CMMC: Market Correction for the Cybersecurity Supply Chain

Espionage isn’t just targeting the Pentagon. It’s targeting the Defense Industrial Base.

Nation-state actors and criminal groups are bypassing hardened federal systems and focusing instead on smaller, more vulnerable defense contractors. These suppliers—many of whom are small and mid-sized businesses—form the digital perimeter of national defense. And that perimeter is under siege.

For years, defense contractors have attested to their cybersecurity practices under DFARS clauses. But the Department of Defense has made it clear: attestation is no longer enough—proof of CMMC compliance is now required.

Enter the Cybersecurity Maturity Model Certification, or CMMC.

The Cybersecurity Challenge Behind CMMC Compliance

Cybersecurity is a critical concern for businesses today, but for many, it’s not a central part of daily operations. Often viewed as a cost that reduces margins without generating revenue, cybersecurity is treated as a necessary expense rather than a driver of growth. To manage this burden, many companies outsource cybersecurity to IT and service providers.

Choosing a provider, however, is not straightforward. How can a company assess the effectiveness of a provider’s solutions or expertise in a constantly evolving field? This uncertainty is what makes the cybersecurity marketplace a textbook example of an asymmetric information market—similar to George Akerlof’s "market for lemons" metaphor.

CMMC compliance is designed to address these asymmetries, establishing clear, enforceable standards across the Defense Industrial Base.

A Market for Lemons: Why CMMC Compliance Was Inevitable

In his 1970 paper The Market for Lemons, economist George Akerlof described a market where buyers and sellers have unequal information, leading to inefficiencies. Using used cars as an example, he noted that buyers struggle to distinguish reliable cars (“peaches”) from defective ones (“lemons”), because sellers know more about the car’s condition. This lack of trust drives down prices, pushing high-quality sellers out and leaving mostly lemons.

The cybersecurity marketplace operates similarly. Companies seeking cybersecurity solutions—software, managed services, or consulting—often lack the expertise to evaluate providers' offerings. Providers, meanwhile, have detailed knowledge of their services, but their claims about "advanced technology" or "complete protection" are difficult to verify. This asymmetry makes it hard for businesses to identify competent providers, creating a market where quality is uncertain.

CMMC compliance emerged as the Department of Defense’s solution to restore trust, transparency, and quality assurance in the cybersecurity supply chain.

The Era of Enforcement Has Begun

Just as CMMC compliance raises the bar for verification, the federal government is getting serious about enforcement. The Department of Justice has invoked the False Claims Act under its Civil Cyber-Fraud Initiative and has already begun investigating—and in some cases, penalizing—contractors who misrepresented their cybersecurity postures under DFARS self-attestations.

This shift signals a new era: misleading claims about cybersecurity can now trigger fines, investigations, and debarment. It’s no longer a matter of “check the box and hope”—there are now legal and financial consequences for firms that claim CMMC compliance but can’t back it up.

Trust, transparency, and verifiable evidence are no longer optional. They are operational and legal imperatives.

Choosing the Right Path to CMMC Compliance

There is no one-size-fits-all approach to achieving CMMC compliance. Organizations must choose a strategy that aligns with their operations, risk tolerance, and exposure to Controlled Unclassified Information (CUI). Broadly, there are three practical models:

• Enclave: Best for businesses with limited CUI. You isolate sensitive functions in a purpose-built, compliant environment.

• Uplift: For businesses with deeper integration or legacy infrastructure, this means modernizing current systems to meet standards.

• Greenfield: When existing networks are too far gone, it may be more efficient to build a clean, compliant environment and migrate into it.

The right path to CMMC compliance depends on several factors:

• The percentage of revenue tied to DoD contracts

• The number of personnel who interact with CUI

• The type of CUI handled (e.g., ITAR, NARA)

• The presence of non-U.S. persons in the organization or support staff abroad

Each of these impacts everything from your system architecture decisions to whether Microsoft 365 GCC or GCC High is appropriate for your environment.

Evaluating Partners: Avoiding Lemons in the Compliance Marketplace

Just like cybersecurity itself, CMMC compliance has become its own marketplace. And once again, the "lemons" are out there—promising silver bullets and easy buttons.

To avoid them, organizations should ask critical questions when evaluating potential partners:

• How many customers has the provider successfully brought through a formal CMMC assessment?

• What are their clients’ SPRS scores?

• Which controls are fully inherited vs. customer-responsible?

• Do they supply audit-ready documentation?

• Will they represent you during the assessment process?

• Do they offer ongoing monitoring and support, or just initial setup?

Choosing the wrong partner isn’t just an inconvenience—it could be the difference between certification and failure in your journey to CMMC compliance.

Containment: The Next Battle in CMMC Compliance

Even with the right environment and the right partner, success depends on what happens next. Organizations must not only achieve CMMC compliance, but sustain it.

Key ongoing tasks include:

• Identifying CUI

• Moving it into the secure environment

• Keeping it there without accidental exposure

Spillage is a major risk. If CUI is accidentally emailed, printed, or saved outside the secure boundary, that’s a reportable event—unless you have a clearly defined spillage and remediation plan. Without one, every mistake becomes a compliance incident.

The ability to identify, isolate, and contain CUI is essential—not just for CMMC certification, but for operational continuity and business reputation.

Final Thoughts

CMMC compliance is not just another DoD mandate—it’s a true market correction. It brings clarity to a cybersecurity landscape that had become clouded by noise, misrepresentation, and hollow assurances.

Whether your organization chooses to uplift, isolate, or rebuild, your path to CMMC compliance must fit your business profile. And your partners must be able to stand behind their solution—not just with technology, but with results, accountability, and legal defensibility.

If you’re not sure where to start or how to navigate the complexities of CMMC compliance, we’re here to help!