How does OCR work? And what is the future of OCR software?

You hear a lot about automatic document recognition, but how exactly does OCR work? The abbreviation “OCR” stands for Optical Character Recognition. The term represents a technique by which the computer reads letters, numbers and punctuation marks from a picture. Convenient because this way you transform documents into digital versions for editing and archiving. Sounds good. But how does OCR work to your advantage? And what’s next for OCR?

Past and present: how does OCR work in the basics and where does it add value?

During the OCR process, the software converts the “readable” data on an image into digital data. The result is an editable text. This used to be more than enough. OCR was quite complex then, because documents were mostly sent by mail. Reading out a triple-folded document with coffee stains was a strong piece of technical ingenuity. And OCR software got that done, for example, by digitally “cleaning” the document. But these days, most organizations receive documentation by mail in PDF format. Recognizing texts alone is therefore no longer such a complicated process. So what makes OCR software so innovative today?

Only an OCR system that can also interpret the data stands out these days. Regular OCR software does nothing more than convert image to text. A stroke of interpretation makes all the difference. But how does OCR work when it comes to interpreting a document? Exactly as it sounds: the software understands and processes the data on it. These may include an invoice number, a due date and an order number.

How does OCR software help process documents more easily?

The answer to that question has everything to do with the interpretation capability of the OCR software. The moment you present a document, the OCR system determines what kind of document it is dealing with. Based on that, it searches for specific fields or words. Here “quality” is a key word: poor OCR software does not interpret the data correctly, while good OCR software can distinguish things like invoice and due date just fine and outline the most likely scenario. The system then presents this to you, so all you have to do is check.

The future of invoice processing

Tooling that will also help you tomorrow.

Download whitepaper

Finding the best OCR software: what should you pay attention to?

When looking for the
best OCR software
for your organization, it is important to first determine the purpose for which you want to use an OCR solution. For example, the more document types you want recognized, the more intelligent the software needs to be.

Free OCR software is available, including through Google. If you offer a document for recognition here, you will have it back within 1 second. But don’t count on any interpretation of the data. You see a big mess of words in a row and will have to figure out for yourself what they all stand for. It costs nothing, but it also doesn’t benefit you much – especially when you have pages of text. If you really want to get something out of an OCR solution, it is important that you choose intelligent software.

But how does OCR that is smart work? The premise is that the recognition and interpretation process is automatic, so you no longer have to do boring, repetitive (input) work. This means, for example, that the recognition rate is already very high at the start, that you do not have to create templates by hand and that the software automatically makes a correction when the recognition is not 100% right away. Most parties do not offer this smart OCR software. But it is wise to choose this, because it is the only way to get the most out of OCR.

Next steps: how will OCR work in the future?

Traditionally, OCR software has focused primarily on processing purchase invoices. But with the digitization of documents, the flow of incoming documents is becoming increasingly diverse. And you need to be able to process that flow unambiguously in your financial accounting system.

In addition, there is increasing evidence of documents linked to invoices, such as packing slips or hr onboarding forms. Smart OCR techniques should be applied to these as well. After all, proper interpretation of the data ensures that it is correctly recorded in the underlying (ERP) system. That will save you a great deal of work.

The increasing importance of OCR software flexibility is due to the fact that documents are less and less structured. Whereas OCR could previously focus only on 1 particular document type with a fixed layout (such as a purchase invoice), it must now be able to recognize all kinds of formats and layouts. You need tremendously smart OCR software for that.

So how will OCR work in the future? Perhaps we are moving toward 1 large mailbox where all document types go to be recognized and processed by the OCR software. (When it comes to purchase invoices, by the way, WhiteVision already has a solution for this: the SMART Email Handler.) And there may soon be image recognition in addition to Optical Character Recognition. What if software could instantly name the faces in a photo via social media profiles? Or can calculate the glass area in the facade of an office building? How smart can OCR get then?

Want to know how our unique OCR solution works?

Get in touch!

Benefits

High rate of recognition
Learning from users
Work smarter

Want to know more about smart OCR software?

Whitevision biedt een zelflerende OCR-oplossing die alle opgedane kennis deelt binnen de gebruikerscommunity. Het gebruiksgemak is optimaal, de software corrigeert zichzelf automatisch en alle gebruikers profiteren van het steeds slimmer wordende systeem. Bovendien ontwikkelen wij onze oplossing continu door, zodat zij toekomstbestendig is én blijft.

Back to overview