The idea of the paperless office has been around for decades yet few companies have been able to achieve anything close to this idea. With all the technological advances we’ve had, why is it still so hard for companies to move away from their people and paper based processes? It may come as little surprise that organizations are still awash in paper. However, for companies looking to gain insights and extract value from their data, they need to get that data into a state where computers are able to process it. To do that, companies need to digitize and digitalize their information and processes.
Mortgage Industry Digitization
According to a Mortgage Bankers Association report, as of 2016, the net cost to originate a residential mortgage has risen to $7,120 which is a 4x increase from just a decade ago. This increase is due to the heavy human processes still required, and the double and triple manual checks in place. Moving away from these manual processes speeds up processing times, reduces costs, and creates more predictable experiences.
The mortgage industry has mostly moved to electronic documents, digitizing paper forms of all types needed during the origination and closing process and adopting digital signatures as part of its move to digitize their processes. Digitization allows lenders to further automate compliance processes and remove manual processes, automating loan review, and reducing error rates with fewer resources. This digitization is transforming the mortgage industry by improving regulatory compliance, enhancing customer experience, increasing asset quality, reducing risk, and improving efficiency and cost containment.
Digitized mortgage processes have enabled a variety of automated processes including underwriting, mortgage processing, closing, and quality control. This allows organizations to not just store copies of borrower documents, but actually use the information in the documents to get data from third party systems, speeding up the processes and enhancing information for decision making. Additionally, digitization has enabled electronic closings, also known as e-Closings, where you are able to close a mortgage loan electronically.
Digitizing the invoice process
For many companies in just about every single industry, the invoicing process is still surprisingly very manual and paper based. Depending on the size of the company, they may have hundreds or thousands of suppliers that they work with. Each supplier has a slightly different look and layout to their invoice. By digitizing these documents, computers are now able to do some of the heavy lifting that was previously left to employees. Computers are able to automatically identify various key fields such as company name, payment amount, due date, and additional critical information as well as automatically storing a digital copy of the invoice. This makes searching for and finding invoices many months or years down the road much easier.
Companies that are implementing advanced invoice processing solutions use digitization approaches to capture invoices on the front end and automatically enter the data in payment or ERP systems for later payment. Advanced systems can even automatically verify that invoices are received from approved suppliers and invoices match purchase orders and PO line items. These verifications can save significant amounts of time, speed up invoice processing and reduce invoice processing costs.
How the Insurance Industry is Digitizing
An industry long known for producing lots of paper, insurers are no stranger to painful human and paper based processes. Inbound documents including application submissions, requests for information, customer service request letters, and many other types of business documents in the form of letters, envelopes, forms, faxes, and checks in paper-format can add up quickly. In fact, one of the largest US insurers has over three million boxes of archived paper documents.
Many advanced insurers have digitized documents in their underwriting processes. Underwriting correspondence, insurance quotes, policies, proposals, and billing and statements have been widely digitized by the industry over the past decade. Insurers generally digitally capture documents very early in the front end of business processes when documents are first received by the business, rather than digitizing them after they have been handled by humans meaning most insurance workers only interact with digital format documents. Digital capture systems capture the document and group it with related documents automatically, while also automatically extracting key information, automatically categorizing documents, and indexing them for later retrieval. Leading insurers are moving to the next level by applying analytics to customer interactions that give them the ability to further personalize and improve the customer experience.
The industry has also widely adopted electronic signatures, bypassing the need for direct paper interaction with clients. Agents and brokers are also being employed to ingest documents into insurance systems in a digital-first format via information portals. Indeed, almost every area of interaction within insurance is impacted by digitization, from interactions with customers to underwriting and claims management. This helps to speed up processing, reduce time and cost in handling claims, reducing fraud and risk, and improving customer satisfaction.
How AI is impacting Digitization
Digitization is necessary for achieving higher-level AI requirements. Without good, clean data, machine learning systems are not able to produce outcomes of value. For organizations that want to start applying AI and ML their data needs to be in a usable state. While digitization efforts are not new, there are state of the art and best practices that should be researched and adopted to do this in a thoughtful way. Once the digitization “stepping stone” layer is applied, AI and cognitive technologies can then be added on to extract useful value and gain intelligence and learning from various forms of content and content intelligence and cognitive automation can be applied.