Why do companies still prefer manual data entry?

Yes, but… why? It’s slow, error-prone, and expensive. Typing information into spreadsheets is a tedious task that consumes resources and saps employee enthusiasm. Manual data entry is a repetition of tasks that are simple enough that a machine could do them…

So, let’s get this straight. Despite the widespread use of data entry automation, some companies insist on having their teams punch keys all day. This risks employee burnout, costly mistakes, and reputational damage. But why persist when AI can extract data from any document and insert it into spreadsheets, ERP systems, databases, and other business software?

In this article, we’ll explore how manual data entry compares to automated data entry. We’ll explore why some companies will continue to invest in manual data entry, the harm it can cause, and the benefits of automated data entry. We’ll also look at industries that are enthusiastically embracing automated data processing.

Manual Data Entry: A Return to the Digital Past

Manual entry is the old way of moving data from documents – invoices, quotes, customer details, receipts, orders, product specifications – into ledgers, spreadsheets, databases, etc. Documents read and typed by people. Day in and day out. A thankless task, but essential. In a growing digital world, businesses are forced to expand. There is no choice. Asking your team to process thousands of documents is unreasonable, impractical, unimaginable.

Why Persist with Manual Entry?

Despite the challenges, some businesses still opt for manual entry, especially for handwritten text or medical records. Here are some of the benefits of manual entry:

• Ideal for small businesses with limited budgets
• No need to purchase expensive software
• Limited access to sensitive data
• No need to train employees on new programs
• Minimized risk of cyber attacks

However, this cost-effective choice comes with consequences. Businesses that rely on manual entry will be left behind, suffering a decrease in productivity, performance, and customer and employee satisfaction, which will directly impact their bottom line. Hidden costs include late payment fees, quality assurance, compromised supplier relationships, and reputational damage.

The Hidden Cost of Not Innovating

As you work toward your goals, your processes are slowing down. Errors abound due to inaccurate data entry, and your team is dissatisfied. As your company grows and bureaucracy increases, are you ready to scale your document processing?

Here’s what you’re missing by not investing in automation:

• Inefficient data entry
• Compromised internal collaboration
• Lack of internal controls
• Low match rates
• Low quality data
• High employee turnover
• Compromised supplier relationships

Will your team be able to handle growth? Are you prepared for economic instability?

Disadvantages of Manual Entry: The Truce Between Choices

Before deciding between manual entry and automation, let’s look at some data. According to a Goldman Sachs report, manual invoicing costs $2.7 trillion for global businesses. Human error is an old story that persists. In 2006, Alitalia announced business class flights for $39 instead of $3,900 in Toronto. A data entry error that cost the company $7.2 million.

Human errors are inevitable in manual entry, and can be caused by:

• Insufficiently trained teams
• Documents with unlabeled fields
• Inconsistent formatting
• Misprints or confusing data
• Unclear handwritten documents
• Stress, distractions, boredom
• Clumsy fingers

If the error rate exceeds 1%, it can seriously damage the company’s reputation. Outsourcing data entry is an alternative, but it comes with security risks, inconsistency, and high costs. And now, the enlightening conclusion: the innovation of automatic data entry.

Data Quality Control: The Cost of Perfection

Academic researcher Joel E. Ross’s concept of Total Quality Management explains how integrating an organization’s functions and processes leads to continuous improvement of its products and services, meeting consumer needs.

The 1-10-100 rule, known as the cost of quality, clarifies the following:

• Preventing an error will cost your company $1
• Correcting an error will cost your company $10
• An uncontrolled error that causes a failure will cost your company $100

Data quality control is crucial. When a team manages manual entry, there is a greater likelihood of errors, corrections, and failures, leading to higher costs. Investing in automated data capture software eliminates these costs, ensuring a quick return on investment and improving employee retention rates.

