By James Adie, Vice President of EMEA at Ephesoft
How companies can benefit from revealing hidden information
Data is undeniably the key to making good business decisions. It is also essential for offering a personalised service to customers and partners. Ironically, however, there is still a great deal of information that exists in an unstructured format in documents or images, rather than in an easily accessible database. This makes sharing and analysis difficult, and sometimes impossible.
In the dark about suppliers and customers
When a company processes incoming invoices, payment information is generally entered manually by someone physically reading the document. After payment, the process is deemed to be complete, and the document is archived. All the information on that invoice that was not required for payment approval, such as payment terms, discounts etc., remains “dark data” – it’s still in a file somewhere but nobody has recorded that it’s there, so it is practically invisible.
It’s the same with customer information. Paper-heavy sectors which process a high volume of incoming documents from customers could benefit enormously from capturing dark data. Documents such as insurance forms, financial statements and medical records all contain a wealth of information about customer needs and behaviour. If these are not recorded in a digital format, then the information is effectively lost to the company. By harvesting and analysing this data, an organisation can understand its customers better and provide them with a more personalised service by predicting their future needs as well as having the ability to respond faster to questions or requests.
If we can just find a way to access this data, we can put a wealth of valuable information to work and improve productivity at the same time.
Dark data capture in practice
We worked with a large US flooring distributor which deals with an enormous volume of orders, invoices and packing slips on a daily basis across twelve branches. The accounting department receives around 2,000 to 2,500 invoices per day. In its freight processing department, around 500 packing slips are created every day.
The company had five people in its accounting team and one additional employee in the post room to manually process all of these documents. In the accounting department, two employees scanned all documents and physically printed out any PDFs and email invoices which went through the necessary review process before being filed. Thousands of invoices had to be manually indexed, which took up the entirety of the working day. As the team was working at capacity, it struggled to meet deadlines and was therefore unable to take advantage of supplier discounts for early or prompt payments. Errors also occurred frequently during manual data transfer. It was time to look for a more efficient, user-friendly alternative.
In this case, the automatic indexing of invoices using intelligent document processing (IDP) technology reduced the time for processing incoming documents from 40 hours per week to between eight and ten. This technology uses Artificial Intelligence (AI) in order to evaluate all documents from various input channels, extract the essential information and automatically classify it for further processing – no matter the format or layout. Even handwritten information can be reliably captured, further taking the pressure away from employees who only have to manually check documents if they cannot be reliably processed by the system due to stains, smeared writing or any other issue that allows for ambiguity.
By introducing automatic document capture, the flooring distributor significantly reduced the error rate. Around 85% of invoices now run directly through the system without the need for validation, saving a lot of time and effort. One of the two employees who used to scan invoices has now been able to take on a non-accounting role in the company, instantly reducing direct personnel costs in the department. Furthermore, invoice processing time was reduced by 65%. The benefits of automating the process were also felt in the mail room; employees who used to spend around 30 hours a week scanning documents and invoices now only spend around five hours on the same task.
In addition to significant time savings and increase in employee productivity, another return on investment was realised in less than six months as the company was able to start taking advantage of supplier rebates and discounts almost immediately. After the pressure was taken off the team, they were able to act on the fact that some suppliers offer a 30% discount if an invoice is paid within ten days. As a speedy turnaround was no longer a problem, the suppliers soon noticed that the flooring distributor was routinely paying earlier and offered even better terms.
Beware of dark data
Dark data can be found in almost every company and “bringing it to light” is always economically and strategically worthwhile. Not only is there a vast amount of unused data in paper-based business or administrative processes, but this problem also arises with digital documents if not all of the content is extracted and saved in a searchable format. There is significant potential for optimisation in many companies – maybe it’s time to take a closer look to find out if your own company is still in the dark?
