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March 28, 2024

AI Document Analysis: A Comprehensive Guide

Author:




Artur Haponik

CEO & Co-Founder


Reading time:




8 minutes


Data is the lifeblood of many organizations today. However, despite the technological advances the world has made in recent years, some organizations still spend hundreds of hours manually analyzing information from documents. This process is usually tedious, time-consuming, and costly. Manually analyzing documents is also more likely to lead to errors and inconsistencies.

This is where AI document analysis comes into play. It automates and streamlines many processes, allowing organizations to analyze large volumes of documents more practically and efficiently. In this post, we’ll provide an in-depth review of what AI document analysis is and how organizations can leverage it in their daily operations.

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What is AI document analysis?

AI document analysis basically refers to the use of Artificial Intelligence (AI) techniques such as Machine Learning (ML), Natural Language Processing (NLP), Automation & Robotics, and Machine Vision (MV) to analyze and extract valuable information from large volumes of documents. By using these techniques, organizations can easily analyze their documents in a matter of minutes, a process that would otherwise take hours or days if performed manually.

For example, the banking industry handles millions of loan applications, mortgage applications, invoices, contracts, memos, withdrawal slips, deposit slips, and other forms of paperwork daily. If these documents were to be analyzed manually, it would take thousands of man-hours, be prone to mistakes and account for a big portion of the industry’s yearly budget. Fortunately, banks do not have to follow that path.

With the help of AI document analysis, banks can easily analyze and categorize documents to locate specific information. This helps to maximize operational efficiency in the entire banking industry.

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How AI can be used for document analysis

Here are various ways in which Artificial Intelligence (AI) is revolutionizing document analysis:

Optical Character Recognition (OCR)

Optical Character Recognition (OCR) technology is usually used to identify and convert handwritten or printed text on a scanned document into machine-readable and searchable text. Doing this makes it easier for organizations to extract any information they need from documents, facilitating accurate and efficient document analysis.

Optical Character Recognition (OCR) for AI document analysis

You can use AI-powered OCR technology to turn a picture of a text or a handwritten note into something like a PDF, DOC, or TXT file. This technology is ideally optimized for large text-heavy documents in various file formats and languages.

Natural Language Processing (NLP)

Natural Language Processing (NLP) is a branch of AI that enables computer systems to identify, understand, interpret, and manipulate human language. When it comes to document analysis, NLP algorithms are tasked with extracting specific information from documents and performing sentiment analysis. This way, organizations can categorize their documents, extract relevant information, provide valuable insights, and make important predictions.

Document summarization

AI-powered models can be used to break down huge documents into smaller and more concise paragraphs or sentences. This makes it possible to get an overview of the main points or message of a given document without having to read the whole thing. This is particularly beneficial among data professionals who are required to review and extract specific information from documents in the shortest time possible.

Translation

Organizations can use AI-powered models to translate documents from one language to another in real time. This makes cross-language document analysis possible and allows data professionals and organizations to share information in different parts of the globe. By using AI in language translation, the world becomes an even smaller global village.

Document classification

With the help of AI in document analysis, organizations can easily categorize thousands of documents based on their content and purpose in the shortest time possible. This helps organizations protect confidential or sensitive data and manage their data in a structured manner under a single document repository.

AI Document analysis - document classification, document analysis

Sentiment analysis

Some AI-powered models can use Natural Language Processing (NLP) to deduce the emotional tone and attitude in various texts such as customer reviews and social media posts. Sentiment analysis is vital because it helps businesses identify and address various customer pain points, thus improving overall customer service.

With the help of sentiments, businesses are also able to understand customers’ needs and expectations and develop products that meet them.

Data extraction

Various AI models have been ideally trained to extract specific data from documents. Such data include names, physical addresses, email addresses, phone numbers, case IDs, dates, ZIP codes, credit card numbers, and other forms of structured data. [1] As a result, professionals do not have to spend hours inputting various keywords to extract certain information. This helps speed up the entire document analysis process.

Read more about AI-driven text summarization: Challenges and opportunities

How does AI document analysis work?

AI document analysis works by leveraging various AI techniques to identify and extract specific information from structured and unstructured data. Additionally, it performs repetitive processing tasks, provides valuable insights, and helps automate operations involving physical documents. The technology also goes a step further to organize the documents in a manner that is easy to compile and analyze.

