Document automation, for most organizations, is like the best thing since sliced bread. You save money, you save time, you deliver a better experience for end-users, etc.
What’s not to love?
With that being said, not everyone understands document automation and what it can do for organizations of all sizes.
In this guide, we’ll answer the question ‘what is document automation’ with a succinct definition, help you understand all the moving parts, and even share multiple use cases and examples with you.
Document automation definition
Document automation can be defined as the process of using technology – namely software – to collect data related to a document and then create that document without manual intervention. You set up a series of rules and conditions for the software to carry out when producing the document.
Successful document automation requires a base template and rules to guide the document creation process. This process can be as simple as inserting a few tags or as complex as creating many conditional rules based on if-then statements.
The document automation process has multiple ‘levers’ or components.
The different levers of document automation
When looking at the different aspects of document automation, it can be widely classified into four major levers or components. These levers can be further broken down based on how granular you’d like to get. We’ll stick to a high-level overview here.
Data collection
Without collecting the relevant data, document automation cannot occur. That’s because there are no inputs for the automation system to work with to change variable data in the document.
Data can be collected in multiple ways. For example, you may connect your document automation platform to your CRM or other data source so that any time a contact record is created, a document is generated.
Another method and one that’s native to most document automation tools is to have a custom interview questionnaire that collects data from your respondents.
Document creation
After data collection is document generation or creation. All the relevant data is collected from the data source and then added to the document. But, it’s not just inserted into the document. Other actions are performed like adding or removing certain sections of the document, including images, removing images, including raw information, or collecting data for other purposes.
A single data source, whether that’s an integration to pull information from a third-party tool or a customized interview questionnaire, should be able to create multiple documents.
For example, if you’re creating an employment agreement, you may also need a non-compete and an NDA. Instead of needing to fill out multiple forms, you’ll be able to accomplish this outcome with a single questionnaire.
Data routing
The data routing lever is a major factor in elevating the process from simple document assembly to robust document automation. Data routing is the ability to send your generated documents and other pieces of data that you’ve collected to other places.
For example, let’s say an employment agreement has just been created, you can set up a data routing process to send that document out to be signed by you, HR, and the employee. The same with the NDA and the non-compete agreement.
At the same time, you may also send the employee data you’ve collected to your HR tool to open a new employee record. Their name, address, and any additional information will be automatically populated. You can send the documents to yourself or others in your organization or just set up notifications to go out whenever a new document is created.
The ways to use data routing to enhance your existing processes is only limited by your imagination.
Document management
The last lever is document management. What do you do with the documents after they’ve been generated? How do you access them, download them, and share them? What about the templates used to create those documents? Can you make changes to them and collaborate with other people on your team (or even your clients)?
What about organization? Can you store documents and templates in a way that makes them easy to find? The best document automation tools make these processes possible.
Together, these levers move document automation well beyond a simple document assembly solution. Of course, a document generation tool has its own advantages and may be ideal in certain situations. If you want end-to-end document automation then true document automation software is the way to go.
Next, we’ll look at the many benefits associated with document automation.
Benefits of document automation
Speed
One of the most obvious benefits of automatically creating documents is speed. Instead of spending hours working on complex documents every time you need them, someone just needs to fill out a form – or trigger a workflow.
When that happens, the document is created in a few moments. At most, that time can be extended to a few minutes if many documents are generated from a single form.
Save on indirect costs
Creating a document manually has many costs that aren’t usually calculated. For example, after you make a document, it needs to be printed and stored. That means you’ll be paying for ink, storage space, and possibly transportation if you need to meet the person for a wet signature.
None of those expenses are necessary when you have a document automation platform.
Reduces human error
In a research paper published by Professor Raymond R. Panko, it was found that the likelihood of human error when manually entering repetitive data in a simple spreadsheet was between 18 – 40%. When data is manually entered into complex spreadsheets, the chance of error increases to 100%.
For complex spreadsheets, you’ll have at least one error but likely many more. Document automation helps reduce these errors because data entry – even for complex documents – is simplified. Also, the data being entered isn’t repetitive so people are less likely to make mistakes.
Better overall client/customer/end-user experience
This is an important one because the better the experience people have, the more likely they are to continue working with you or refer customers to you.
While the process of creating a document is a small part of your working relationship, it adds to the overall experience you provide clients.
Asynchronous and remote collaboration
People expect you to be able to collaborate with them on important projects from halfway around the world. That extends to their expectations for documents as well.
In many ways, remote collaboration can make you more efficient. For example, someone has traveled for work but deadlines still need to be hit. Remote collaboration makes that possible.
With document automation platforms like UsefulPDF, you can work with teammates or even ‘guest’ users to make sure documents turn out correctly. Whatever document automation solution you choose, there should be some level of collaboration available.
Easy to keep documents up-to-date
You have a single template that handles an entire document workflow. This template serves as the single source of truth for that document. Everyone in the organization should use it when they need to the agreement or whatever it may be.
Because of that, updating the document with new clauses, legal language, or formatting only needs to be done once. You don’t need to force everyone to go to the shared Google Drive or Dropbox folder to download the new version (which people will forget to do anyways).
By extension, this reduces your liability and enhances your compliance with relevant laws and regulations that may exist in your industry.
Consistency
One thing about using manual document creation is that clauses may appear similar but, in reality, they’re using different language to send the same message. Over time, the core message that’s trying to be delivered may be lost.
Document automation will ensure everyone in the organization uses the same clauses, language, formatting, etc. Going further, you can keep your branding consistent so the end user will always know they’re in the right place.
Document automation use cases
Now, let’s dive into the different ways document automation can be used in the real world. This is not an exhaustive list. Rather, it’s just a few things to chew on. Keep in mind that almost any document can be automated to some extent.
Real estate
Real estate is notorious for having a massive documentation requirement. The good news is that most agreements can be standardized and automated. For example, you can create a standard rental application, collect signatures, and even manage payments with a document automation tool.
Other ways to use document automation in real estate include:
- Work orders
- Lease agreements
- Late rent notices
- Eviction notices
- Mortgage documents
- Much more
Human resources
This is one of the most impactful areas that you can use document automation because it connects with other tools in your technology stack. A few ways you can use document automation for human resources include:
- Employment agreements
- NDAs
- Contractor agreements
- Non-compete agreements
- Requisition forms
- Application forms
- Etc.
Law firms
When people think about paperwork and legal documents, they think about law firms. Utilizing document automation can be a powerful way to standardize legal forms to deliver a better client experience.
- Name change
- Property memoranda
- Statements of work
- Memorandums of understanding
- Employment agreements
- Consent agreements
- Eviction notices
- So much more
In fact, the use cases that law firms can take advantage of with document automation eclipse other industries.
Financial services
Document automation allows firms to deliver bespoke financial services must faster because routine paperwork can be done in a fraction of the time. Some of the ways firms use document automation include:
- Consent agreements
- Retainer agreements
- Term sheets
- Investment contracts
- Loan documents
- Etc.
Again, we’re just scratching the surface of the many ways document automation can be applied for different types of users. As long as you’re creating documents in your organization, there’s a place for document automation. The list above should serve as a starting point as you think of ways to take advantage of this technology.
Conclusion
Document automation isn’t a magic bullet. It’s one of the many tools in your toolbelt to help you run a more efficient organization. This guide has explained what document automation is, the different components, the core benefits, and many use cases.
If you’re looking for a document automation solution, be sure to check out our product – UsefulDocs. It has the tools you need and will make sure you achieve your document automation goals.
