Cybersecurity isn’t just an IT concern anymore; it’s a make-or-break factor for winning defense contracts. The Department of Defense has clarified that if your company touches sensitive data, you must prove you can protect it.
Only 4% of contractors say they’re ready for CMMC certification, while nearly 15% have already lost opportunities to bid on future defense contracts. That means thousands of businesses are at risk of falling behind before the framework is fully enforced.
So the level 2 of CMMC is mandatory for companies to bid on DoD contracts, but what does it actually entail? In this guide, we’ll break down CMMC Level 2 implementation steps and what you must do to become compliant.
Why CMMC Level 2 Matters for DoD Contractors
Difference between Level 1, Level 2, and Level 3
CMMC levels refer to the maturity level of a company’s cybersecurity practices and determine its eligibility for bidding on DoD contracts.
CMMC Level 1
Basic cyber hygiene measures such as antivirus software, password management, and regular backups are required at this level. Level 1 applies to companies that only handle federal contract information (FCI).
CMMC Level 2
At this level, a company must establish and document its cybersecurity practices in accordance with specified standards. Level 2 is much stricter, requiring all 110 NIST SP 800-171 controls to safeguard Controlled Unclassified Information (CUI). Companies must also conduct regular reviews and audits to ensure compliance.
CMMC Level 3
Level 3 protects Controlled Unclassified Information (CUI) from Advanced Persistent Threats (APTs). Companies at this level must align with NIST SP 800-172, a set of 20 additional controls to protect CUI from APTs.
Why contractors and subcontractors can’t ignore Level 2
Contractors may be tempted to focus solely on achieving CMMC Level 3, as it is the highest level of certification. However, failing to meet the requirements for Level 2 can result in disqualification from bidding on contracts. Prime expects you to meet the same standards even if you’re just a subcontractor. Without Level 2, you may lose potential business opportunities and revenue. Contractors and subcontractors must obtain Level 2 certification to remain competitive in government contracting.
Protecting Controlled Unclassified Information (CUI)
The National Archives and Records Administration established the CUI program to standardize how federal agencies protect unclassified information. CUI is unclassified defense data that is sensitive, such as technical drawings, maintenance manuals, and test results. For the safety of the country and the integrity of the supply chain, it is very important to keep this information safe. Federal contractors who work with CUI must have Level 2 certification, and many state government organizations are also following this norm.
Step-by-Step CMMC Level 2 Implementation
Step 1 – Identify if you handle CUI
The first step in implementing CMMC Level 2 is determining if your organization handles Controlled Unclassified Information (CUI). CUI can include a wide range of information, such as financial, personal, or sensitive government data. Conduct a thorough review of all the types of information your organization handles and determine if any fall under the category of CUI. If so, your organization must comply with CMMC Level 2 requirements.
Step 2 – Define the scope (full vs enclave approach)
Once you have determined that your organization handles CUI, the next step is to define the scope of your compliance efforts. There are two options for scope: full or enclave.
Full Scope
The full scope approach requires your organization to comply with CMMC Level 2 requirements, meaning all systems and networks must meet the necessary security controls. This option is typically chosen by larger organizations that handle a significant amount of CUI across multiple systems and networks.
CUI enclave
The enclave scope approach allows for certain systems and networks within an organization to be designated as enclaves. Enclaves are defined as a subnetwork or system that is physically and logically separated from the rest of the organization’s network. These enclaves must still meet CMMC Level 2 requirements, but the rest of the organization’s systems and networks may only need to comply with basic security controls.
An enclave scope is commonly chosen by smaller organizations that handle less CUI and have fewer systems and networks. It allows them to focus their resources on securing critical systems and networks. While still maintaining some level of security for the rest of their infrastructure.
Step 3 – Strengthen basic cyber hygiene
Basic cyber hygiene refers to the essential cybersecurity practices every organization should implement to protect its systems and networks. These include regular software updates, strong password management, employee training on security best practices, and implementing firewalls and antivirus software.
Before diving into 110 specific cybersecurity practices, organizations should focus on strengthening their basic cyber hygiene. This will help to prevent the majority of cyber attacks and reduce the overall risk to the organization.
