The common definition of Interoperability is that of “the functional testing of a product against another product according to a set of test specifications”. Unfortunately, this definition does not meet RFID requirements. The primary reason for it is that RFID implementations consist of a system of hardware, data and software. RFID tags communicate with readers and exchange data using air interface protocols. Software facilities communications between readers, RFID middleware, and enterprise applications such as ERPs and WMS.

Any component of the RFID system may cause interoperability issues that could affect implementation. An interoperable RFID system typically consists of three components:

1. RFID Hardware consisting of a system of tags, readers, printers/applicators.
2. Software consisting of reader management software and RFID Middleware. RFID Middleware consists of applications that collect and filter event data, add business context to it, and interface with enterprise applications such as ERP or WMS.
3. Data which is stored on tags or collected from tags with additional business context data. The data will always include an identification of a tagged item using keys such as EPC, UID or others. Additional data processed may include RTLS, sensor, and user data.