Optical Character Recognition (OCR) technology has revolutionized how companies digitally capture, store, and share information. In a nutshell, OCR converts information on print documents into text that computers can read and process, giving user real-time accessibility to the data for reviewing, editing, and sharing.
With OCR, information is stored much faster and more efficiently than human data entry, bringing business decision-makers peace of mind that the data they’re working with is as accurate as possible.
How Does OCR Invoice Processing Work?
The OCR process only takes a second or two to complete, but in that short time frame, four intricate steps are taken in the background to extract the information from the document and convert it into machine-readable text.
Let’s look at those four steps, using an accounts payable (AP) staff member entering an invoice into an automated AP system as an example.
1. Invoice scanning
This initial step involves the AP team member scanning an invoice they received from a supplier into their automated AP system. Although most invoices are computer generated, OCR technology is so robust that, in most cases, it can also scan and read handwritten documents with unparalleled accuracy.
2. OCR preprocessing
During this part of the process, the OCR system begins preprocessing the scanned image so the information can be extracted efficiently. For example, if the invoice has various font sizes and styles, OCR’s preprocessing techniques will standardize the text for consistent and reliable character recognition. Also, if the invoice was scanned under uneven lighting conditions, OCR will adjust the image’s background to improve text legibility.
3. Pattern matching
The next step involves the OCR system comparing the visual patterns of the text on the invoice with its internal database of characters and symbols, helping it accurately capture each invoice character. The internal algorithms also identify key character patterns for different font formats, such as numbers, dates, and dollar amounts.
4. Error correction
The final stage of the OCR process involves correcting any anomalies in the text before assembling recognized characters into coherent words and sentences. For example, if the system identifies ambiguous characters on the invoice, OCR’s algorithms will contextually analyze the surrounding text to make corrections.
After the OCR system completes these four steps, your AP team will be able to access the data from your AP system’s secure cloud storage platform and send it for online approval.
What are the benefits of OCR invoice processing?
OCR invoice processing offers your AP team several significant advantages that help optimize your overall business operations as a whole, including:
Increased Data Accuracy
Data entry errors can trigger time and labour-intensive audits or slow down payment processing, potentially harming supplier relationships. OCR technology virtually eliminates the risk of inaccurate data due to human input error. Additionally, leadership teams will be able to confidently make strategic decisions based on accurate, real-time data.
Time and Cost Savings
An automated AP system with OCR technology streamlines the entire AP system, enabling invoices to be processed in hours instead of days or weeks with a manual system. This optimization lets your AP team focus on value-added tasks that increase productivity gains. It also gives you the opportunity to take advantage of early payment discounts and avoid late payment fees, all adding to your company’s bottom line.
Improved Efficiency
Your overall AP department’s efficiency is significantly boosted with OCR technology within an automated AP system, as it eliminates manual data entry and places all data in a secure cloud storage system. Managers can access the invoice for approval and send it for payment far faster than with manual paper invoice processing.
Enhanced Data Security
Paper invoices offer little in terms of data security, as they can be easily lost or misfiled. With an automated AP system, the data extracted using the OCR process is immediately stored in a secure cloud platform where only relevant stakeholders can access it through encrypted password technology.
What are the different types of OCR invoice processing solutions?
For over 40 years, Ash Conversions International (ACI) has specialized in transforming how companies run their daily business processes with efficient, cost-effective AP automation solutions that provide complete AP invoice visibility and accurate data capture using OCR technology.
We provide two customizable invoice processing solutions that offer easy invoice routing for approvals, one centralized cloud-based location for invoice processing and retrieval, robust workflow reporting, and much more – all while building your company’s bottom line.
ACI’s AP AssistantTM Enterprise Solution
AP AssistantTM is specially designed for large enterprises, cutting 80 percent of their AP team’s workload. This solution processes invoices automatically with a touchless invoice rate of up to 95 percent, scales easily as your business grows, eliminates compliance and financial risks, and offers many more profit-building benefits.
ACI’s AP Assistant LITETM SMB Solution
A popular choice with SMBs, AP Assistant LITETM provides a “right size” level of automation tailored to the company’s needs. It offers one centralized location for all invoice processing and retrieval needs, a complete audit trail, robust reporting, and many additional features designed to reduce expenses and optimize profitability.
Ask an ACI AP automation solution expert about which solution would be best for your organization!
Explore OCR invoice processing solutions from Ash Conversions International
When you’re ready to maximize growth opportunities and save money with an AP automation solution featuring OCR technology, call Ash Conversions International (ACI). Our team will get you up and running quickly to help you reap the many benefits offered by one of our AP automation solutions.
For more information on how your organization can benefit by automating the accounts payable process, call us at 800-719-9621 or click the button below.
