Grazing posts from the top CIOs on Twitter will quickly reveal several buzzwords, none more prominent than “Innovation.” The message is clear: CIOs are under pressure to deliver “innovation” within their organizations. Tangerine CIO Charaka Kithulegoda shared the illuminating statistic that “driving business innovation” is the number one priority for IT. What that innovation looks like and how to make it happen are not always obvious though.

The consumerization of IT has made every employee a de facto IT purchaser and decision maker. Former State of Colorado CIO Kristin Russell shared a report on cloud use in government that found agencies spend only 2% of their IT budgets on cloud services. Usage data tells a different story. The average public sector organization uses 742 cloud services, and this widespread adoption is predominantly driven by employees signing up for cloud services without consulting IT. Even the use of paid services can slip through procurement when Marketing or Sales use their own corporate credit cards to license small deployments of SaaS applications so the 2% statistic likely underestimates the percentage of IT spend on cloud services.

According to Intel CIO Kim Stevenson, shadow IT can be a prime source of innovation for CIOs. In her words, “IT isn’t transforming the workforce, what’s happening is the workforce is transforming IT.” In other words, CIOs can effectively outsource IT innovation to those who know best what tools are needed: the users. Of course, there are considerations CIOs must make to enable unsanctioned cloud. Returning to Kithulegoda’s post, security is the next word that comes up after innovation. To this end, Stevenson is switching employees over from free versions of cloud services to paid enterprise versions, preserving user experience while implementing enterprise-ready security standards like multi-factor authentication.

These efforts reward those consumer cloud services that have made the investments in security capabilities required to become enterprise-ready, a trend that gained momentum in 2014 and is set to explode in 2015. FCC CIO David Bray takes full advantage of this trend, embracing the cloud to heighten his organization’s security. Cloud services will only become more secure as they develop richer APIs,, leaving room for third-party security providers to offer even more robust visibility and controls.

The other hazard with cloud adoption on the business user level is inefficiency. Chris Curran of PWC alludes to the difficulties stemming from complexity and redundancy. Ralph Loura of HP Enterprise describes the CIO’s challenge as staying “user centric” rather than “user led.” If employees are left entirely to their own devices, CIOs may look down to discover there are so many collaboration services in use that employees can’t actually collaborate with each other. This phenomenon is driving a new concept, namely the need for cloud detox. Evaluating the cloud services employees use is a major step in improving security, with organizations that do so reducing data sent to high-risk cloud services by 82%. There is also a business case for embarking on a project like Stevenson’s. The same organizations that reduced risk also cut cloud costs by 6% through consolidation of unused licenses.

Turning Shadow IT from Concern Into Opportunity

Read this guide to learn tactics 200 companies used to decrease data sent to high-risk cloud services.

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