How to automate document workflow: A complete guide for 2024
In today's information-driven world, collaboration and communication within teams heavily rely on data and documents. From contracts and invoices to manuals and reports, documents play a vital role in conveying structured information that can be easily shared, understood, and acted upon. However, to harness the full potential of documents, effective management is crucial. This is where document approval workflows come into play.
Document approval workflows are a series of steps that involve human input, all aimed at ensuring that a document meets internal standards before it can be used. These workflows serve as a quality assurance mechanism, guaranteeing that documents fulfill their intended purpose within the organizational framework. By implementing document approval workflows, organizations can streamline their document management processes and enhance overall efficiency.
Traditionally, document workflow management relied on manual tasks, such as printing, scanning, mailing, manual data entry, the physical transmission of documents across the hierarchy for approval, etc. With the advent of automation tools, businesses are now leveraging automation to better manage their document workflows.
In this article, we will define and explore the role of automation in document workflow management.
What is document workflow automation?
Document workflow automation is part of the larger area of business workflow automation and refers to the use of intelligent tools to manage the movement of documents within an organization involving various individuals, workers, and departments. It serves as a means for businesses to efficiently handle their paperwork by guiding documents through predefined paths and operational actions until they reach their final destination or outcome. By implementing workflow automation, organizations can achieve enhanced work efficiency and streamlined operations.
Document workflow automation is useful in almost all realms of business because all activities of any company require large volumes of paperwork. Let us, for example, see how document automation workflow can help the Accounts Payable Department in the procure-to-pay process – a routine business operation that involves a significant amount of paperwork, approvals, and routing.
- Document Receipt: The process begins with the capture of relevant procurement documents such as invoices, customer orders, purchase orders, and receipts. This can be done through various means, including scanning physical documents or electronically receiving them from vendors.
- Document Extraction: Automation tools can extract key data from the captured documents using technologies such as optical character recognition (OCR) or intelligent document recognition (IDR). This enables the system to capture important information like invoice numbers, vendor details, line item descriptions, and amounts.
- Data Validation and Verification: The extracted data is validated against predefined rules and matched with corresponding purchase orders and receipts to ensure accuracy and consistency. Two-way and Three-way matches are performed. Discrepancies or exceptions can be flagged for further review and resolution.
- Workflow Routing: The automated system routes the documents to the appropriate stakeholders for review and approval based on predefined workflows. This can include individuals responsible for verifying line items, checking for contract compliance, or authorizing payments. The system ensures that documents are sent to the right individuals in a sequential or parallel manner, depending on the workflow design.
- Approval and Exception Handling: Stakeholders receive notifications and can review the documents electronically. They can approve, reject, or request additional information as needed. Exceptions, such as price discrepancies or missing information, can be flagged for resolution before proceeding with further steps.
- Integration with ERP Systems: The automated document workflow system integrates with the organization's Enterprise Resource Planning (ERP) system, allowing for seamless data transfer and updating of financial records. Approved documents and relevant data are automatically captured in the ERP system, ensuring consistency and eliminating the need for manual data entry.
- Payment Processing: Once the documents have gone through the necessary approvals and validations, the system generates payment instructions based on the approved data. This can trigger the payment process, whether it involves generating checks, initiating electronic fund transfers, or utilizing other payment methods.
- Audit Trail and Reporting: Throughout the automated procure-to-pay process, the system maintains a comprehensive audit trail, documenting each action taken on the documents. This audit trail serves as a record for compliance purposes, internal audits, and reporting requirements.
Another area that can benefit greatly from document workflow automation is the HR department. A prime example is the onboarding process for new hires, which often involves time-consuming tasks like background checks and manual data entry. With document workflow automation, these tasks can be automated, freeing up HR employees to concentrate on more meaningful and engaging projects. This automation not only enhances HR efficiency but also extends to other departments such as IT, marketing, finance, legal, and sales, enabling them to automate routine tasks and boost overall productivity. By implementing document workflow automation, HR departments can streamline their operations, improve productivity, and allocate resources to more strategic initiatives that add value to the organization.
Customer data management is yet another area that benefits from the automation of document workflow. By utilizing standardized templates and leveraging API requests, organizations can automatically insert dynamic customer information into documents. For instance, when a customer submits their information through an online web form, a proposal can be automatically generated with their details, including their full name, address, company name, contact information, and more. Different templates can be set up for various workflows and operations, ensuring personalized and efficient document creation based on specific customer information.
In the healthcare industry, efficient management of patient records is paramount. Automating the document management process simplifies the generation and maintenance of medical records, enabling healthcare providers to deliver superior patient care. Automation platforms offer a secure and centralized repository for storing and accessing medical records, prescription information, and treatment plans, empowering healthcare professionals to provide enhanced healthcare services.
