Interoperability explained: The key to smarter, connected systems

Interoperability is helping systems across industries collaborate without the endless copy-pasting, file conversions, or digital dead-ends. When platforms speak the same digital language, everything changes.

So, if you're building smarter, more connected solutions for the future, interoperability is essential to look at.

Interoperability refers to the ability of different systems, technologies, or organizations to exchange, interpret, and use data seamlessly. In practice, this means software applications, platforms, or databases (often from different vendors or jurisdictions) can work together without manual intervention or data silos.

Interoperability turns disconnected technologies into a unified system, making information truly usable regardless of where it comes from.

Today, organizations are increasingly dependent on collaboration. Whether it's cross-border commerce, research, or regulatory compliance, the ability to share information without sacrificing security or control is a strategic advantage.

Interoperability makes that possible. It reduces duplication, accelerates decision-making, and lowers operational friction. It also unlocks smarter automation and ensures that innovations like AI, IoT, or blockchain can work together in real-world scenarios.

Benefits of interoperability include:

• Faster and more accurate data exchange

• Reduced integration costs and complexity

• Improved transparency and auditability

• Greater scalability across systems and partners

• Stronger security through controlled data access

Consider a student with a digital student ID issued by a university. Thanks to  interoperability, that same ID works far beyond the university gates.

When a student arrives to take an exam, their identity is confirmed instantly without needing to print documents or manually input credentials. The same ID can then be used to access student discounts on public transportation, register for a gym membership, or purchase a cinema ticket, all without repetitive onboarding or the need to upload supporting documents.

In the background, systems from universities, transit authorities, entertainment providers, and third-party services communicate through shared standards and protocols. They don’t store or exchange raw data. Instead, they verify the criteria in real time while preserving privacy and control.

For organizations, this demonstrates the value of interoperability: frictionless, secure access across digital ecosystems. It enables services to scale smarter, reduce overhead, and deliver seamless user experiences without compromising compliance or data protection.

The real power of interoperability lies in enabling disparate systems to speak a common language, exchanging information as one unified entity. To truly grasp how interoperability can activate data everywhere, let's explore how it's being implemented across various industries:

Healthcare

Hospitals, labs, and insurers can use interoperable systems to share patient data securely. By implementing these solutions, they can significantly reduce duplicate testing, improve diagnostics, and ensure seamless continuity of care, particularly when patients move between providers. This leads to better patient outcomes and more efficient operations..

Supply chains

Manufacturers and logistics companies integrate systems to monitor shipments, manage inventory, and verify compliance. Blockchain-based solutions, for instance, enhance interoperability across borders while maintaining trust and traceability.

Finance

Banks and fintech platforms rely on interoperable APIs to enable services like open banking, fraud detection, and cross-border transactions, all while meeting compliance standards like PSD2 or GDPR.

Energy

Smart grids use interoperable data from sensors, energy providers, and consumers to balance supply and demand in real time, making energy systems more efficient and sustainable.

Despite its advantages, interoperability is not easy to achieve. Many organizations still deal with outdated legacy systems, proprietary formats, or siloed operations. Common challenges include:

1. Lack of standardized data formats or communication protocols

One of the biggest barriers to interoperability is the absence of universally adopted standards. Organizations often use custom-built systems or proprietary formats that don’t align with other platforms. Without shared communication protocols (like FHIR in healthcare or EDI in supply chains), data can’t flow smoothly between systems, resulting in manual workarounds, delays, and errors.

2. Security and privacy concerns when integrating with third parties

Opening systems for interoperability can create new vulnerabilities. Organizations worry about data breaches, unauthorized access, or losing control over sensitive information when collaborating with external platforms. Without privacy-preserving infrastructure, like encryption or Multi-Party Computation, sharing data securely becomes a major risk.

3. Inconsistent regulations across countries or sectors

Different regions and industries have their own rules for data protection, identity verification, and compliance. What’s acceptable in one jurisdiction may be prohibited in another. This makes cross-border or cross-sector interoperability especially challenging, as organizations must navigate a patchwork of legal requirements while maintaining functionality.

4. High costs of system upgrades or infrastructure overhauls

Legacy systems weren’t built with interoperability in mind. Updating or replacing them to support modern APIs, data schemas, or decentralized architectures can be expensive and time-consuming. Many organizations delay interoperability initiatives simply because of budget constraints or fear of disrupting critical operations.

Traditional interoperability has often depended on centralized systems, which can be platforms or services that act as gatekeepers, who are controlling access, standards, and the flow of information. While effective within a single ecosystem, this model quickly breaks down when extended across sectors, borders, or independent organizations.

Take the centralized system illustrated above: the app/service acts as both issuer and verifier of credentials.

This dual role limits scalability. Other systems can’t independently verify credentials without connecting back to the original platform, making the user’s credentials non-portable and creating data silos. Without shared protocols or distributed trust, true interoperability is difficult to achieve.

In contrast, in the decentralized system illustrated above, the infrastructure unlocks seamless interoperability.

Credentials are issued by a trusted source, stored in a user-controlled digital wallet, and verified by any third party through a common registry. Each actor operates independently but speaks the same “digital language.” No raw data is exposed, and no central platform holds the keys. This enables secure, privacy-first collaboration across domains, making interoperability not only possible, but practical at scale.

At Partisia, we enable organizations to build interoperable identity ecosystems that are secure, privacy-first, and ready for scale. Our platform combines blockchain and Multi-Party Computation (MPC) to support seamless data exchange across borders, sectors, and systems without compromising control or compliance.

And we’ve already started a real-world deployment. We’ve partnered with Toppan, a  global leader in business information management solutions, to create decentralized identity solutions that meet the highest standards of privacy, interoperability, and trust.

With our Decentralized Identity solution, you can:

• Issue and verify credentials across systems using shared standards with no central gatekeepers required

• Support user-controlled digital wallets that work across education, healthcare, finance, and more

• Enable privacy-preserving verification, where only the necessary claims are revealed, never the underlying data

• Achieve compliance with GDPR, eIDAS, and other frameworks while supporting secure, cross-border collaboration

• Establish trust with cryptographic proofs and decentralized registries, making every interaction auditable and secure

Our infrastructure helps public and private partners move beyond siloed ID systems toward interoperable networks where verified data flows securely, and users stay in control.

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