As we step into the sixth decade of the information age, data has emerged as a valuable currency in the business world. However, a large portion of a company’s data is in an unstructured format, primarily consisting of written text found in diverse sources like reports, contracts, and emails. Intelligent document processing helps to automate the extraction, interpretation, classification and processing of unstructured data and it to respective systems for further processing.

The traditional approach of manually gathering and organizing this information consumes significant time and resources, leading to the underutilization or overburdening of a company’s most valuable asset—its human talent.

Intelligent document processing solutions like DocEdge are increasingly being embraced across various industries, including BFSI, healthcare, and IT. It enables automated document processing for document-centric tasks like invoice processing, contract management, and compliance reporting. This automation streamlines operations, reduces manual effort and harnesses the power of technology to maximize the potential of a company’s data.

What is Intelligent Document Processing(IDP)?

Intelligent Document Processing (IDP) is an advanced technology that combines artificial intelligence (AI) and machine learning (ML) techniques to automate the extraction and processing of data from unstructured documents. Unstructured documents refer to various types of content such as invoices, purchase orders, contracts, emails, and other business-related documents that do not have a predefined format.
Intelligent document processing tools use a combination of optical character recognition (OCR), natural language processing (NLP), and ML algorithms to analyze and understand the content of these documents. The goal is to automatically extract relevant information, classify documents, and route them to appropriate workflows or systems.

Intelligent Document Processing Market

Industries such as BFSI, healthcare, manufacturing have numerous documents on a daily basis. Take for example, the insurance industry known to be as the most paper-sensitive, ranging around 100 million drafts per year. As per the report the global intelligent document processing solutions market is expected to grow at a CAGR of 37. 5% from 2022-2030. The key driver behind the exponential growth are-

  1. Rising need for enterprises to process large volumes of structured data
  2. Growing demand of advanced technologies
  3. Market Competition

Intelligent Document Processing Market
Source- Markets & Markets

How Does Intelligent Document Processing Works?

Intelligent Document Processing (IDP) is the process of automating data extraction and processing by leveraging AI technologies like Machine learning, OCR, and NLP. IDP can read various text formats and even process barcodes, images or hand-written documents. It scans documents to convert paper-based documents into machine-readable file formats such as PDFs or Microsoft Word, with searchable text options so information is readily available.
This whole process of involves multiple steps that require constant focus and attention. Here’s a general overview of how Intelligent Document Processing Software works:

How Does Intelligent Document Processing Work?

  1. Document ingestion
    The intelligent document processing platform receives unstructured documents in various formats, such as PDFs, scanned images, or electronic files. These documents can include invoices, purchase orders, contracts, forms, or any other type of document containing textual information. By using OCR intelligent document processing tools scan image-based documents into machine-readable text. OCR technology identifies and extracts the characters and words from the document images, enabling the system to work with the textual content.
  2. Document Classification
    The system classifies the documents based on their type or purpose. For example, it can differentiate between invoices, receipts, or contracts. This step helps determine the relevant data extraction rules and processing workflows for each document type.
  3. Data Extraction
    Using a combination of rule-based approaches and machine learning algorithms, the intelligent data extraction identifies and extracts relevant data fields from the document. The extraction can involve locating and capturing specific information such as customer names, addresses, invoice numbers, due dates, and line items. Machine learning techniques can be employed to improve extraction accuracy over time.
  4. Data Validation and Verification
    The extracted data is validated against predefined rules and cross-checked with external databases or systems for accuracy and completeness. For example, the system may verify the extracted invoice amount by comparing it to the corresponding purchase order or receipt.
  5. Data Integration and Storage
    The extracted and validated data is then transformed into a structured format and integrated into existing business systems or databases. This allows for further processing, analysis, or archival purposes. The data can be stored in a structured format such as a database or transmitted to downstream applications through APIs or other integration methods.
  6. Exception Handling and Human Review
    In cases where the IDP system encounters ambiguous or low-confidence extractions, it can flag them as exceptions. These exceptions are typically routed to human reviewers or subject matter experts who validate and correct the extracted data manually. This feedback loop helps improve the system’s accuracy and learn from its mistakes.
  7. Continuous Learning and Improvement
    The IDP system employs machine learning techniques to continuously improve its performance over time. The system can learn from the feedback provided by human reviewers, track extraction accuracy, and adapt its algorithms to handle new document types or variations in document formats.

