OCR is what? Application technology OCR character recognition optical out of goods

In the context of the business increasingly interested in conversion of the digitized documents not only is “turning paper into image file” which is still in the process of turning the information in material data can be processed automatically. To do that, OCR technology is core tool.

This technology helps to save time entering data manually, open the ability to connect internal data, high performance operation and increase accuracy in information management. The same Lac Viet Computing find out details about OCR in this article.

1. OCR is what?

OCR abbreviation for Optical Character Recognition or character recognition optical is technology which allows to extract text from image, scan documents, PDF file, or even photos from your phone to move the text can edit, search and integrated into the system number.

In other words, OCR helps the computer “read the word” in the document that the human eye can see, but can't understand if only in the form of images.

Distinguish between OCR and scan conventional

One of the common misconceptions is thought that scan the document means digitized. The actual scan only create the image number of the document you still can not manipulate the content inside. Meanwhile, OCR helps you turn static data into information that can used right, can search, extract, repair, or entered into the system such as accounting software, CRM, ERP.

For example, suppose you are storing 500 bills of the customer in the form of image files. If you need to re-enter data such as name, company name, amount, date released... to collate or make a report, you will lose the daily work if entered manually. But if use the software with integrated OCR system can automatically extract the information you need, sorted by table data put into the accounting system in just a few minutes.

2. The manner of operation of OCR technology: From photos to digital data can use

Technology OCR character recognition optical computer help understand text in images. More specifically, when you scan a paper document (such as invoices, contracts or survey), OCR system will transform content from a “photograph” of writing numbers that the computer can handle, search, or stored in the system.

This process usually takes place in 4 main steps as follows:

Step 1. Image preprocessing (Image Preprocessing)

Each input image will be different about quality: can be blurred, tilt, much noise, or have the light unevenly. Therefore, the first step is image processing to clarify the standardized input to ensure the OCR character recognition the most accurate.

The commonly used techniques include:

• Balance, brightness, increased contrast between background and text
• Remove background noise (stains, ink dots, shadow)
• Align the corner of the scan if the picture is tilted
• Cut margin, remove region contains no text

Step 2. Character recognition (Character Recognition)

This step is the focus of the entire OCR process. The system will be “scanned” line by line, each text area in the picture to identify each character, including:

• Letters (A-Z, a-z)
• Digits (0-9)
• Punctuation marks, special symbols
• Icons (if supported)

Depending on the type of OCR recognition process can be used:

• Pattern (template matching): comparison shapes each character with the library available
• Machine learning models (machine learning): The system “learn” from examples to recognize characteristics of the letter, even when deformed mild
• Character recognition handwritten (ICR – Intelligent Character Recognition): Handle handwriting with higher accuracy

Step 3. Language processing and formatting (Post-recognition Structuring)

After the identification is done each character, the system should merge them into words, lines, paragraphs are complete structure like a text real. This step is very important to ensure the information can understand put into the system the correct format.

What's happening in this step:

• Analysis words – sentences – paragraphs (based on distance, punctuation...)
• Fix common errors due to false identification (for example, “I” into “1”, “rn” to “m”)
• Determine the logical structure such as tables, columns, categories
• Label content: date, amount, company name...

Step 4. Production data integration system

Finally, the entire text has been digitized will be converted files can use or put directly into the software internally as:

• File Word, Excel, PDF can search
• System, document management (DMS)
• Accounting software, ERP, CRM...

In addition, the system also can save the metadata (meta data) as time scan, scan type, document... to serve the purpose of access check later.

3. OCR application in business today

Here are 4 outstanding application of OCR are many businesses implement effective:

3.1. Digitize contracts, receipts, documents, accounting

This is the most popular application of OCR, particularly in the departments of finance, accounting or legal. After receiving the contract, invoice or receipt and expenditure instead of entering information into the system, OCR can scan documents quick extract important fields such as customer name, contract number, amount, release date, tax code...

For example, Instead of accounting staff takes 5 minutes to type the data from a paper invoice, the system integrates OCR only need a few seconds to recognize the entire information push up accounting software with higher accuracy to reduce errors.

Benefits for business: save time entering data manually, reducing the risk of errors, speed up transaction processing. At the same time, data is also standardized for reference when need.

3.2. Automatically import data into the management software (ERP, CRM)

OCR't stop at just reading the material, but also play the role as a “bridge” between the physical document and the system admin of that business are using. When integrated with the software such as ERP (enterprise administrator) or CRM (customer relationship management), which OCR allows automatic data entry without the need to manipulate time.

