Some business processes and transactions are easier to automate than others, so there are lots of areas where manual data processing and data entry still create bottlenecks of inaccuracy and tardiness. But some of these are disappearing with the help of intelligent data capture software, says Financial Systems News (FSN) writer, Lesley Meall.
‘Intelligent data capture offers the most capable technology for removing the manual workload from back office routines, freeing up personnel to better serve customers, collaborate with suppliers, manage capital and enable business growth while limiting overheads.’ It’s a bold assertion, and as it comes from Carl E. Mergele, the chief executive officer at Brainware, a software developer that specialises in intelligent data capture (IDC) and enterprise search solutions, you might want to take this statement with a proverbial pinch of salt. After all, we’ve been waiting a long time for the paperless office that IDC software is nudging us towards, it wouldn’t be the first time a developer of software may have overstated its capabilities, and Mergele’s assertion is impossible to verify – but it is not without foundation.
Not because IDC software can make the paperless office a reality (it can’t), but because it can help to create offices (and other work environments) with significantly less paper. With the help of smart software, an IDC system can takes scanners and optical character recognition technology, and lead them out of the dead-end they can so often lead into (by extending the range of imaging and various other systems). Because IDC accurately extracts data from unstructured electronic documents and paper documents (after scanning), validates this, and then feeds it into various other systems, it can make lots of document intensive business processes more efficient – from accounts payable (AP) and accounts receivable (AR) to managing expenses and preparing personal tax returns.
Marbank Construction, for example, has used the smart data capture tool Invoice, from ReadSoft, to remove some of the time-consuming and labour-intensive stages associated with processing the 2,000 or so supplier invoices it receives each month. ‘For a relatively modest outlay, the savings have been huge,’ says Steve Brown, the finance director. Until this process was automated, the AP team at Marbank had to affix barcodes to each invoice, and key data had to be extracted and input manually – an error prone process that required two dedicated staff members. Now IDC software automatically extracts the relevant data from invoices (received as hard copies or email attachments), and automatically feeds it into Marbank’s document management and AP systems.
This has enabled the construction firm to reduce its AP team by half, saving £60,000 a year (on salaries alone), and it got a return on its investment within the first year. ‘I don’t regard what we spent as capital expenditure. I look on it as relatively little money spend to do the job a lot better,’ says Brown. ‘When paperwork is processed manually there is a tendency to sort and deal with it in batches,’ he observes, which means that invoices can pile up, creating bottlenecks and slowing a variety of business processes down. ‘Now there is no last minute rush towards the month end,’ he says, and because all invoices are automatically captured on the day they are received, the FD benefits from having more accurate and up-to-date costing data available in full, at the touch of a button.
Old Dominion Freight Line (a less than truckload carrier in the United States), has used Distiller for Remittance, from Brainware, to improve its processing of customer payments and the associated services. Automating accounts receivable (AR) delivers many of the same economies and efficiencies as automating accounts payable. So the freight line has been able to remove many of the delays and errors associated with manual AR, and boost its productivity – by more than 400 per cent. ‘When you’re handling four or five times the volume that you did previously with a good process, it really makes a big difference to the company,’ says Ken Erdner, its vice president of information technology, because the efficiencies are allowing the freight line to grow without adding to its monthly overheads.
‘We are using the same number of staff members in AR today as a $1.5 billion company, as we did as a $200 million company,’ says Erdner, and the AR team is doing a better job, too. Intelligent data capture software means that Old Dominion Freight Line can grab 80 per cent of remittance and payment information (without human intervention) at the point of receipt. This has improved the visibility of cash flow and working capital, which has obvious benefits for the business, and it has been combined with faster and more accurate capture of the data in shipping documents, to improve the freight line’s services to customers too. Fewer shipments are flagged or delayed due to manual input errors or late payments, and shipments can be managed more efficiently at all stages in the order to delivery cycle.
How you access smart data capture technology depends on various factors, ranging from what you want to achieve, to your existing software and systems and how you chose to supplement them. Electronic document management systems are often extended by IDC software, from specialists including Abbye, Brainware, EMC Captiva, Celaton, Kofax, and ReadSoft, and business process management specialists such as Appian and DataCapture. Some specialists provide general-purpose IDC tools; others provide tools that can be used to address specific processes. So Celaton, for example, has a range of ‘point’ smart data capture solutions including: inStream for Correspondence, inStream for Claims, inStream for Recruitment, inStream for Procurement and inStream for Travel and Expenses.
Smart data capture is built into (or can be added to) some ERP systems, or the middleware tools that sit in the surrounding ecosystem. Oracle WebCenter Imaging and Oracle WebCenter Forms Recognition provide capture, intelligent extraction and process management capabilities that can be used to automate document driven processes involving various Oracle applications. Some software developers provide this sort of functionality by creating their own IDC tools and other built it into their system by integrating and ‘re-badging’ some of the specialist IDC tools out there. So image capture and intelligent data extraction capabilities are increasingly finding their way into all sorts of ‘point’ systems, and examples are as diverse as travel and expense management solutions and tax return preparation.
But when Simon Coles, a tax specialist and partner with the accountants and financial advisers PK Group first heard about smart software that could help the firm complete tax return forms, he wasn’t convinced. ‘I was a bit sceptical, and my initial expectation was that it wouldn’t actually do what it said it could do,’ he recalls, which was: scan various paper source documents (such as dividend statements and P11Ds) provided by clients, extract the relevant data, and then use it to auto-fill the boxes on electronic tax return forms. So seeing it in action was a pleasant surprise. The CCH Auto system knows what sort of data to expect, and when it recognises this, the relevant information is digitised and automatically transferred into the software Coles uses to prepare and process personal tax returns, which is CCH Personal Tax.
Coles has become a fan. ‘It almost makes preparing tax returns fun,’ he laughs. ‘It saves PK Group time and money and takes away the drudgery of keying in the information.’ Although CCH Auto could theoretically do the auto-fill without any human intervention, it provides users with an opportunity to double check the accuracy of the data. ‘You review the forms on screen and tick off each field in turn,’ explains Coles, ‘then you press a button and all of the figures are used to automatically populate the tax return form.’ Scanning the client source documents and storing them as PDFs has also reduced the amount of space needed to store paperwork. ‘We don’t have a paperless office but we do have an office with a lot less paper,’ he adds, and that’s a step in the right direction.