Benefits of Intelligent Document Processing Solutions

Intelligent Document Processing (IDP) offers several benefits for organizations that deal with large volumes of unstructured documents. To process this information, data security and privacy are also major factors to be discussed. DocEdge, one of the leading intelligent document processing solutions provide data security and makes it secure for further processing. Here are some of the key advantages:

  1. Automation and Efficiency
    IDP automates the extraction and processing of data from documents, reducing the need for manual data entry and manual processing. This document processing automation leads to increased efficiency and productivity as it eliminates repetitive and time-consuming tasks. Employees can focus on more value-added activities, leading to overall process optimization.
  2. Cost Savings
    By automating document processing tasks, IDP can significantly reduce operational costs. It eliminates the need for manual labor and associated expenses, such as hiring and training data entry operators. Moreover, the reduced processing time results in faster turnaround times and improved cash flow.
  3. Improved Accuracy
    IDP leverages OCR, NLP, and ML technologies to accurately extract data from documents. This reduces the chances of human errors that may occur during manual data entry. The system can also perform data validation and verification, cross-referencing extracted information with external databases or systems, further enhancing accuracy.
  4. Scalability
    IDP systems can handle large volumes of documents efficiently. They can process thousands of documents in a relatively short time, making them highly scalable for organizations dealing with high document volumes. The system can easily handle peak periods or fluctuations in workload without compromising accuracy or speed.
  5. Enhanced Compliance and Governance
    IDP helps ensure compliance with regulations and internal governance policies. It can validate and verify data against predefined rules, ensuring that the extracted information meets the required standards. This reduces the risk of non-compliance and potential penalties associated with errors or inconsistencies in data.
  6. Improved Data Insights and Analysis
    By extracting data from unstructured documents and transforming it into structured formats, IDP enables organizations to gain valuable insights from the processed information. The structured data can be integrated into analytics tools or business intelligence systems for further analysis, reporting, and decision-making.
  7. Faster Processing and Turnaround Times
    IDP significantly reduces the time required for document processing. The automation of data extraction and validation enables faster turnaround times, accelerating business processes and improving customer service. Organizations can respond to customer queries, process invoices, or handle other document-related tasks more quickly and efficiently.

Types of Documents that Can Be Automated

Intelligent Document Processing solutions are designed to automate the processing of various types of documents and data. These solutions use a combination of technologies like Optical Character Recognition (OCR), Natural Language Processing (NLP), and machine learning to extract, understand, and process data from documents. The types of data that can be processed by IDP solutions include, but are not limited to: 

Invoice Purchase Orders
Receipts Legal Documents
Healthcare Records Financial Statements
Emails Handwritten Documents
Images and Scanned Documents Bank Statements
Customer Correspondence KYC Documents

Intelligent Document Processing Use Cases

Intelligent Document Processing (IDP) can be applied to various use cases across industries where there is a need to process and extract information from unstructured documents. Here are some common use cases for IDP: 

Intelligent Document Processing Use Cases

  1. Invoice Processing

    Intelligent document processing tools can automate the extraction of relevant data from invoices, such as vendor information, invoice numbers, line items, and amounts. It can validate the extracted data against purchase orders or contracts, enabling efficient accounts payable processes.

  2. Customer Onboarding

    Intelligent document processing solutions automate the extraction of customer information from documents like application forms, identification documents, and financial statements. This speeds up the onboarding process, reduces manual errors, and improves customer experience.

  3. Loan Application Processing

    Intelligent document processing platform can extract data from loan applications, including applicant details, financial statements, and supporting documents. This enables faster and more accurate loan application review and decision-making.

