With the ubiquity of high-performance mobile devices such as Apple’s iPhone and iPad, capital markets firms are having to adapt for the dispersion of how and where company business is conducted.

The most immediate and direct implication of the bring-your-own-device (BYOD) movement is a perceived loss of control by corporate IT departments. With the regulatory pendulum moving toward tighter rules, any loss of control is a worrisome development for compliance managers.

For corporate IT departments, the challenges presented by the advent of iPhones and other mobile devices are manifold.

IT departments must support applications on a variety of devices now, which is referred to as “shadow” computing.

“Shadow computing is an ill-understood phenomenon,” said Bill Murphy, chief technology officer at Blackstone, at Wednesday’s Bloomberg Enterprise Technology Summit. “The ease with shadow computing can take place without any thought given to downstream consequences is troubling.”

Mobile devices are well-suited to be the tools that interact with cloud services and applications. However, mobile devices have very different interfaces to desktop or laptop computers. Cloud applications for mobile use need to ensure they are well designed for touch screens and gestures, not mice.

“As a CIO I embrace BYOD,” said Robert Lux, chief information officer at Freddie Mac, at the Bloomberg event. “Shadow IT doesn’t mean that the users of IT are wrong. Quite the opposite: if business users have to adopt their own technology, then we’re not doing our job at the corporate IT level.

Freddie Mac has “deployed an agile corporate IT strategy, which allows business users and IT to be on the same page,”” Lux said. “It’s about being nimble and embracing new technology.”

This BYOD trend is in its nascent stages, and will continue to expand dramatically into the future creating additional pressure on already stressed infrastructure.

“There is now an opportunity for IT to engage in a dialogue with business users,” said Murphy. The best companies are those that want to empower their users to create competitive advantage.’

The mobile devices in everyday use—iPads, iPhones and other android devices—possess capabilities that are increasing at a dramatic pace.

The move toward iPhones and other mobile devices represents a paradigm shift from centrally managed services to a blended approach of centrally managed and user-managed within the corporate culture.

For investing and trading firms, the challenge presented by cloud and mobile is to be flexible enough to enable employees to do their jobs outside normal business hours, while maintaining the same level of control and oversight as is found in the office.

According to a March 2013 sturdy by Cisco Partners, the most troubling aspect for employers is that workers who use their smart phones for work have inconsistent
security habits.

Nearly 40% of BYODers don’t protect their phones with a password. So many smartphone owners are using their devices for work, yet 2 out 5 haven’t applied the most basic security protocols.

Fifty-two percent reported accessing unsecured wi-fi networks with their devices – a well-known vulnerability in the cybersecurity industry. Just last year a popular Mozilla Firefox plug-in was identified that allowed users to exploit devices that were connected to unsecured wi-fi networks.

Among password protectors, there seems to be a counterintuitive breakdown between operating systems. Fifty-four percent of Android users lock their devices with a password, while 66% of iOS users have password protection. As Android has carved out a larger market share, 53% worldwide according to Gartner, it may be grabbing a broader spectrum of customers, including a less sophisticated user set.