AI document analysis process

Here are the various steps involved in document analysis using AI:

  • The document that requires analysis is uploaded to the computer system for assessment.
  • Optical Character Recognition (OCR) identifies the type of document and categorizes it accordingly.
  • The information is reviewed, interpreted, and extracted by Natural Language Processing (NLP).
  • Machine Learning (ML) and Deep Learning (DL) models identify underlying relationships in a given set of data and validate it. At this stage, only the relevant information is extracted, while the rest is discarded.
  • Straight-through processing (STP) takes place and allows you to view the extracted data in your preferred format. [2]

Benefits of AI document analysis

In addition to the several use cases, AI  document analysis brings multiple benefits to organizations. These benefits include:

Time savings

Manual document analysis is a tedious and time-consuming process. This process is also prone to mistakes which means that more man-hours are needed to identify and correct them.

On the other hand, automating document analysis processes saves time and frees up employees to perform other important tasks. A recent report by PwC states that automating data analytics saves organizations 30-40% of the time normally spent on such processes. [3]

Fraud minimization

In addition to speeding up document analysis, AI techniques such as Machine Learning can be used to identify and prevent instances of fraud. [4] In the long run, this helps save organizations millions of dollars that would otherwise be lost to fraud.

Improved productivity

Automating document analysis in the workplace also improves employee performance and productivity. By using AI models to complete repetitive document processing tasks, employees are able to get more work done quickly.

AI document analysis – the bottom line

AI document analysis is a great technique that provides organizations with several benefits, such as increased efficiency, improved accuracy, and the capability to analyze many documents in a matter of minutes. If implemented properly, this technique can potentially transform several industries, including banking & finance, retail, accounting, warehousing, insurance, and human resources (HR).

Ebook: AI Document Analysis in Business

AI Document Analysis: A Comprehensive Guide: FAQ

What industries can benefit from AI document analysis?

AI document analysis offers benefits across various industries, including but not limited to:

  • Banking and Finance: Streamlining loan applications, mortgage processing, invoice management, and fraud detection.
  • Healthcare: Automating patient record analysis, insurance claims processing, and medical billing.
  • Retail: Enhancing inventory management, invoice processing, and supply chain optimization.
  • Legal: Expediting contract analysis, legal document review, and case management.
  • Human Resources: Facilitating resume screening, employee onboarding, and compliance document management.
  • Insurance: Accelerating claims processing, policy underwriting, and risk assessment.
  • These industries, among others, can leverage AI document analysis to improve operational efficiency, reduce costs, and enhance decision-making processes.

How accurate is AI document analysis?

The accuracy of AI document analysis depends on various factors such as the quality of data, the complexity of documents, and the algorithms used. Generally, AI document analysis systems can achieve high levels of accuracy, often surpassing human capabilities in tasks like Optical Character Recognition (OCR) and data extraction. However, it’s essential to regularly monitor and fine-tune AI models to maintain accuracy levels, especially when dealing with diverse document types and languages.

What are some limitations of AI document analysis?

While AI document analysis offers numerous benefits, it also has certain limitations to consider:

  • Complex Document Structures: AI may struggle with analyzing documents that contain complex layouts, unusual fonts, or inconsistent formatting.
  • Language Limitations: AI models trained on specific languages may not perform well with documents in other languages, leading to translation errors or misinterpretations.
  • Sensitive Information Handling: AI document analysis systems must adhere to strict privacy and security protocols to ensure the confidentiality of sensitive data within documents.
  • Contextual Understanding: AI may struggle to grasp the nuanced meaning or context of certain phrases or sentences, leading to misinterpretations in sentiment analysis or summarization tasks.

References

[1] Prowebscraper.com. Structured vs Unstructured Data: Best Thing You Need to Know. URL: https://prowebscraper.com/blog/structured-vs-unstructured-data-best-thing-you-need-to-know/. Accessed July 06, 2023
[2]Investopedia.com. Straight Through Processing. URL: https://www.investopedia.com/terms/s/straightthroughprocessing.asp. Accessed July 06, 2023
[3] PWC.com. Its Time to get Excited About Boring AI. URL: https://t.ly/bOcY. Accessed July 06, 2023
[4] Forbes.com. Top 9 Ways AI Prevents Fraud. URL: https://www.forbes.com/sites/louiscolumbus/2019/07/09/top-9-ways-artificial-intelligence-prevents-fraud/. Accessed July 06, 2023



Category:


Artificial Intelligence