How CMMC Requirements Impact Manufacturers

Summary

Cybersecurity has never been more important for manufacturers. As Industry 4.0 initiatives have grown, so have attacks against organizations in this sector. The Department of Defense’s Cybersecurity Maturity Model Certification (CMMC) is making security a more tangible business concern for many manufacturers.
 
The DoD first announced the CMMC in 2020, following it up with an updated version in 2021. While the department has yet to finalize these rules, the upcoming regulation will undoubtedly impact the manufacturing sector in a few ways. Here’s how.
 

1. Higher standards for government contractors

The CMMC is largely a measure to minimize the DoD’s data security risks. As such, all DoD contractors must comply with these standards, which fall into three tiers of increasing stringentness according to the sensitivity of the project in question. Manufacturers producing equipment for the armed forces or other DoD agencies must embrace higher security standards or lose their lucrative government contracts.
 
All CMMC tiers require basic data hygiene steps and regular assessments to ensure these methods meet acceptable standards. However, manufacturers must achieve higher levels of security and assurance to qualify for more sensitive—and, thus, profitable—DoD contracts. As a result, advanced cybersecurity measures will become a bigger differentiator in manufacturing competitiveness.
 

2. Higher standards for third-party suppliers

Government contractors are not the only ones facing greater pressure to increase their cybersecurity, either. The latest version of the CMMC framework clarifies that all external service providers must achieve a CMMC level equal to or above their clients who work for the DoD. A supplier of a DoD contractor with a Level 2 contract, for example, must also have Level 2 or Level 3 certification.
 
There are two main implications of this rule. First, even manufacturers who don’t work directly with the DoD should consider pursuing CMMC certification to become more marketable to DoD-serving clients. Failing to achieve higher-level standards could limit business opportunities for parts manufacturers.
 
Secondly, manufacturers working for the DoD must pay greater attention to their supplier network. Considering that 61% of all organizations experienced a third-party security incident in 2023, that discretion is advisable even outside of a CMMC context.
 

3. Rising need for transparency

CMMC requirements will also impact manufacturers through a greater push for transparency in the industry. Most CMMC certifications require third-party assessments to verify the organization’s security posture, naturally creating more transparency about these companies’ cybersecurity. As more manufacturers fall into that category, more of their business partners will become used to this level of assurance.
 
Likewise, the need for CMMC-compliant suppliers will mean DOD-contracted manufacturers will require more insight from third parties about their cybersecurity measures. These manufacturers may also use their certifications to surge ahead of the competition by showcasing their security standards to non-government clients, building trust.
 
As these trends continue, transparency about security practices will become more crucial as a way to gain clients and build trust. Manufacturers experienced 25.7% of all cyberattacks in 2023—more than any other industry—so businesses relying on the sector will expect more from their manufacturing partners.
 

Recommended actions for manufacturers

In light of these upcoming changes, manufacturers should take action regarding the CMMC. Businesses relying on government contracts or hoping to secure them in the future should embrace higher standards today.
 
While the CMMC’s final rules are not out yet, Level 2 is equivalent to NIST SP 800-171 and Level 3 is based on NIST SP 800-172. Manufacturers can use these existing standards to compare their security posture to the DoD’s future expectations.
 
CMMC compliance may not be necessary for manufacturers not working with the DoD, but achieving equivalent standards is a good idea. Third-party certification of these higher levels will make businesses more competitive as CMMC compliance and transparency become bigger concerns. Achieving these standards will also open the door to work with other manufacturers who do work for the DoD.
 
Transparency is crucial across the entire industry, not just government contractors. Third-party certifications are an excellent way to provide that visibility but are not the only ones. Manufacturers can also perform thorough cybersecurity audits and keep detailed records to prove their security and reliability to future clients.
 

Manufacturers must adapt to the CMMC

The CMMC will transform the manufacturing industry’s stance on cybersecurity. Standards will rise for both DoD contractors and non-government-affiliated companies alike.
 
While this shift is a beneficial one, it requires adjustment. Manufacturers should prepare for this future now by embracing higher security standards and fostering transparency around these measures.