For example, A stock purchase requirement is scan processed through OCR, then automatically updated in the ERP system as buy orders, internal, ready-to-browser deployment.

Benefits for business: Increase alignment between departments, limiting the “wrong input data” reduce the operation repeated to ensure consistency of information throughout the system.

3.3. Search extract information from the document repository scan

A lot of businesses have scan the entire contract, records, personnel records... of the image file or PDF. However, if there is no OCR, the document is almost impossible to search for content inside unless you open each file to read manually.

OCR help solve this problem by turning the image files or PDF static documents can be searched by content, keyword, or specific information.

For example, You need to find all the contract in 2023 have the terms “violation penalty of 10% of the contract value”. Instead of reading each file, you just type keyword into the system and OCR will scan the entire data to filter out the right contract contains that information.

Benefits for business: save you hours of searching speed feedback requirements or internal inspection and audit, at the same time reducing dependence on memory or “experience store” of each employee.

3.4. Archive access information in the system document number

When documents are digitized with OCR, business can be stored on the system, document management (DMS – Document Management System) according to the logical structure to access: according to the client name, time, document type, creator code, project...

OCR role as tool “label smart” for each document, thus helping classification system, filter search by many criteria.

Benefits for business: Create a working environment that not papers, professional, modern. Hr can work remotely which still access handle material quickly, transparency can control.

According to the report by ResearchAndMarkets (2024) market OCR global is expected to reach 26 billion by 2030, with growth average of 13.7% per year. This number reflects not only the potential of technology, but also shows how popular and essential of OCR in the operation of culture of the modern enterprise.

4. Benefits that OCR technology brings to the business

The OCR application is not only a step improvement in terms of technology, which is the transition markedly in the way businesses handle information management. If ago, a paper document and the work input crafts often time-consuming to erroneous date, OCR has opened a saving effect more accurate. Here are 5 practical benefits that this technology brings:

4.1. Save time cost input crafts

One of the most expensive in the governance document is re-enter information from paper records into the system. With OCR, this stage is almost eliminated. The system can automatically extract data from invoices, contracts, personnel records, survey... enter directly into the internal software in just a few seconds.

Practical example: Instead of having 3 staff accountants work continuously for 2 days to enter 1000 bills, OCR can handle in less than 1 hour with unsurpassed accuracy and much lower cost.

Specific benefits:

• To reduce personnel costs administrative
• Increased processing speed work
• Shorten the time to give us feedback when needed

4.2. Increase accuracy, reduce errors enter the wrong information

Human, though be careful to now are still at risk of entering the wrong data, especially when have to handle large number of papers repetitive. OCR help reduce this risk significantly thanks to process extracted data processing based on the algorithm and logic language, instead of feeling personal.

For example: A character “0” is easily mistyped the “O” in the client code. OCR can detect this by checking the context data structure input.

Specific benefits:

• To ensure the accuracy of information input
• Limiting system errors entailed in the process of further processing (accounting, reporting, storage)
• Enhanced reliability internally and when working with partners

4.3. Optimize storage access quick information

OCR not only “read” the text, which also helps to attach information to each document, from which easy sorting, searching, data mining when needed. Businesses no longer have to “record takes” hundreds of PDF files or sit probe each scan to find information.

For example, You need to find the contract with A counterparty in the quarter 2/2022 have the terms “compensation contract”. If the material has been processed by OCR, just a few seconds to find the right text required.

Specific benefits:

• Speed feedback internal and customer
• Reduction depends on the experience of storage of personal
• Reduce the time cost of managing paper documents

4.4. Create the foundation for the process automation (RPA)

OCR is the first step to put the data into the system. When data is digitized, automatic processing, complete business can continue to connect with RPA process automation using robot software to perform repetitive tasks such as creating reports, collate orders, sending email notifications, updates customer records...

For example: OCR extract the contents of the invoice → send in software RPA → system create proof of payment sent to the browser spending absolutely no need operation manually.

Specific benefits:

• Increase productivity without increasing staff
• Automate processes to repeat, consuming
• Freeing up resources to focus on the task to be more strategic

4.5. Support regulatory compliance archive data security

Many areas such as finance, medical, insurance or public administration requires businesses to store documents, a standard, easy to access, has the ability to recover when the need to check and compare. OCR help create a profile document digitization structured, easy to find at the same time associated with system access rights, encryption and backup.

