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What is Document Automation? How it Works & Benefits

Automation is revolutionizing the way that organizations generate and manage documents.

By digitizing and simplifying the creation, population, routing, and storage of paper and electronic documents, organizations can eliminate manual, repetitive tasks, accelerate cycle times, reduce operations overhead, enhance customer service, and strengthen security and compliance.

Document automation also can accelerate an organization’s digital transformation initiatives.

And artificial intelligence (AI) with machine learning has enabled document automation solutions to perform increasingly complex tasks with greater accuracy, driving even greater return on investment.

It’s no wonder that the global document automation software market is expected to reach $13.8 billion by 2028, according to Grand View Research. In fact, 70 percent of new enterprise applications will be built with document automation capabilities, Gartner predicts.

This article shows how document automation works and the benefits the technology provides.

Why document automation?

Creating, routing, and storing inbound documents is no small feat for most organizations. Manual and semi-automated approaches to managing documents can create significant challenges.

  • Inefficiency. Manual and semi-automated document processes bog staff down with manual keying, paper shuffling, mistakes, lost information, and calls from frustrated customers.
  • Errors. Errors are inevitable whenever there are manual processes. A single typo or transposed number can result in rework, customer frustration, and compliance issues.
  • High costs. Manual document processing tasks require lots of labor as well as paper and paper-related consumables. Physically storing and retrieving documents also is costly.
  • Slow cycle times. Manually sorting documents, chasing down approvals, and resolving errors can lead to delays that result in missed opportunities and strained client relationships.
  • Customer impact. Customers expect a fast response to their inquiries. But locating and retrieving physical documents from a file cabinet or storage room takes lots of time. And there’s always the possibility that a document will become misfiled, lost, or damaged.
  • Poor collaboration. Paper documents make it extremely hard for geographically dispersed team members to collaborate and communicate effectively, or to easily access information.
  • No standardization. Organizations receive documents in many formats, through many delivery channels. A lack of standardization can make it hard to implement best practices.
  • Risk. Manual and semi-automated document processes leave organizations vulnerable to internal and external bad actors. It’s hard to control and protect sensitive data on paper.

These are some of the reasons that more organizations are automating their document processing.

How does document automation work?

Document automation solutions digitize and simplify the receipt, creation, population, routing, and storage of contracts, applications, onboarding forms, claims, and other documents.

While the document automation cycle may vary depending on an organization’s needs, workflows, and business requirements, the process typically includes the following capabilities.

  • Templates. Document automation solutions enable users to create templates for the types of documents that they generate frequently. Having standardized templates with designated fields for inserting variable data boosts efficiency and data accuracy. Some solutions enable users to dynamically adjust the content of documents based on pre-set criteria or variables.
  • Input. Variable fields within the document templates are populated with information entered manually or through an integration with external data sources, databases, or spreadsheets.
  • Routing. In some document automation solutions, organizations can define the distribution, reviews, and approvals. Defining the steps and processes that document go through speeds cycle times, improves efficiency, and helps ensure process standardization and control. In some cases, electronic signatures may be required as part of the review and approval process.
  • Control. Automated solutions track all changes and revisions made to a document to provide accountability and to ensure that users are working with the latest version of the document.
  • Storage. Documents are digitally stored in a centralized cloud-based repository. Authorized users can instantly access stored documents at any time, from any location, using any device.
  • Integration. The best document automation solutions use robotic process automation (RPA) and other means to seamlessly connect with other customer relationship management (CRM) applications and other legacy systems to ensure the smooth exchange of documents and data.

These capabilities eliminate the manual, time-consuming tasks associated with managing documents.

Benefits of document automation

Document automation provides tremendous benefits to organizations of all sizes.

  • Efficiency. With automation, an organization can create, process, approve, and retrieve documents in a fraction of the time it takes in a manual or semi-automated environment.
  • Reduced costs. Document automation solutions eliminate the time and resources to create documents, manually input information, and physically route documents for approval. Automation also eliminates the cost of paper and paper-related consumables and storage.
  • Accuracy. With predefined templates, automated data capture, and pre-configured workflows, automation significantly reduces the possibility of mistakes and errors.
  • Productivity. By eliminating manual, repetitive tasks such as keying data and shuffling paper and emails, staff have more time for data analysis and other value-added activities.
  • Standardization. Standardizing the structure of documents with a consistent format, content, and style helps ensure that documents adhere to organizational standards.
  • Faster cycle times. Electronic signatures and configurable workflows speed cycle times and decision-making by eliminating the need for manual paper routing and physical signatures.
  • Enhanced visibility. Document automation puts smart insights at the fingertips of the people who need them, when they need them. And dispersed stakeholders can easily collaborate and communicate with the assurance that they are using the latest version of a document.
  • Compliance. Systematic workflows, user permissions, complete audit logging, and other built-in controls help organizations adhere to industry standards and legal obligations.
  • Security. Document automation solutions use access controls, audit logging, advanced data encryption and other built-in measures to safeguard sensitive data and ensure confidentiality.

These are some of the ways that automation transforms traditional document processes.

Who uses document automation tools?

Document automation can be used by organizations of any size, across any industry.

  • Legal. Law firms use document automation to streamline the creation of legal documents, contracts, and agreements to save time and ensure document consistency and accuracy.
  • Banking. To improve accuracy and process compliance, banks use document automation to generate financial reports, loan documentation, and compliance-related documents.
  • Insurance. Document automation enables insurers to streamline the generation of policies, claims and other documents and to help automate workflows for policies and endorsements.
  • Human resources (HR). Automation streamlines employee onboarding by making it easy for HR departments to create employment contracts, offer letters, and other documents.
  • Healthcare. Healthcare organizations use document automation to manage patient records, clinical trial documentation, and regulatory documents more efficiently and accurately.
  • Government. From procurement and contract management to licensing and permitting, document automation improves efficiency and transparency across government operations.
  • Manufacturing. Manufacturers use document automation solutions across their supply chain to process orders, manage inventory, and process quality control documents accurately.
  • Education. Automation simplifies the creation of academic documents and student records.

Any organization with document-intensive processes can benefit from document automation. The best technology providers tailor their solutions to meet the unique needs of different industries.


Managing documents shouldn’t be a burden on organizations. Document automation solutions make it easy and secure to create, populate, route, and store any document, regardless of its complexity.

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