How Document Conversion & Digital Imaging Saves Companies Time Money & Automates Paper Processing

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Author Kevin V. McQueen- Internet Fax Document Management Service professional

Using OCR technology for document conversion saves companies time and money because it reduces manual data entry of form data and saves time when accessing the form as a digitized document versus a paper document. Additionally, as accuracy rates are increased and mistakes reduced, so are the soft cost caused by mistakes.

Reducing manual data entry can be achieved either with OCR software as a premise solution, or by using an OCR Service as an outsourced solution. There is much written today about SaaS and cloud computing as software functionality is being pushed off the premise. When considering OCR as a service, it´s about pushing the functionality into the cloud, or to a Service Bureau, allowing them to extract the data from the digitized form, and giving it back to their customer for digital uploading into their computer system. The images can be transferred via web services or FTP as a few examples. This type of service can also have components of SaaS in the form of web based digital archiving and exception management. Using OCR to extract critical fields eliminates the time needed to key data into another system like an ERP system or accounting software package and can result in substantial savings.

Digitizing paper and storing in a digital archiving system also provides and much more efficient and secure means of accessing the stored documents. Digitized documents can be searched for and founds in seconds compared to minutes for paper. Access to the documents can be role based with passwords providing a means of digital tracking for any access to the document. Additionally, the space allocated for filing cabinets shares a cost allocation in the form of rent or opportunity cost for not utilizing the space for another function.

According to a study produced by Coopers & Lybrand, the average cost for processing a form is $20 dollars. According to the Dartnell Institute, the average amount of time to access a paper form from a filing cabinet is 7 minutes, and 3 minutes to return it. The average time to access a digital form is 4 seconds. What about the cost of a lost document? According to the same Coopers & Lybrand study, finding a misfiled or lost form can cost $120 dollars, reproducing that lost form cost an average of $220 dollars. The savings comes from three major components;

1. Elimination of staff performing manual data entry of forms

2. More efficient access to forms that have been digitized

3. Elimination of soft cost caused by mistakes from data entry errors

What kinds of applications are using document conversion to gain efficiencies? Based on our experience, a wide variety of paper is still being processed manually and can benefit from document conversion. Purchase orders, freight orders, bills of lading, pick tickets, driver tickets, EOB´s

timecards, invoices both for payables and receivables, enrollment forms, trade confirmations, ect… Our economy holds a vast amount of opportunities to gain efficiencies through the elimination of manual paper processing.

ROI versus cost benefit analysis comes down to three choices.

• The cost of doing nothing and continuing manual paper processing

• The cost of purchasing, provisioning, and maintaining software and hardware for an OCR premise solution

• The cost of paying an OCR Service Bureau for data extraction based on transactions

For more information or general questions you can contact me . I have worked in Product Management and in Business development positions for Internet fax and Document Management Services for the past 10 years. I am biased toward outsourcing non-core business functions as it allows companies to focus on their core and reduce non-core related cost, but I am happy to facilitate an intelligent comparison.

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