The NAICS taxonomy is based on a production-oriented, or supply-based, conceptual framework instead of an output-based framework of SIC. This means that producing units that use identical or similar production processes are grouped together in NAICS.
While many NAICS industries directly compare with SIC industries, a number of SIC industries were split or combined to form a new NAICS industry, as illustrated in this table:
The market-oriented approach to classifying companies is based on the way the company earns revenue and how customers use the company's products. These classifications are used in financial analysis and investment research.
NOTE: Be aware of terminology differences, for example, industry and sector have opposite meanings in NAICS and ICB.
The Fidelity Learning Center offers insights on understanding sectors, industries, and how to classify companies: