Case Study: Is there a cybersecurity industry?
Case Scenario:
You recently joined a small start-up company that has developed a suite of cybersecurity products that integrate network sensors (hardware) with big data analytics (software) to provide advanced threat detection at an affordable price.As is often the case with small companies, you are expected to lend your hand to whatever task needs doing. Yesterday, you were helping to write the online product brochures and other marketing materials. Today, your tasks include adding the North American Industry Classification System (NAICS)code(s)for the "cybersecurity" industry to the company's Website.As you delve into the matter, you quickly discover that there is no NAICS code for a "cybersecurity" industry(see https://www.census.gov/cgi-bin/sssd/naics/naicsrch?chart=2012).After additional research, you learned that the NAICS codes for your company's direct competitors (companies selling similarcybersecurity products) included the following:
• Computer and Electronic Product Manufacturing (NAICS prefix "334")
o Computer Terminal and Other Computer Peripheral Equipment Manufacturing
o Computer Storage Device Manufacturing
• Information Industry (NAICS prefix "51")
o Custom Computer Programming Services
o Software Publishers
• Professional, Scientific, and Technical Services Industry (NAICS prefix "54")
o Computer Systems Design Services
o Electronic Stores
• Retail Trade (NAICS prefix "44")
o Electronic Stores
You also learned that the NAICS system was designed to be production or product oriented and that provisions exist for adding new or emerging industriesto the NAICS classification system (see NAICS Update Process Fact Sheet, p. 4, section "The Four Principles of NAICS" https://www.census.gov/eos/www/naics/reference_files_tools/NAICS_Update_Process_Fact_Sheet.pdf)
Your team leader has asked you to write a short report detailing your findings andrecommending which industry your company should declare as its primary industry (out of the four listed above). Your report should include a justification for your selection. Your team leader has also asked you to provide a well-reasoned explanation as to why "cybersecurity" isconsidered an industry by many reporters and market analysts but is not listed as a unique industry under NAICS.
NAICS codes are incorporated into many business directory listings, independent financial reports / market analyses, and credit reports. Many large organizations, especially government agencies, require that a company have both a Dun & Bradstreet Data Universal Numbering System (D-U-N-S) number and one or more NAICS codes assigned to the company prior to being listed as an approved supplier.
Research:
1. Read / Review the Week 5 readings. Pay close attention to those readings which provide evidence that "cybersecurity" is, in fact, an industry.
2. Research additional information about industry classifications, why they were developed, and how they are used. Here are some suggested sources:
a. https://www.naics.com/history-naics-code/
b. https://www.naics.com/naicswp2014/wp-content/uploads/2014/10/How_to_Use_NAICS_SIC_Codes_for_Marketing_NAICSAssociation.pdf?
c. https://www.bls.gov/bls/naics.htm
d. https://www.census.gov/eos/www/naics/reference_files_tools/NAICS_Update_Process_Fact_Sheet.pdf (See page 4: "The Four Principles of NAICS" Principles #1 & #2)
3. Find three or more additional sources which provide evidence that "cybersecurity" is or is not a distinct industry.
Write:
Using standard terminology (see case study #1), write a two to three page summary of your research. At a minimum, your summary must include the following:
1. Introduction which includes a well-reasoned explanation as to why "cybersecurity" is considered an industry by many reporters and market analysts but is not listed as a unique industry under NAICS.Your introduction should include an explanation of the importance of standardized industry classification codes (who uses them and why).
2. Analysis and discussion of one or more industry codes which could be used by your cybersecurity company (based upon the product listed in this assignment). The discussion should include a comparison between your company's business activities and the industry characteristics for the four classification families listed in this assignment (prefixes 334, 44, 51, & 54).
3. Recommendation for the best fit for a single NAICS code to be used by your company on its website and included in its business directory listings and financial reports.