Similarly, in the education industry, automating document management can revolutionize administrative processes and enhance the student experience. Schools and universities can consolidate all student records, including transcripts, registration forms, and financial aid documents, into a single location, improving data accessibility and ensuring data accuracy. Automation also aids educators in optimizing processes like grading, assignment submissions, and attendance tracking, ultimately improving overall operational efficiency.
Benefits of document workflow automation
According to McKinsey research, it is estimated that 50% of work can be automated, and around 31% of businesses have already embraced automation for at least one of their functions. This highlights the increasing recognition of the benefits derived from automating various aspects of business processes. The demand for streamlined communication, efficient resource allocation, and robust IT systems has further fueled the growth of the global business process automation market. Projections indicate that by 2026, this market is expected to reach a value of $19.6 billion. This signifies the widespread adoption of automation technologies to enhance productivity, reduce manual effort, and optimize operational efficiency across industries.
Document workflow automation evolved from document management systems (DMS), which were developed in the late 1980s. The first commercial DMS product was introduced in the early 1990s, primarily focusing on document organization and storage. However, as organizations recognized the need for more advanced functionalities, DMS systems have evolved to incorporate features such as document version control, comprehensive security modules, and document workflow capabilities. The incorporation of workflow management into DMS has naturally led to impressive growth in its market size; in 2021, the global market size for DMS, which was valued at USD 5.00 billion USD, is slated to reach an impressive 16.42 billion by 2029.
Some specific advantages of document workflow automation include:
- Expedited Document Generation: Manual document creation is a laborious and time-consuming endeavor. Automating the process eliminates the need for manual data entry and streamlines collaboration, enabling businesses to generate invoices, contracts, and proposals in minutes rather than weeks. For example, through digitization of the documentation process, St. Louis Public School District reduced staff requisition time from three weeks to three hours.
- Error Reduction: Manual data entry can lead to a staggering 40% probability of human errors, causing significant technical and financial challenges for organizations. Document automation minimizes the likelihood of mistakes by automating data entry, flagging potential errors, and validating data at the point of entry.
- Better Collaboration: Collaborating on manual document creation often involves complex tracking and communication, resulting in errors and delays. Document automation provides a centralized platform where stakeholders can work together in real-time, reducing wait times and minimizing the need for lengthy email chains and meetings.
- Consistency and Version Clarity: Document automation ensures clarity regarding the latest document version, offering version control and maintaining consistency. Automation tracks changes, identifies the most recent version, and enables businesses to establish templates and standards for consistent formatting.
- Data Security: Manual document creation poses risks of data breaches and loss. Document automation provides a secure digital platform for document creation and storage, with features such as access controls, encryption, and audit trails, ensuring the protection of sensitive information.
- Environmental benefits: According to the EPA, the average office worker generates around two pounds of paper and paperboard products daily, resulting in a significant amount of office waste. Common sources of waste include printing errors, poor photocopies, outdated memos and reports, and obsolete periodicals. Remarkably, paper waste accounts for approximately 90% of all office waste. Implementing legal document automation may not entirely eliminate paper waste, but it can have a substantial impact on improving accuracy and reducing errors that contribute to paper waste
- Enhanced bottom line: Document automation yields significant financial benefits by reducing costs associated with manual processes, including printing, mailing, and physical storage. Moreover, automation saves time and effort, allowing staff to focus on value-added activities. It also improves invoicing and payment processes, ensuring prompt and accurate payments.
How to automate document workflows with Nanonets?
Nanonets is an intelligent AI-based document automation software that offers a range of tools and features to automate document approval processes through no-code rule-based workflows. With Nanonets, teams can efficiently manage various aspects of document workflow, including how information enters and moves through the workflow, checkpoints for comments and approvals, and assigning tasks to team members.
With Nanonets, businesses can enhance their document workflow management in several ways:
Automated Task Execution:
- Automate repetitive tasks such as data extraction and validation within the workflow, saving time and reducing manual workload.
- Establish conditions and rules to streamline document processing based on specific field values.
- Automatically classify incoming documents, such as invoices, claim forms, customer orders, purchase orders, contracts, and receipts, improving organization and data extraction.
- Determine access rights, ensuring that only authorized personnel can view or edit sensitive documents.
Advanced Document Processing:
- Utilize advanced OCR technology to accurately recognize text, numbers, and characters from various types of documents, including handwriting and machine-printed text.
- Harness deep learning algorithms to understand the context of the data, enabling accurate extraction from complex and unstructured documents.
- Customize the model by adjusting extraction rules and train it using sample documents allowing for precise data extraction.
Workflow Automation:
- Create approval workflows with ease using templates and customizable parameters.
- Define reviewers, rules, and stages to ensure efficient document review and approval processes.
- Run defined rules on autopilot for each document, minimizing errors and eliminating approval bottlenecks.
