the difference between shadow IT and unauthorized software?
Shadow IT covers software, services, or devices employees use without IT’s knowledge or approval. The tool may simply never have gone through the company’s review process.
Unauthorized software generally refers to applications the organization has explicitly prohibited.
That distinction affects how IT responds. A prohibited application may need to be blocked, while an unreviewed application can be assessed based on its security, compliance, access, and business requirements.
How can IT find shadow IT without relying on employees to self-report?
Automated discovery can give IT a more complete picture than self-reporting alone.
Identity and SSO data can help surface applications employees access with company credentials. Expense and corporate card data can reveal SaaS subscriptions purchased outside centralized procurement. Depending on the organization’s environment, additional discovery methods can provide visibility into other applications.
Employee surveys can complement these sources, especially when IT needs more context on how and why teams use particular tools.
Does managing shadow IT mean replacing every unapproved tool?
No. Once IT has visibility, teams can evaluate applications based on factors such as data access, security requirements, compliance needs, usage, and business value.
Some applications may need to be replaced. Others may pass review and become approved tools. Lower-risk applications may simply need to be documented and monitored.
This risk-based approach gives IT a practical way to manage a growing software environment without creating unnecessary friction for employees.
What happens to shadow IT integrations when an employee leaves?
Applications outside IT’s inventory can easily fall outside the standard offboarding process. That can leave accounts, permissions, or integrations in place after an employee has left.
Software discovery and lifecycle-based access management help close that gap. IT can identify applications in use, determine which access needs to be managed, and incorporate those systems into a more consistent offboarding process.
Dr Kristine Lennie holds a PhD in Mathematical Biology and loves learning, research and content creation. She had written academic, creative and industry-related content and enjoys exploring new topics and ideas. She is passionate about helping create a truly global workforce, where employers and employees are not limited by borders to achieve success.