Processing Time: Fighting Slowness

Manual data entry is… sooooo slow. While a good typing rate is 10,000 characters per minute, the average person can enter 7,000-8,000. Necessary breaks for bathroom breaks, lunch breaks, or a chat with colleagues further slow down the process.

In contrast, AI doesn’t need breaks and can manage the process more efficiently. The time saved can be spent on more productive activities such as research, analysis, strategic planning, and supporting other teams, improving the company’s bottom line.

Automatic Data Entry: The Breakthrough Innovation

Automatic data entry converts data into readable formats and automatically loads it into your database. It uses technologies such as machine learning (ML), robotic process automation (RPA), and artificial intelligence (AI). This solution outperforms manual entry and outsourcing hands down.

Benefits include:

• Fast turnaround and meeting deadlines
• Increased business scalability
• Reduced implementation and training costs

When comparing Manual Data Entry vs. Automatic Data Entry, automatic technology is faster, requires less human interaction, and offers a host of benefits

Benefits of Automatic Data Entry: A Leap in Productivity

According to the World Economic Forum’s 2020 Future of Jobs report, while AI will replace 85 million jobs by 2025, 97 million new jobs will be created through AI.

Automatic data entry offers many benefits:

• Increased productivity: Compared to manual data entry, AI speeds up the process, allowing your team to focus on more creative and profitable projects.
• Improved data accuracy: Accurate data supports strategic decisions and prevents losing customers due to poor service.
• Reduced costs: Compared to hiring new staff or outsourcing, AI offers a more cost-effective solution.
• Reduced training: Solutions like Retica require minimal training thanks to an intuitive user interface and effortless implementation.

With automatic data entry, your team will be freed up to focus on more interesting and strategic projects, improving the value generated for the company.

Industries Leveraging Automatic Data Entry: A Revolution in Business Processes

Data processing is crucial in many industries, especially in enterprise businesses, due to the vast volume of information handled on a daily basis. Let’s take a closer look at three industries that are revolutionizing the data acquisition process and taking full advantage of the benefits of automation.

Financial Services: Modernizing Financial Processes with Retica

AI-based OCR and natural language processing solutions, like Retica, are helping CFOs revolutionize document processing. These technologies extract data from bank statements, handwritten surveys, bank checks, emails, image files, and letters. A case study with The Master Trust Bank of Japan shows how the bank reduced manual workload by 75%.

Logistics: Optimization with Intelligent Document Processing

With the logistics industry growing rapidly and projected to reach nearly $13 trillion by 2027, intelligent document processing is essential. This technology enables faster transportation of goods, improved accuracy in automatic document classification, real-time insights to optimize business processes, and more effective internal communication.

Administration: Revolution in Invoice Processing

Debt administration, often hampered by lost invoices and manual data entry errors, is embracing automation. Automated document processing offers significant benefits:

• Invoice Capture: The process begins with the receipt of the invoice, which is uploaded to an invoice processing system for data capture.
• Streamlined Approvals: Invoices are automatically sent to the appropriate authority to reduce delays and errors.
• No Manual Data Entry: AI-based optical character recognition software will scan paper documents and capture data, speeding up the debt administration process.

Setting Data Processing Goals: A Strategic Choice

Setting data processing goals that align with your business goals and growth plan is critical. A thorough analysis of your current technology infrastructure is essential to avoid unnecessary costs in the future. Key questions include:

• Current Tools: What is your current technology stack and which tools can be integrated into the new automation solution?
• Elimination of Tools: Which tools can be eliminated to optimize efficiency?

Finding Document Processing Providers: Crucial Questions

Before committing to automated data processing, it is essential to ask key questions:

• Budget: What is your budget for implementing an automation system?
• Document Volume: How many documents do you need to process?
• Database Size: What is the size of your database?
• Tools/Software Integration: What tools or software do you want to integrate?
• Number of Users: How many users will you involve in the process?
• Team Technology Competence: Is your team technology-oriented or will they need training?
• Implementation Timing: When do you want to implement the system?