- Streamline collaboration and communication across departments, reducing bottlenecks and enhancing overall productivity.
User-Friendly Interface and Integration:
- Benefit from a user-friendly interface that facilitates easy review and correction of extracted data, ensuring data accuracy.
- Export extracted data in multiple formats, such as CSV, JSON, and Excel, for seamless integration with other systems.
- Utilize multi-language support, enabling extraction from documents written in different languages.
- Leverage API integration to integrate Nanonets with existing tools and systems, such as accounting software, ERPs, and CRMs.
Insights and Scalability:
- Gain valuable insights through comprehensive reporting and analytics, allowing for performance monitoring and bottleneck identification.
- Continuously optimize workflows based on data-driven improvements to achieve maximum efficiency and productivity.
- Benefit from the scalability of Nanonets, enabling efficient handling of large volumes of documents and data.
By leveraging the capabilities of Nanonets, businesses can streamline their document workflow management, enhance accuracy, improve data security, and achieve greater efficiency in their document-related processes.
Take Away
According to Gitnux, the implementation of workflow automation results in an 88% improvement in data accuracy. Studies have shown that up to 72% of workers believe that inefficient processes have a detrimental impact on their job satisfaction. In the absence of digitization and automation, employees often experience heightened levels of frustration, stress, and overall dissatisfaction.
Document workflow automation is a transformative solution that offers a multitude of undeniable benefits. By implementing automation, businesses can witness increased productivity and throughput, along with a significant improvement in data accuracy. Embracing a rules-based process automation platform like Nanonets can help companies establish a centralized and streamlined process for generating, editing, and signing critical documents. The user-friendly interface empowers users to effortlessly track and manage all documentation, eliminating the reliance on outdated paper-based systems.
If you're eager to unlock the advantages of document automation and enhance your organization's operational performance, our experts are available to provide guidance. They can walk you through the remarkable features and capabilities of Nanonets, helping you determine if it aligns with your specific requirements. Don't miss out on the opportunity to streamline your document management processes and optimize your workflow. Embrace the power of automation and propel your business toward greater efficiency and success.
FAQ
What is document workflow automation?
Document workflow automation is the process of using technology and software to automate and streamline the management of documents within an organization. It involves digitizing, organizing, and optimizing document-related tasks such as creation, editing, reviewing, approval, and distribution. By replacing manual and paper-based processes with automated digital workflows, document workflow automation improves efficiency, accuracy, and productivity. It reduces the risk of errors, saves time and resources, enhances collaboration, and ensures compliance with regulations.
How do you automate a workflow document?
First, choose a workflow management tool or software that suits your organization's needs and integrates well with your existing systems. Next, identify the stages and steps involved in the document workflow, including creation, editing, reviewing, and approval. Map out the sequence of tasks and define rules and conditions for each step. With a workflow management tool, you can often use a visual editor or drag-and-drop functionality to design the workflow. Assign specific stakeholders to each step, set deadlines, and establish notifications or reminders for task completion. Additionally, you can configure the workflow tool to automate actions based on specific conditions, such as automatically routing documents for approval or triggering notifications. Once the workflow is designed and configured, test it with sample documents to ensure it functions correctly. Finally, deploy the automated workflow for everyday use, continuously monitor its performance, and make improvements as needed to optimize efficiency and effectiveness.
What is the best way to document a workflow?
The best way to document a workflow is to use a combination of text descriptions and visual representations. Start by providing a clear and concise written description of each step involved in the workflow, including the inputs, outputs, and any dependencies or conditions. This helps to ensure a comprehensive understanding of the process. Additionally, use visual aids such as flowcharts, diagrams, or process maps to visually represent the workflow. Visual representations can make the workflow easier to comprehend, identify bottlenecks or inefficiencies, and facilitate communication and collaboration among team members. Using a combination of written descriptions and visual representations provides a comprehensive documentation of the workflow that is both clear and accessible to all stakeholders involved.
What are the benefits of automating document workflow?
Automating document workflow offers several benefits that significantly improve operational efficiency and productivity. It reduces manual effort and human error, leading to increased accuracy and data quality. It streamlined the flow of documents, enabling faster processing and reduced turnaround times. Automation also ensures consistency and adherence to predefined rules and processes, minimizing variations in document handling. By centralizing document management, it enhances collaboration and communication among team members, eliminating the need for manual handoffs and reducing delays. Automating document workflows also enhances data security and compliance by implementing access controls, audit trails, and encryption measures. Automation also enables real-time tracking, monitoring, and reporting, providing valuable insights into document status, performance, and bottlenecks. It improves overall productivity by freeing up time and resources that can be redirected to higher-value tasks. Finally, automating document workflows optimizes organizational processes, reduces costs, enhances customer satisfaction, and supports effective decision-making.
