Today's RFID technology is an increasingly popular alternative to the standard bar code. Whereas a bar code requires line of sight – a scanner or person to read the lines or numbers -- an RFID tag uses electromagnetic waves to communicate with a RFID reader, which in turn communicates with a company’s database (computers), and can be read at much greater distances than bar codes. Each product is given its own, unique IP address.

While RFID adoption continues to be driven primarily by retail-mandate compliance (45 percent), competitive advantage came in a close second (38 percent). More than half of the respondents believed that their RFID initiatives have significant implications on cost reduction and asset efficiency improvements in their supply chain.

"While compliance-driven implementation is natural, the survey clearly shows that the future holds immense potential for companies choosing to invest in RFID as a strategic differentiator," said Sateesh Seetharamiah, RFID Solution Leader, Infosys Technologies Ltd. "Although there seem to be disparate levels of adoption and expectations from RFID programs, there is a consensus that RFID can most certainly strengthen supply chain efficiencies in the long-run."

While there is substantial interest in adopting RFID, most respondents believe that there are significant technology challenges to be overcome (42 percent), such as the still-evolving RFID standards and the remaining technical implementation challenges. The cost of implementation came up as the second biggest hurdle in RFID adoption.

Eighty-two percent of respondents agreed that rapid deployment is important for the success of RFID programs while 72 percent emphasized the need for vendors with global delivery capabilities.

"The survey findings validate Infosys' solution approach which leverages existing technology to deliver rapid deployment and lower cost of roll-out, coupled with scalability, even in compliance-driven investments," Sateesh noted.