  4. Claims Processing

    IDP can automate the extraction of data from insurance claims forms, medical records, and supporting documents. This accelerates the claims processing cycle and improves accuracy in determining coverage and payouts.

  5. Human Resources (HR) Processes

    Intelligent document processing solutions can automate HR processes by extracting data from resumes, employee onboarding forms, performance evaluations, and other HR documents. This streamlines HR workflows, improves data accuracy, and enhances employee experience.

  6. Healthcare Records Processing

    IDP can also extract relevant information from medical records, lab reports, and patient forms. This assists in accurate medical coding, billing, and streamlines healthcare record management.

How to Choose the Right Intelligent Document Processing Solution for Business?

When selecting an intelligent document processing (IDP) solution, it’s crucial to consider various factors to ensure it aligns with your organization’s specific needs. Here’s a rephrased version of the paragraph:
Choosing the right IDP solution requires careful consideration of several factors.

  1. Begin by identifying your organization’s data processing requirements, such as the format of received or stored data (email, scanned documents, physical paper, etc.), whether the data is structured or unstructured, and the volume and frequency of data that needs to be automated.
  2. Once you understand your data processing needs, assess which datasets would benefit most from IDP. Focus on documents that require significant manual processing time, as they are ideal candidates for automation.
  3. Next, compare different IDP software options. Here are a few factors to keep in mind while choosing and comparing IDP solutions
    • Consider factors such as the expected accuracy level compared to manual error rates and the potential for improvement.
    • Determine if the IDP technology is template-based or capable of handling complex data formats that lack a prescribed structure.
    • Verify if the software can effectively read and understand the types of data and documents your organization deals with.
    • Assess the ease of integration with your preferred business tools and whether customization is possible.
    • Evaluate the scalability of the software to handle your expected data volume and future growth.
    • Consider the implementation timeline and the level of support provided by the vendor. Lastly, compare quotes from different providers to gain insights into pricing.

Why Choose AutomationEdge DocEdge?

AutomationEdge’s DocEdge is one of the leading intelligent document processing solutions that comes with AI technologies like machine learning, OCR, and NLP that can automate data extraction across enterprises. By automating multiple data process, businesses can enable employees to get rid of repetitive work and take care of decision making work more. With AutomationEdge’s DocEdge you get-

Choice of
OCR venders

Robust architecture for upscaling and downscaling

Native support for major use cases

OS
agnostic

Built-in image correction To deal with image flaws

Feature-rich web console with RBAC

Easily switch between document formats

Java-based
tool

Seamless integration and automation

Native support for Maker-Checker processes

Frequently Asked Questions (FAQs)

  • Why is intelligent document processing important?
    Intelligent document processing is important to manage data better for multiple business processes and reduce the manual efforts involved in intelligent data extraction and processing.
  • What technology is used for intelligent document processing?
    Intelligent document process solution use multiple AI technologies like OCR, NLP, and machine learning in combination with automation to automate data extraction and processing workflow.
  • What is the difference between intelligent document processing and automated document processing?
    Automated Document Processing focuses primarily on automating manual processes, reducing reliance on manual data entry, and improving efficiency. On the other hand, Intelligent Document Processing (IDP) goes beyond basic automation and incorporates advanced technologies such as Natural Language Processing (NLP) and Machine Learning (ML) algorithms to understand and interpret the content of documents, extract relevant information accurately, and perform complex data validation,
  • What is the Difference Between IDP and OCR?
    OCR focuses on extracting the textual content from documents, such as printed text, numbers, or handwriting, and does not involve advanced analysis or understanding of the document’s content beyond the text itself.
    On the other hand, IDP is a broader concept that encompasses OCR as one of its components. IDP leverages OCR technology but goes beyond simple text extraction to intelligent data extraction.
  • How Does IDP work with RPA?
    Intelligent Document Processing (IDP) and Robotic Process Automation (RPA) are complementary technologies that can work together to automate end-to-end business processes involving document handling and data processing.