Fewer Labels, Greater Impact:

Clean Labeling for CMMC Compliance and Microsoft Copilot Deployment

As organizations prepare to adopt CMMC and ultimately Microsoft Copilot, one foundational element is often underestimated: data labeling. While it may seem like a backend task, the way you structure and manage sensitivity labels can add complexity to your user experience and ultimately make or break your deployment—especially in regulated and compliance-driven environments.

At Planet Technologies, we’ve worked with clients across all industries—from aerospace and defense to higher education to the public sector—who are navigating the complexities of secure AI adoption. One consistent theme? Label sprawl, inconsistent naming, and unclear hierarchies are common pitfalls that can derail even the most well-intentioned initiatives.

Why Label Hygiene Matters for CMMC Compliance

Sensitivity labels are more than just metadata—they’re the gatekeepers of your data. Identification of CUI and other controlled data is a core purpose of CMMC Compliance. They also determine what Microsoft Copilot can access, how it can be used, and whether it can be surfaced in prompts or responses. Poor label hygiene leads to misclassification, policy enforcement failures, and audit gaps. Worse, it can expose sensitive data or block legitimate business use cases.

Structure Over Sprawl

One of the most common mistakes we see is over-labeling. Organizations often create dozens of labels to cover every possible scenario. But more isn’t better. In fact, it’s worse. A lean, well-structured label taxonomy—ideally 3–5 parent labels with a few sub-labels—simplifies governance, improves user adoption, and enhances AI performance.

The Power of Fewer Labels

Fewer labels mean fewer decisions for users, which leads to more consistent application. It also makes it easier to automate classification and retention policies using Microsoft Purview. And when your labels are clean and hierarchical, Copilot can more reliably interpret and enforce access controls—especially in hybrid environments like GCC High and Commercial.

Lessons from the Field

In engagements with clients in manufacturing, government, and national security sectors, we’ve helped teams streamline their label sets, align them with compliance frameworks like CMMC and ITAR, and integrate them into their Copilot readiness plans. The result? Faster adoption, fewer errors, and stronger data protection.

Want to learn how to apply these best practices in your own organization?

On June 19, Planet held a YouAlreadyOwnIt® webinar: Best Practices for Data Labeling. We walked through real-world examples, shared tips and tricks, and answered questions about Copilot, Purview, and compliance. If you want to watch the webinar or speak with one of our experts, email [email protected].

Whether you’re just starting your CMMC Compliance journey or looking to tighten your data governance to get ready for Microsoft Copilot, this session will give you the clarity and confidence to move forward.