Every company’s digital transformation process involves going paperless, moving from paper documents to digital or electronic records in their business operations. There are many benefits of eliminating paper documents from business processes: you become more agile, streamline your workflows, reduce risk, and increase transparency.
Digitizing documents is much easier today using optical character recognition or OCR software. Virtually every office has a document scanner and smartphone cameras you can use as portable scanners.
These all utilize OCR technology to capture data on a paper document and save it as an electronic document. Let’s look at what is optical character recognition is and how it can benefit your business.
What is OCR?
Optical character recognition, or OCR in short, is a type of technology that essentially captures text from an image. The text can be printed, handwritten, or typed, and the OCR technology converts the characters into machine-readable text. This machine-readable data makes it easy for you to edit, search, filter, and run many other data processing tasks on your computer.
Think of a paper invoice scanned into an image or PDF format. You cannot edit the text data if you need to manipulate any fields on the document, such as the customer’s name and contact details.
The only way to capture this data in a digital format is to type the data into a word processor or spreadsheet manually. OCR software completely eliminates this manual process. OCR uses intelligent character recognition to extract text data from the invoice and save it in an editable format.
OCR technology isn’t new-it became popular in the early ’90s with the digitization of historical newspapers. Over the decades, this technology has grown from rudimentary scanning to near-perfect text recognition in multiple languages.
Today, anyone who needs to capture data from any paper document can use an OCR solution instead of manually retyping the text.
Types of OCR Technology
There are different types of OCR software that serve a range of documents:
ICR or Intelligent Character Recognition: This detects handwritten text one character at a time and builds a constantly evolving database through machine learning.
IWR, or Intelligent Word Recognition, detects handwritten text as clusters of words, not individual letters.
OWR or Optical Word Recognition detects typed text as words, not individual characters.
OMR or Optical Mark Recognition: This detects marks or patterns, such as underscores or comments that show human input on a printed document.
All these fall under OCR technology, but their applications may vary. For example, a written exam paper may need all these OCR techniques to scan the printed questions, the student’s handwritten answers, and the teacher’s marking and scoring. On the other hand, a printed invoice may be less demanding on the OCR software since the text is uniform and easy to scan.
What is OCR Software Used For?
OCR software has numerous use cases because we handle paper documents almost every day. You will encounter OCR software in the following contexts:
Education: As mentioned above, schools may need to scan exam papers for record-keeping and student monitoring.
Banking: Loan documents you typically fill in by hand, and lenders must digitize these forms to keep secure copies on their servers.
Mailroom management: Any business that handles parcels, from student applications to food delivery, needs an OCR engine to capture the package data as they arrive.
Insurance: Healthcare, automotive, property, and other insurance services need OCR software to process application documents.
Human resources: Businesses constantly handle resumés, employment contracts, employer statements, and other paperwork requiring OCR data extraction.
What Are The Benefits Of OCR Software In A Business?
No matter the industry, OCR software offers excellent benefits in terms of data management and streamlining business processes.
Save Time And Resources On Data Entry.
An OCR engine is 40 times faster than manual data entry, even if a business has the best team of typists that money can buy. For example, a human data entry clerk can manage a couple of hundred characters per minute, but an OCR solution can recognize thousands of characters per second.
Better Data Accessibility
It’s not enough to save documents as scanned PDF or JPG formats. These formats hold unusable data in many cases because the text content you cannot edit or index. OCR software technology allows you to access all of your data. It means that you can search for the proper documents, repurpose text within each document, and channel the data into other systems across the business.
Manual data entry is prone to human error, which causes severe damage to a business. Data entry is time-consuming and tedious, so it’s best to integrate an automated OCR engine that works fast and efficiently. Since OCR software relies on machine learning, it can be programmed to build upon its database and increase accuracy with greater use.
Better Scanning Hardware
An OCR engine works in tandem with an optical scanner to capture document data. The technology has grown from the typical desktop scanner to high-quality smartphone cameras that capture document details in high resolution. As imaging technology improves, OCR software will also increase its data processing efficiency.
Increased Customer Satisfaction
OCR software makes data easily accessible, meaning that you can search for customer information much faster than scanning through the paperwork. It translates to a significantly reduced waiting time for your customers, which leads to a better customer experience. Using OCR software can increase customer loyalty and boost conversion rates.
How to Use Extracted Data from OCR Software
Once you integrate an OCR solution into your business, all your scanned documents will yield more usable data than you can imagine. Use a parsing solution like Parserr to channel the OCR data to your spreadsheet or CRM program.
You can fully automate your data management process right from scanning a business card for contact information, all the way to lead management, market forecasting, and plenty more business functions. For more information about how Parserr benefits your business, contact us today.