Modern AI-powered OCR in business can now accurately read complicated or handwritten documents over 99% of the time. Businesses save time and money as it does away with the need for human data entry and reduces errors.
The benefits of OCR are not limited to just saving time and resources. OCR has many other compelling advantages for businesses. Before we get into those benefits, let’s have a quick recap of what OCR is and how it works.
An Overview of Optical Character Recognition (OCR)
OCR turns physical data into machine-readable text through the combination of hardware and software.
Typically, the software handles complex tasks and uses artificial intelligence to apply more sophisticated character recognition skills, such as word or handwriting recognition. To print or read documents, optical scanners or specialized circuit boards are controlled by hardware.
The brilliance of OCR was never lost to the business world. Ever since the 19th century, it was around to help out and later evolved into the advanced technology it’s known for today.
When Austrian inventor Gustav Tauschek developed the first mechanical instrument to read letters and translate them into telegraph code in 1914, that is when optical character recognition (OCR) was first used. Then, in the 1950s, John Larry Kelly Jr. and his team at IBM developed a computer program that could recognize alphanumeric characters.
By the 1970s, OCR was first used to check processing systems and became a tool for businesses to process large amounts of data quickly.
Since then, OCR has transitioned into a versatile tool that helps businesses recognize complex layouts, handwritten text, and even historical documents.
How Does OCR Technology Work?
As briefly mentioned above, OCR works with a combination of optical scanning and software algorithms to recognize and interpret text on physical or digital documents.
First, the document is scanned using an optical scanner or camera, which takes a high-resolution image of the document. Then, the OCR software analyzes this image and identifies patterns that resemble letters, words, and numbers.
The software then uses advanced algorithms to convert these patterns into machine-readable text, which is easily edited and searched.
OCR is more than just turning paper into digital text. It’s changing how businesses work, making things faster, more accurate, and more accessible. It’s not just about saving money; it’s about shaping a more efficient and inclusive future.
7 Key Benefits of Using OCR in Business
Let’s take a look at some key benefits of OCR that make business operations better:
Benefit # 1 Increased Efficiency and Productivity
OCR helps businesses to be at the top of productivity. It scans and digitizes documents easily and quickly. OCR systems extract information from thousands of paper or digital documents in minutes. This speeds up the entire work process, and a little bit of automation in these areas benefits businesses with 9% cost savings.
For example, let’s talk about a logistics company dealing with countless delivery receipts. That company can leverage OCR to convert their paper documents into digital records. This process, which traditionally could take hours or days of manual data entry, can now be completed in mere minutes with OCR technology.
Benefit # 2 Cost Savings
OCR services for businesses eliminate manual data entry, saving tons of money and time. Companies no longer need to hire data entry clerks and pay huge salaries to type out information from paper-based documents.
OCR-digitized data is easy to search and edit, which helps reduce the cost of physical storage space and makes document retrieval more efficient. Converting physical documents into digital data also saves business costs associated with paper, ink, and storage supplies.
Benefit # 3 Improved Data Accuracy
The OCR system offers a reliable solution for accurate and precise data extraction. It outperforms manual data entry by efficiently converting scanned documents into digital text. This eliminates the potential for human errors and streamlines the process of digitizing content.
An excellent example of OCR’s contribution to data accuracy is in the healthcare sector. Hospitals and clinics that adopt OCR technology can convert patient forms, prescriptions, and medical records into digitized versions with near-perfect accuracy.
Benefit # 4 Fast Document Processing
OCR system allows batch processing, meaning multiple documents can be scanned and digitized at once. It resolves and scans multiple stacks of documents in a few seconds, reducing document processing time.
The swift processing capacity of OCR can be seen in sectors like banking, where time is of the essence. For example, banks are flooded with countless tax documents during the tax season. Using OCR, bankers can digitize these documents and reduce the turnaround time for processing client tax filings.
Benefit # 5 Better Accessibility
OCR technology makes documents easily accessible to everyone, including those with visual impairments. Scanned documents with OCR are quickly converted into audio or braille formats.
For instance, the American Council of the Blind has partnered with various technology companies to incorporate OCR into reading devices for visually impaired individuals. These devices can scan printed material and immediately convert it into spoken words or braille, allowing users to ‘read’ books, menus, mail, and even medication labels.
Benefit # 6 Enhanced Security
Digitized documents are safer and more secure than physical copies. OCR technology permits the encryption of data and passwords on important files. It also allows redaction features to protect sensitive information. It effectively tracks changes to the document and records who has access to it.
Financial institutions utilize OCR technology to enhance the security of their transactions and client data. Sensitive documents like loan applications, identity verifications, and financial statements are processed using OCR.
Benefit # 7 Better Customer Service
OCR makes processing documents faster, which means businesses can respond to their customers quickly. This makes the customers happier and more likely to stick around. It also helps in real-time customer communication so queries are handled more efficiently.
A notable example of improved customer service via OCR technology can be found in the banking sector. Many banks have integrated OCR with their mobile apps to let customers deposit checks using smartphones. Users simply take a photo of their check, and OCR technology accurately reads and processes the check data, crediting their account without needing a physical bank visit.
Final Thoughts
OCR keeps getting better, especially with the integration of AI. It understands complex layouts and handwritten notes. Investing in OCR now means businesses are set up for even more advancements in the future.
The benefits of OCR are clear in companies; it helps with faster processing, better accessibility and security, and enhanced customer service. So why wait? Incorporate OCR technology into your business processes and reap the rewards.
Dawood is a digital marketing pro and AI/ML enthusiast. His blogs on Folio3 AI are a blend of marketing and tech brilliance. Dawood’s knack for making AI engaging for users sets his content apart, offering a unique and insightful take on the dynamic intersection of marketing and cutting-edge technology.