Step 4 – Document policies and assign responsibilities
One of the key components of a strong cybersecurity strategy is having well-documented policies in place. These policies outline the rules, guidelines, and procedures employees must follow to ensure the security and protection of the organization’s systems and data.
Write clear policies describing how you manage your data, protect it from cyber threats, and what the consequences are for not following these policies. Assign responsibilities to specific individuals or teams within the organization to ensure accountability and proper execution of these policies.
Policies should cover the following areas:
- Data Management
- Network Security
- Access Control
- Incident Response
- Employee Training and Awareness
You should also regularly review and update these policies to stay up-to-date with evolving cyber threats and new technologies.
Step 5 – Prepare for assessment
Conduct regular assessments to ensure the effectiveness of your cybersecurity policies. These assessments can help identify gaps or weaknesses in your security measures and allow you to make necessary improvements.
Some contracts allow self-assessments where you upload your results into the DoD’s SPRS system. Others require a third-party assessment by an authorized assessor. Make sure you know what assessment your contract requires and plan accordingly.
The results of these assessments may also be used to determine your company’s compliance with cybersecurity regulations and standards. This can affect your eligibility for specific contracts and may even impact your overall reputation and credibility as a business.
Common Roadblocks in Achieving CMMC Level 2 Compliance
Rising costs for small and mid-sized businesses
Many smaller firms find Level 2 compliance expensive due to costs for security tools, training, and third-party assessments. These costs can be particularly challenging for SMBs with limited resources and budgets.
Budgeting early helps prevent surprises and ensures you can keep bidding on contracts. You may also consider taking advantage of federal grant programs designed to help SMBs achieve CMMC compliance.
Complexity of implementing NIST SP 800-171 controls
Level 2 requires implementing 110 technical and procedural controls. Some of these controls may require significant investments in hardware, software, and training. For businesses with limited resources and IT expertise, this can be a complex task.
Additionally, the implementation of these controls may also require changes in business processes and practices. In some cases, it may be necessary to seek professional assistance from a cybersecurity expert or consultant to ensure proper implementation and compliance.
Cloud vendor and third-party dependencies
If you use cloud services to handle CUI, those providers must meet FedRAMP Moderate or equivalent standards. Relying on external vendors adds complexity, as their compliance directly affects your ability to achieve certification.
In many cases, cloud vendors may rely on third-party services or infrastructure to provide their services. It is essential to have a clear understanding of these dependencies and how they may impact the security of your CUI.
Best Practices to Stay Ahead of Compliance Deadlines
Start early to avoid last-minute surprises
Compliance takes months, if not years, to achieve. It is essential to start early and have a clear roadmap in place. Starting early allows time to identify gaps, train employees, and fix issues before assessments. Waiting until contracts demand certification can leave your business scrambling and losing bids.
Use an enclave model to simplify compliance
You can simplify compliance by limiting the scope of your CUI environment. Enclaves are isolated and dedicated networks that are subject to a strict set of security controls. By using an enclave model, you can reduce the number of systems that need to be compliant. With fewer systems to manage, it becomes easier to maintain compliance and identify risks.
Leverage external consultants or RPs for guidance
Not every company has cybersecurity experts in-house. If your organization lacks the resources or expertise to manage CUI compliance, you can seek assistance from external consultants or Responsible Parties (RPs). These professionals have experience in working with government contractors and can provide guidance on how to meet compliance requirements.
Sync Resource is a company that offers expert services to help organizations become compliant. We can assist with identifying CUI, analyzing security vulnerabilities, and implementing necessary controls to safeguard sensitive information.
Conclusion
CMMC Level 2 is a gateway to doing business with the Department of Defense. With only a small fraction of contractors fully prepared, now is the time to act. By understanding the requirements, assessing your current state, and implementing necessary changes, your organization can attain CMMC Level 2 compliance.
Yes, the process comes with challenges like costs, technical complexity, and reliance on vendors. But the cost is worth it. Our team at Sync Resource is ready to guide you through this process and help you achieve compliance. Contact us to learn more about how we can assist your organization with CMMC Level 2 compliance.
