In telecommunication, the term can be defined as:
Source: from Federal Standard 1037C and from the Department of Defense Dictionary of Military and Associated Terms in support of MIL-STD-188.
In two-way radio, interoperability is composed of three dimensions:
The ability of systems, units, or forces to provide services to and accept services from other systems, units or forces and to use the services exchanged to enable them to operate effectively together.
The condition achieved among communications-electronics systems or items of communications-electronics equipment when information or services can be exchanged directly and satisfactorily between them and/or their users. The degree of interoperability should be defined when referring to specific cases.
compatible communications paths (compatible frequencies, equipment and signaling),
radio system coverage or adequate signal strength, and;
scalable capacity. Telecommunications
With respect to software, the term interoperability is used to describe the capability of different programs to exchange data via a common set of business procedures, and to read and write the same file formats and use the same protocols. (The ability to execute the same binary code on different processor platforms is 'not' assumed to be part of the interoperability definition!) The lack of interoperability strongly implies that the described product or products were not designed with standardization in mind. Indeed, interoperability is not taken for granted in the non-standards-based portion of the computing and EDP world.
According to ISO/IEC 2382-01, Information Technology Vocabulary, Fundamental Terms, interoperability is defined as follows: "The capability to communicate, execute programs, or transfer data among various functional units in a manner that requires the user to have little or no knowledge of the unique characteristics of those units". 
This definition focuses on the technical side of interoperability, while it has also been pointed out that interoperability is often more of an organizational issue. In other words, interoperability frequently has a major impact on the organization concerned, including issues of ownership (do people want to share their data?), staff (are people prepared to undergo training?) and usability. In this context, a more apt definition is captured in the term "business process interoperability".
Interoperability can have important economic consequences, such as network externalities. If competitors' products are not interoperable (due to causes such as patents, trade secrets or coordination failures), the result may well be monopoly or market failure. For this reason, it may be prudent for user communities or governments to take steps to encourage interoperability in various situations. In the United Kingdom, for example, there is an eGovernment-based interoperability initiative called e-GIF. As far as user communities, Neutral Third Party is creating standards for business process interoperability. Another example of a neutral party is the RFC documents from the Internet Engineering Task Force (IETF).
New technologies are being introduced in hospitals and labs at an ever-increasing rate, and many of these innovations have the potential to interact synergistically if they can be integrated effectively. The need for "plug-and-play" interoperability – the ability to take a medical device out of its box and easily make it work with one's other devices – has attracted great attention from both healthcare providers and industry.
Interoperability helps patients get the most out of technology, and it also encourages innovation in the industrial sphere. When different products can be combined without complicated and expensive interfaces, small companies can enter a field and make specialized products. Without interoperability, hospitals are forced to turn to large vendors that provide suites of compatible devices but that do not specialize in any one area. Interoperability promotes competition, and competition encourages innovation and quality.
From the perspective of Intel, a major producer of consumer healthcare devices, there are six major factors that affect an industry's ability to achieve interoperability. First there needs to be a demand for interoperable products. Second, there must be standards, or rules, defining what interoperability means in the field. Third, business conditions must encourage manufacturers to make their products interoperable. Fourth, guidelines must exist that make the often-complicated standards easier for companies to interpret. Fifth, compliance must be verified by independent testing; and finally, interoperability must be actively promoted. The rapid rise of wireless technology illustrates that interoperability is attainable.
Conditions in the biomedical industry are still in the process of becoming conducive to the development of interoperable systems. A potential market of interested hospitals exists, and standards for interoperability are being developed. Nevertheless, it seems that current business conditions do not encourage manufacturers to pursue interoperability. Only sixteen to twenty percent of hospitals, for example, use electronic medical records (EMR). With such a low rate of EMR adoption, most manufacturers can get away with not investing in interoperability. In fact, not pursuing interoperability allows some of them to tout the inter-compatibility of their own products while excluding competitors. By promoting EMR adoption, companies such as Intel hope to create an environment in which hospitals will have the collective leverage to demand interoperable products.
In the medical industry, the need for interoperability is becoming severe. New technologies are being introduced at an ever-increasing rate. Many hospitals, for example, are now adopting electronic medical records, which promise to allow physicians to access more information with greater speed. In addition to electronic medical records, hospitals are continually introducing new imaging and therapeutic devices, many of which have the potential to interact synergistically if they can be integrated effectively.
The need for "plug-and-play" interoperability in a hospital setting has attracted great attention from both healthcare providers and from the biomedical industry. Hospitals and HMO's form a large market for interoperable products, and standards defining interoperability in the medical sphere are being developed by a variety of international organizations such as IHE. Despite this interest, however, many manufacturers currently avoid investing in interoperability, touting the inter-compatibility of their own products while attempting to exclude competitors.
Leaders of hospitals and healthcare organizations are slowly realizing that achieving interoperability would greatly improve healthcare. Interoperable technology enables doctors to work more efficiently, and it helps prevent mistakes. Interoperability also encourages innovation in the industrial sector by allowing small companies to introduce specialized products. Without interoperability, hospitals are forced to turn to a few large vendors. Interoperability promotes competition, and competition encourages innovation and quality. As large hospitals begin to understand this fact, efforts to promote biomedical interoperability are gathering strength.
Interoperability can be achieved in four ways: through product engineering, industry/community partnership, access to technology and IP, and implementation of standards.
Interoperability as a question of power and market dominance
Business process interoperability
Levels of conceptual interoperability
A.I. Systems Integration for interoperability of software components in artificial intelligence.
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