Market-leading IDP solutions use AI document processing and sophisticated workflows to convert piecemeal information into structured, actionable business data. Here’s the six-step process that DocuWare’s document management software follows to turn disparate information into digital workflows:
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Step 1: It captures documents from several places.
IDP software gathers documents from multiple sources, including scanned paper documents, email attachments, PDFs, invoices, contracts and digital forms. The technology recognises and prepares information for processing, regardless of entry method. It’s compatible with multifunction printers, mobile scanners and online portals.
Step 2: It improves document quality for accurate processing
The system applies image enhancement techniques to scanned or low-quality documents, sharpening blurry text, correcting skewed alignments and removing visual noise. These improvements significantly enhance OCR accuracy by improving document clarity.
Step 3: It uses AI to extract and convert key information
Next, the IDP solution extracts both structured and unstructured data using OCR, NLP and machine learning techniques. OCR converts printed or handwritten text into digital format using HTR, while NLP understands the meaning of words and phrases. This combination of technologies enables the IDP system to recognise invoice numbers, payment amounts, contract clauses and employee or customer names without requiring pre-set templates.
Step 4: It automatically categorises and sorts documents
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With key information extracted, IDP software uses intelligent data processing to classify documents into predefined categories such as invoices, purchase orders, HR forms and legal contracts. Machine learning improves document classification over time, automatically routing data to the right workflow or department, eliminating time previously spent on manual sorting.
Step 5: It validates data
IDP performs automatic validation checks on extracted data, comparing it with existing records in business systems or databases and flagging discrepancies such as mismatched invoice totals for review. This process prevents errors, reduces compliance risks and improves financial accuracy.
Step 6: It integrates data with business systems
The validated data then seamlessly integrates with business software such as Enterprise Resource Planning (ERP) software, Customer Relationship Management (CRM) systems and Document Management Systems (DMS), automating tasks like invoice approval, contract storage and employee record updates while eliminating the need for manual data entry.
IDP use case: Accountants in practice
One significant application of IDP is document automation for accountants in practice. IDP technology extracts data from invoices, receipts and tax forms, reducing manual entry and errors.
The system synchronises validated data into accounting systems for real-time financial management. It also flags discrepancies, ensures tax/VAT compliance, and streamlines audit preparation with secure document storage.
Accountancy firms using IDP have reported saving up to 40 hours per week on document processing tasks. As Coen van Dinther, Finance Controller at logistics service provider, ETC Holland, notes: “We wasted a lot of time on basic administrative tasks and couldn't focus that energy on more important tasks... [now] we are rapidly accelerating our business processes and increasing efficiency in all areas of the company.”
IDP use case: HR
In human resources departments, AI document processing automatically recognises and categorises CVs, cover letters and certifications based on configured logic, workflows and trained models. It can also extract key applicant data such as names, qualifications and work experience, transferring this information into applicant tracking systems.
Automatically extracting applicant data streamlines the recruitment process, reducing hiring timelines and allowing HR professionals to focus on candidate evaluation rather than paperwork. IDP technology also helps with employee onboarding, managing employment contracts and maintaining compliance with employment regulations.
German mobility service provider Stanglmeier Group used IDP software to create digital personnel files for 300 employees. It has also introduced workflows for resubmitting fixed-term employment contracts and ensuring important company notifications are securely emailed to all employees.
