Software as a service (SaaS) has undeniably reached the height of its popularity. Modern corporate operations and continuity depend today more than ever on software technologies. The right procurement procedures haven't yet been adopted by enough businesses, despite this, so they can't be sure they're safeguarding their reputations and preventing data breaches.
The growing practise of "shadow IT," which refers to when employees download and utilise software solutions without informing their internal IT personnel, is a crucial factor causing worries about SaaS management. According to a recent poll, more than 65% of IT professionals claim their SaaS tools aren't getting approved, and 77% of them anticipate that shadow IT will become a serious issue in 2023. As the use of SaaS spreads, organisations are starting to struggle with managing security in addition to the obvious worries about overspending and the disruptions to operational effectiveness.
Unfortunately, for many organisations, ignoring shadow IT is no longer an option. The average cost of data breaches and other security attacks to firms is $4.5 million, and a rising software market is largely to blame for many of these incidents. Organisations must implement an efficient procurement procedure when bringing on new software solutions and increase visibility over their SaaS stacks to prevent shadow IT and the high risks that go along with it.
Why does Shadow IT pose such a risk?
The lack of visibility within an organisation is the root cause of all shadow IT problems. IT teams have no control over the use and distribution of sensitive company data when a software stack is not maintained. Most organisations do not fully protect the data these tools retain because they do not properly vet them and do not monitor them.
This sets up the ideal environment for hackers to quickly steal crucial data, such as private financial records or personal information. Because most, if not all, SaaS products require corporate credentials and access to an organization's internal network, crucial company data is at risk. According to a recent poll by Adaptive Shield and CSA, 63% of CISOs have reported security problems resulting from this kind of SaaS misuse in the previous year alone.
Consequences of loopholes
As previously said, the possibility of a data breach is a recurrent trend that many firms are encountering with shadow IT. However, it is also crucial to be aware of the potential regulatory fines and industry scrutiny that organisations may experience as a result of the widespread usage of shadow IT.
Unauthorised software is likely to fall short of the compliance requirements set forth by laws like the General Data Protection Regulation (GDPR), the Federal Information Security Management Act (FISMA), and the Health Insurance Portability and Accountability Act (HIPAA), which businesses are required to uphold. For businesses in sectors with rigorous regulations, penalties for noncompliance can result in irreversible reputational harm, which cannot be remedied by merely paying the corresponding fine.
Organisations are unaware of the wasted operating dollars spent on tools and applications, in addition to the costs related to a security failure and the reputational harm a business suffers. Due to issues like rogue subteams, departments providing their own software, or employees using corporate credentials to access freemium or single-seat tools, it can be difficult for large organisations to find all the applications that the company never approved.
Mitigation Tips
Acquiring visibility into the current software stack is an essential first step in addressing an organization's SaaS sprawl and making sure that shadow IT never puts you in a precarious situation. Without visibility, a company won't know what tools are being utilised and won't be able to decide whether or not to centralise its software. IT teams should put their efforts into updating the documentation for their software portfolio and keeping track of application functions, software usage, the contract/subscription duration of each tool, and cost.
IT teams can determine which tools are crucial and where modifications can be made after access to this information is gained and correctly maintained. After doing some housekeeping, firms can set up a centralised procurement system to make sure that all future purchases are coordinated between departments and that any security or compliance requirements are constantly satisfied to avoid security lapses and legal repercussions. With access to these records, organisations can easily keep track of every usage, cutting down on wasteful spending and security lapses.
