Digitalization describes the introduction and usage of digital technologies in a social, individual, and organizational context [1
]. In 2018, a survey of 3958 information technology (IT) leaders revealed that 61% see higher revenue growth than their competition when using digital technologies [2
]. To achieve competitive advantage through digitalization, organizations have to massively transform their organizational structures, strategies, methods, business models, and enterprise architectures [1
]. In the past, the implementation of new IT was mainly the task of the organization and the IT department; nowadays, user-friendly IT allows business units to shape digitalization [3
]. If the business unit implements a new IT system on its own without a central IT department being involved during the development or the subsequent control, the phenomenon is called shadow IT [4
]. The effect of shadow IT on the enterprise architecture of an organization has two perspectives: On the one hand, shadow IT introduces innovation into an organization and allows a higher flexibility for business units [5
]. On the other hand, inefficiencies occur [7
]: The heterogeneity rises, because business units choose technology on their own. Complexity increases, because shadow IT is connected or exists parallel to formal systems. Integration, by linking or unifying shadow IT and the redundant enterprise system, could eliminate redundancies and solve associated problems [8
]. A survey of 490 CIOs revealed that 64% regard IT integration as a priority, while simultaneously desiring a high degree of innovation and flexibility in the IT architecture of their organization [9
]. Thereby, organizations find themselves in an area of conflict, as IT integration might eliminate the benefits that shadow IT offers [10
]. Because organizations must be aware of these drawbacks before performing an IT integration, this paper aims at presenting a framework for shadow IT integration drawbacks.
Most studies on IT integration focus on the benefits and provide classifications for its factors [11
]. Research on IT integration drawbacks focuses merely on monetary factors such as indirect and direct costs [12
], or states that some integration technologies are more expensive than others [14
]. Research on non-monetary factors considers IT integration barriers in environments such as hospitals [16
] or governments [17
] or for special methods like enterprise application integration (EAI) [15
]. Thereby, none of these studies focus on the phenomenon of shadow IT [11
]. Additionally, IT integration research in general lacks a link with the existing theory base [19
]. Therefore, this paper contributes to the scientific discussion as it presents a theory-based view of shadow IT integration drawbacks using the systemic theories of path dependency and switching costs. Besides, practitioners can use the resulting framework to assess the drawbacks when coming to a decision on shadow IT integration.
The paper is structured as follows: At first, we introduce the problem that shadow IT causes in the enterprise architecture. Then, we illustrate our research approach consisting of our systemic theory base and the literature review that we conducted. Afterwards, we present the results and discuss them. Finally, we provide a conclusion and note possible future research directions.
2. Shadow IT in the Enterprise Architecture
Shadow IT describes IT systems that business units implement individually in their business processes, whereby they are not involved in an organizational IT management [20
]. On the one hand, it has technological aspects because shadow IT occurs in various forms, such as local applications, spreadsheets, end devices, cloud services, or combined solutions [5
], and needs technical support to function in an organization [6
]. Yet, shadow IT also has social components because business employees are highly involved during its implementation and usage [21
]. Therefore, we regard shadow IT as a socio-technical phenomenon [4
In the beginning, shadow IT is often experimental and small, as it responds to an emergent need in the business unit [5
]. Once established in the organization, shadow IT can grow large because business units share the benefits that the system provides for them [23
]. Due to inertia on an individual as well as an organizational level, business users continue using shadow IT [22
]. Thereby, it often gets intertwined with the enterprise architecture of an organization [24
]. Shadow IT reinforces by emerging and reemerging in a cycle of time and cost pressures [4
]. Thereby, it shapes the enterprise architecture and can become an important part of it [25
]. Shadow IT exists alongside formal enterprise systems and either complements, expands, or supplements them [26
]. Studies show that a redundancy of data or functionality exists in a majority of the cases [26
], and that as a result shadow IT causes various inefficiencies in the enterprise architecture [7
]: First, IT departments often do not know about shadow IT, which leads to an non-transparent enterprise architecture, the inability to manage it, and related risks. Second, responsibilities are often unclear, which reduces business-IT-alignment. Third, shadow IT increases the complexity of the enterprise architecture in various ways. The low standardization and integration and high heterogeneity prevent automation [10
] and thereby hinder digitalization [27
Organizations can solve these inefficiencies by converting shadow IT into business-managed IT. Thereby, they identify and include shadow IT in IT management [5
]. However, redundancies of shadow IT and enterprise systems will remain, and organizations must take architectural measures to solve them. IT integration is an established concept to cope with these types of problems [16
]. A common database or data interface can solve data redundancies, and a unification of shadow IT and the redundant enterprise system can remove functional redundancies [8
Like in other IT integration decisions [30
], organizations must valuate drawbacks and benefits of an integration of shadow IT and the redundant enterprise system. While many studies analyze IT integration benefits, no study discusses the drawbacks [11
]. Some studies provide a classification based on direct costs, such as the implementation of the IT integration, and indirect costs such as training of employees [12
]. Others compare different costs for different integration technologies, such as interfaces and unification of systems [14
] or methods such as EAI versus point-to-point integration [17
]. A discussion of non-monetary costs exists in the analysis of IT integration barriers. Here, research presents barriers that can occur during integrating systems, such as resistance to change [18
] or technical incompatibility [32
]. Overall, research lacks a synthesis of the discussions on monetary and non-monetary costs and a theory-based specification of these drawbacks to the phenomenon of shadow IT. Shadow IT research has started to target integration by pointing out redundancies [26
] or providing evidence based on a small number of cases [27
]. None of the research on shadow IT integration has presented a theory-base yet, and IT integration research lacks that in general [19
]. Additionally, existing research on IT integration focuses on the benefits of an IT integration [11
]. By providing a theory-based synthesis of the drawbacks, we can close this research gap. As a result, organizations can weigh the drawbacks against the benefits to come to an integration decision of shadow IT and enterprise systems. To be able to achieve this goal, we pose the following research question: Which drawbacks do organizations face when deciding about the integration of shadow IT and an enterprise system?
5. Conclusions and Future Research
The goal of this paper was to present a conceptual framework of shadow IT integration drawbacks. To reach this goal, we conducted a literature review on IT integration costs and barriers but also on shadow IT benefits to be able to capture the particularities of shadow IT. As a result, we developed a framework of shadow IT integration drawbacks based on the concept of switching costs in the context of path dependency. The framework is multi-dimensional and includes organizational-technical factors as well as factors of global and local influences.
Practitioners can use our framework during the process of deciding whether to integrate shadow IT and an enterprise system. They can collect evidence following the presented criteria. The switching cost dimension helps to identify what type of drawback a specific factor causes, which organizations can then target using financial resources, change management, planning of resources, and choosing the right integration technology. The global-local perspective helps to identify and target the appropriate stakeholders.
We theoretically contribute to IT integration research by integrating the research streams of costs and barriers. Additionally, we enhance the research on shadow IT that can use this framework when coming to an IT integration decision. Besides, research can benefit from our framework to tackle the problems of digitalization that have to weigh letting business units innovate and integrating IT systems for data integrity in the enterprise architecture. Furthermore, the framework is based on the concept of path dependency and introduces this theory in the context of an IT integration decision.
Certain limitations are also present in our research upon which future research can be based. First, the framework presents factors but no measurement for these factors. Therefore, further studies may provide a measurement. Second, although based mainly on literature on case study research, the framework is only conceptual. It has not been evaluated in practice, which should be a focus of future research. Third, to come to an IT integration decision, the drawbacks must be integrated with the benefits of shadow IT integration. Future studies might develop a framework that includes the benefits as well as the drawbacks to gain a holistic view of shadow IT integration.