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With the popularity of public cloud offerings, BYOD and personal productivity apps, rogue technology acquisitions (at least from IT’s perspective) are more pervasive than ever, creating a new focus on “Shadow IT.” Our 2012 Digital IQ study of 489 executives found that 30% of technology procurement is outside the CIO’s budget.

A wise proverb says: “If you want to go fast, go alone. If you want to go far, go together.” What if you need to go fast and far at the same time?

Those seeking speed sometimes acquire technology outside traditional IT standards and procurement processes. Then, they realize they need the CIO to populate their new platform with corporate data to power their project. In a rush to innovate, they can overlook the importance of integrating corporate systems and data to fully exploit the unsanctioned technology, reducing risk and lowering TCO. Missing the integration requirements can result in unforeseen slow downs, reducing the speed advantages that were the goal in the first place. Meanwhile, CIOs get an unwelcome surprise that racks up unforeseen risks and costs.

Understandably, the first inclination of many CIOs is to drop the hammer on deployments done in the dark. However, resisting and resenting Shadow IT will only make matters worse. Pushing back will widen the wedge between the IT department and business units and drive rogue IT deeper underground.

CIOs should go the opposite direction of what might feel natural and put themselves in the shoes of department heads. Why are they circumventing the IT department? It’s time for CIOs to meet business heads and pockets of power users on common ground and be open to what they have to say. These discussions will likely inspire CIOs to reevaluate and redefine their roles and service offerings, redoubling efforts to enhance some services while becoming an internal consultant for others better offered by 3rd parties. As a result, CIOs will be in a better position to facilitate fast and far innovation through effective partnerships with business units.

Following are five steps that CIOs can take with their whiteboards to develop a plan to outshine shadow IT.

1. Shine a Light on Shadow IT

The first thing to do is shine the flood lights on the pockets of Shadow IT that are not known. CIOs can review personal expense reports, analyze procurement data and conduct employee surveys to discover what technologies are being used, from where and why. Really understanding why business units and individuals are avoiding the IT department is critical. Do the research. Have the conversations.

2. Conduct a Gap Analysis

Overlay the list of Shadow IT technology onto your list of offerings. Where are the gaps? Is there crossover between your core competencies and the service offerings of outside providers that are being used? What are they using that you don’t offer? If the shadow services are similar, are governance and review processes all that’s in the way?

3. Re-Write your IT Menu

What do you want to provide in the future that you aren’t providing now, based on the needs of the business? Where are you better as an integrator and advisor rather than a service provider? What technologies enable your business to innovate that you should keep close to home? For example, it may make sense to outsource enterprise apps to the cloud to capitalize on the scale and to reduce costs. You may also decide you want to control technologies that directly interface with customers, so you decide to beef up UI and app design capabilities and mobile infrastructure.

4. Revamp Your SDLC

If CIOs don’t demonstrate that they are dedicated to picking up the pace of the deployment lifecycle, IT will remain hidden. Many CIOs need to be more aggressive in adopting agile processes, leverage more demos, prototypes and smaller teams and more effectively cultivate staff, so they have the resources department heads need.  Architecture skills are a necessity as the IT department will need to design customer-facing solutions on the fly, often integrating several heterogeneous internal and 3rd party systems and interfaces.

5. Increase Facetime and Communicate

First, spend more time communicating and explaining what you can do TODAY.  Some of the Shadow IT effort comes from a poor understanding of what IT can offer. As new and updated offerings are solidified and you’re capable of moving at a quicker clip, also communicate your more modern IT strategy across the enterprise. Also promote your various roles as a facilitator of 3rd party offerings - innovator, counselor and integrator.

What would you add to the list?

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