The Benefits Of Optical Character Recognition (OCR) and How It Can Improve Business Workflow

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What is Optical Character Recognition? As you might have guessed from the name, OCR is a technology that uses character recognition to scan and process images. The progress of OCR has been, to say the least, significant. The technology has advanced to the point that automated scanners are commonplace in many businesses worldwide. Today, we will explore some of the history, benefits & use cases surrounding this technology and look at ways your business could utilize it in the future.


From noble beginnings

Optical Character Recognition hasn’t always been tied to accelerating workflows or reducing business costs- it started as a tool to help the visually impaired. In 1917, the Optophone was invented, which scans printed text and generates audible tones to identify letters. These tones could read the text at a rate of one word per minute. This process would eventually be the basis for the first proper OCR technology invented by Ray Kurzweil in 1974, the CCD flatbed scanner. His invention was the first omni-font optical character recognition system, meaning it could recognize text printed in virtually any font, incorporated with full text-to-speech. In the mid-90s, OCR technology was a common feature in multifunction printers, with Xerox ScanSoft being the first adopter. Since then, OCR technology has been implemented in smartphones, used to bust spam & enhance machine learning.


How does optical character recognition work?

Optical character recognition (OCR) turns the physical form of a document into digital text. A scanner processes the original document, and OCR software converts the document into a two-color or black-and-white version, a bitmap. The bitmap undergoes a series of steps: First, it analyzes for light and dark areas, signaling dark areas as characters that need to be recognized. Then, the dark areas are processed to find alphabetic letters or numeric digits. OCR typically targets one character, word, or text block at a time. One of two algorithms—pattern recognition or feature recognition—is then used to identify characters. Pattern recognition is used when the program is fed examples of text in various fonts and formats to compare and recognize characters in the scanned document or image file. Feature detection is the application of rules regarding the features of a specific letter or number to identify characters in scanned documents. Finally, the program displays the recognized text after processing all likely matches.


The benefits of OCR


Optical character recognition technology allow businesses to eliminate the step of manually entering text into documents, creating effortless text searches, editing, and storage. Implying OCR into your business workflow can help with the following:


  • Reducing document redundancy & entry errors

  • Freeing up your staff for higher-value tasks

  • Implement indexing & data enhancements

  • Centralizing data for greater control over it

  • Keeping your business-critical information up-to-date

The use cases for OCR


The most common use of optical character recognition in your business would be to convert scanned documentation into a machine-readable text file. Still, OCR is being leveraged in more use cases than just helping with your A/R department. Here are a few use cases that may not be so straightforward:


  1. OCR for Mobile Data Capturing
    Levering OCR to capture tax documents, business card contacts, and presentations with your smartphone is a widely adopted use case for transcribing business information on the go. Numerous applications give you this: Abbyy FineReader PDF, Microsoft Lens & PaperScan.

  2. OCR for Tire Inspection
    Discount Tire eliminated paper-based processes throughout its 11,000 retail locations. Instead, they leveraged OCR in an unorthodox way- a mobile tire inspection solution their staff used to capture & assess tire type, tread depth & serial numbers- all in under 5 seconds. As a result, the tire retailer gave their customers the benefit of reduced wait times and a more positive service experience.

  3. OCR for Automated Vehicle Documentation
    Another out-of-the-box example is Baywatch Technologies, a Utah-based startup. The company combines HD camera monitoring systems with OCR license plate reading technology to provide customers with an automated way to document the condition of vehicles before they provide service to the cars, reducing customer disputes based on vehicle damage

How to leverage OCR with SmartTech

Providing smart paper & document management solutions is a good purpose we fulfill for each client. Implementing OCR technology into your business workflow is a great way to make scaling your document management process more manageable. We have a few ways we help implement OCR technology:


OCR-enabled copiers & printers
Matching your office printing needs with embedded high-end OCR software equipment is one way we help our clients. While most, if not all modern multifunction printers have OCR capabilities, we can help walk you through which devices meet your workflow demand.


Printer management solutions with OCR technology
As businesses grow, their printing needs tend to grow as well. Therefore, implementing a system to manage your printing assets could be a worthwhile investment, especially if you want to leverage API-driven OCR technology, such as Tesseract or ABBY.


Enterprise document management systems
Workflow Automation can help reduce operational friction and cost in your business. In addition, document management systems can aid in increasing efficiency throughout any organization. These solutions will combine OCR technology with artificial intelligence (AI) to capture, index, and route your business data to maximize your business process.


Closing thoughts


Recent advancements in optical character recognition (OCR) technology have made it a new and highly effective tool for businesses looking to efficiently and accurately process large amounts of unstructured data. With increases in accuracy and decreases in price, OCR is proving to be an invaluable tool for businesses of all shapes and sizes, particularly when considering its many advantages over other methods.


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