I was catching up with a client a few days ago about current status in their organisation, and he mentioned that due to business conditions, the IT budget had been slashed to a third of what it was at the beginning of the year. And since they’d already spent 80% of the budget for the year, there wasn’t much more they could do for the rest of the year. The executives made the decision to slash the budget.

Interestingly, he then mentioned the growth in shadow IT – people bringing in their own systems instead of the IT provided ones – and that the executives were key movers in doing this. I asked what he had done to point out the disconnect, and then suggested that he write a paper for the board addressing this head on (which isn’t one of the five strategies in the above video, by the way).

Specifically, that the paper should point out that:
– (1) the firm has a strategy for IT provided applications,
– (2) the executives have cut the budget for 2016 thereby preventing IT from providing said applications, and
– (3) the same executives are now spending their own divisional money on non-IT provided applications.

And then to ask the question: What should we do at our firm in light of these dynamics? Do we embrace shadow IT as a formal IT strategy going forward, or do we do something different?

How have you dealt with shadow IT from a governance perspective at your firm?

Here’s a couple of perspectives from other people:
– Liam Kerney, Responding to Shadow IT in the Digital Workplace (May 2016)
– Marcus Jewell, How Should CIOs Respond to the Rise of Shadow IT? (September 2015)