For example: the document is processed by OCR will be able to store on the system, DMS (Document Management System) with decentralized mode: only the accounting personnel are viewing the bill, hr, legal contract...

Specific benefits:

• Reduce the risk of losing important data
• Easy to deal with inspection and audit
• Increase the level of professional security in document storage

With the business are in the process of optimizing the operation of chemical data, OCR not only is tech support that is an integral part of the ecosystem conversion number. From cost savings, increased processing speed to create a platform for automation, OCR is helping business progress faster, more accurate, more sustainable in the digital era.

You are in need of optimal process documents in business? Let's start by simple steps: Find out service experience, OCR, sign up to receive advice deployment of digital documents with OCR from Vietnam today.

5. Process to apply OCR technology to digitize documents in business

To successfully apply the OCR in the document digitization, businesses need to follow a fair process to ensure efficiency and accuracy in the conversion of documents from physical form to digital form.

Process to apply OCR technology to digitize documents in business:

• Step 1: Determine the type of documentation required number of turns
• Step 2: select the OCR software suitable
• Step 3: set process digitization
• Step 4: integrate OCR into document management system (EDMS)

Step 1: Determine the type of documentation required number of turns

Before implementing OCR, businesses need to clearly define the types of documents will be digitized. The common materials usually including: invoices, personnel records, contracts, meeting minutes, technical documents or other financial documents. Determining the right type of material to help businesses focus resources and choose the most suitable solution for his needs.

Step 2: select the OCR software suitable

Depending on demand, scale your business, choosing OCR software plays an important role in the effective number of turns. Businesses need to consider factors such as the ability to recognize many languages, supports document formats complexity, accuracy, processing speed and features integrated with the other management system.

Step 3: set process digitization

After selecting the software, enterprises need to establish a clear process for digitizing documents. This process includes steps such as scanning the original document processing, OCR to recognize the text, and then store the data in digital form. Each step should be to establish a detailed, standardized to ensure consistency and efficiency in the entire process.

Step 4: integrate OCR into document management system (EDMS)

To optimize the process of digitization, businesses should integrate OCR with management system electronic document (EDMS). This combination helps to manage and store documents after the number of chemical science, organized, allowing for search, access and share information quickly. EDMS not only help management focus that also increase security for business data.

The integrated OCR with EDMS help businesses save time, reduce cost of document management. Thanks to the ability to automatically identify, document processing, businesses can quickly complete the work that previously it took many hours. At the same time, the digitization also helps to reduce cost of paper, printing, physical storage.

Lac Viet solutions provider digitized comprehensive with LV-DX Documen, LV Sure DMS integrates OCR technology, management system, smart materials. Business can easily scan, text recognition, document storage according to standard processes, helping to optimize the time-saving resources.

6. Advantages and disadvantages of OCR is what?

OCR technology brings many important benefits, especially in the digitization of documents and automate the process of data entry. However, like any technology other OCR also have their own drawbacks. So, advantages and disadvantages of OCR is what?

6.1 Advantages

• Automate the process of data entry: OCR help batch convert paper documents into digital text quickly, saving time than the data entry manually. Thanks to that, businesses can optimize productivity and reduce the workload repeated.
• Minimize errors: The data entry craft easy to cause errors due to human factors, but with OCR, the document is handled automatically, which helps to significantly minimize these errors. Recognition results as accurate as materials are high quality.
• Enhanced search capabilities and data management: After the documents are digitized with OCR, the information can easily be searched by keywords instead of having to search through each page paper documents.
• Save costs and storage space: The conversion of paper documents to digital format helps enterprises reduce the cost of printing, storing, and help save office space when there is no longer need to store many papers physics.

6.2 Disadvantages

• The accuracy depends on the quality of the original document: although OCR works effectively with clear documentation, but if the original document is blurred, smudged, or damaged, the accuracy of recognition results will be diminished. Documents with complex formatting or handwriting may also cause difficulties for the process of recognition.
• Cost of initial deployment: To deploy OCR effective, businesses need to invest in software and hardware (such as scanner, high quality).
• Ability to handle complex text limitations: With the document contains many charts, graphs or complex structure, OCR may have difficulty in the analysis, accurate identification.

OCR technology not only bring many benefits of digitizing the data but also opens a new era for information management in the enterprise. Hope through this article, businesses have understood OCR is what, as well as more information about how to apply OCR technology to digitize documents.