Dive Brief:
- Lines of business are managing more enterprise applications than IT, accounting for 56% of all company app ownership and management, up from 4% year over year, according to a report from Productiv. The company compiled and analyzed data on 30,000 applications used by 190 companies.
- Most departments use between 40 and 60 different applications, the report found. Companywide, departments use an average of over 200 apps. Security, engineering and IT departments lead the pack using the most apps, on average.
- Applications bought and managed by departments enjoy higher average engagement rates than apps provisioned directly by IT departments, according to the company's analysis.
Dive Insight:
Tech leadership is experiencing a shadow IT paradox.
Apps bought directly by the units that will use them have higher engagement rates than those handed down by IT. But the spread of sticky business applications can come at a financial and security cost.
"Every SaaS purchase outside of IT has the potential to expand a company’s security risk surface and can also drastically impact business spend, whether the CIO sees the bill or not," said Jody Shapiro, CEO and co-founder of Productiv, in an email.
Three-quarters of IT leaders say security is their top concern regarding SaaS sprawl, according to a survey published by Zluri and Pulse. Compliance (58%), costs (57%) and shadow IT (57%) follow as the main areas of concern, the survey found.
Financial consequences await businesses dealing with the unregulated use of enterprise apps. Companies with large tool sets outside of IT control deal with unregulated SaaS budgets, as well as higher ownership costs due to missed renewals, Shapiro said.
But shadow IT can lead to data exposure. Six in 10 workers admit to using unauthorized apps daily or weekly to share files with colleagues, according to the Ponemon Institute.
Business users frustrated by a growing tech project backlog often turn to deploying solutions without IT oversight. Rather than wait for in-house applications to be ready for use, business units pick up off-the-shelf software for a quicker solution.
To solve for SaaS sprawl, companies can start by regularly auditing every SaaS app used across the business, Shapiro said. Once businesses understand the SaaS tools used, the next step is to evaluate costs associated with each app and user behaviors.
