The state achieved when a capability is available in its minimum usefully deployable form.

For a U.S. Department of Defense military acquisition, IOC includes operating the training and maintaining parts of the overall system and is defined as attained when some organizations scheduled to receive a system have received it and have the ability to employ and maintain it.

The date at which IOC is achieved often defines the in-service date (ISD) for an associated system. Declaration of an initial operating capability may imply that the capability will be developed in the future, for example by modifications or adjustments to improve the system‘s performance, deployment of greater numbers of systems (perhaps of different types), or testing and training that permit wider application of the capability.Once the capability is fully developed, Full Operational Capability may be declared.

For example, the capability may be provided to a limited number of users with plans to provide it to all users incrementally over a period of time, possibly making changes along the way. The point at which the first users begin using the capability is IOC, with FOC achieved when all intended users have the capability.

Reference:

“Glossary of Defense Acquisition Acronyms & Terms, 14th ed.”. Defense Acquisition University. July 2012.Retrieved 2015-10-07.