The current state of OCR; Optical Character Recognition
AnyDoc Software recently attended a conference of accounts payable professionals, where we sponsored a guest speaker. The speaker provided comment cards for feedback of his performance and content. On one card was a remark that floored me: "OCR? That doesn't work."   [more]

HERAE Launches Paperless Payment Processing for Healthcare Industry; First Commercial Offerings Expected to Save Billions for Payers and Providers
HERAE, LLC, a new business process management and Web services provider for the healthcare industry, today announced the introduction of paperless processing of electronic remittance advice for healthcare providers and health plan payers.   [more]

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Fiserv Signs Definitive Agreement to Acquire BillMatrix Corp., Provider of Expedited Electronic Bill Payment Services
Fiserv, Inc. announced today that it signed a definitive agreement to acquire BillMatrix Corp., a provider of expedited electronic bill payment services, adding a fast-growing niche to its already significant payments business. BillMatrix is expected to generate revenue of approximately $90 million in 2006. The purchase price is approximately $350 million, and the transaction is expected to close in the third quarter.  [more]

BasWare to Acquire the Travel Management Company Trivet Software
BasWare Corporation has agreed on acquiring the Finnish Trivet Software Oy that develops software solutions for electronic travel expense management. The acquisition price for the entire shareholding of Trivet Software is approximately EUR 0.9 million of which EUR 0.45 will be paid in cash and the remainder through a share exchange. The exchange requires a directed share offering to the shareholders of Trivet Software. [more]

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The current state of OCR; Optical Character Recognition

AnyDoc Software recently attended a conference of accounts payable professionals, where we sponsored a guest speaker. The speaker provided comment cards for feedback of his performance and content. On one card was a remark that floored me:

"OCR? That doesn't work."

I was stunned.

Was this merely the perception of one individual, or did it reflect the views of a significant portion of the workforce? Minus focus group data or other matrices, it's impossible to tell; however, it certainly was troubling. Troubling because not only has OCR been proven to work, but it works quite well.

Perhaps the perception of that one individual helps illustrate why only a small portion (approximately 15%) of businesses that could benefit from a solid data and document capture solution has actually taken advantage of it.

In order to bridge that gap, our industry needs to better educate the public about the strength and efficiency of OCR (and its companion, ICR) and how it can revolutionize data workflow. With any luck, people like our friend from the conference will begin to see OCR with different eyes, and those of us in the industry will have a renewed determination to inform businesses of all stripes of the benefits an OCR solution can provide.

Data Capture: Improving the Standard

It is true that OCR wasn't always as robust as it is today. In its infancy, OCR was fraught with errors, causing many businesses to forsake data capture for tried-and-true manual data entry. However, OCR/ICR has grown into a formidable, extremely accurate technology.

Data capture has always been dependent upon convergent factors for its success. A good scanner, a reliable OCR/ICR engine and a high-end processor all work in cohesion to quickly deliver high-quality data capture from paper documents and forms. Each of these elements has improved within the past five years, thereby delivering far better data capture, far quicker than before.

For one thing, scanners are much more affordable. Recently, the prices of many mid-grade and high-end scanners have come down considerably, giving smaller businesses easier entry into the world of forms processing to handle the volume they require.

Also within the past five years, TWAIN drivers have been developed to support production scanners at rated speeds, ensuring a robust performance and compatibility between the scanners and document and data capture applications--eliminating the need for add-on "middleware" or hardware boards.

And the software designed to enhance scanner output has also made tremendous strides, delivering much cleaner digital images. Kodak's Perfect Page, Kofax's VRS[R] and AnyDoc's proprietary software tools were all developed to help scanners produce the best scanned images possible. They help to deskew and align the images automatically, saving precious time otherwise dedicated to manual document preparation prior to scanning.

Character Recognition: the Strength of OCR

Of course, a clean, straight image makes data capture much easier, but OCR/ICR processing has also made quite a bit of headway in the past three years or so. OCR and ICR speed and accuracy is exponentially better than it's ever been. The technology now can process full OCR/ICR on a page in under half a second. To put it in perspective, OCR/ICR took about 45 seconds per page when we first began to develop data and document capture technology more than 15 years ago.

The systems running the OCR and ICR continue to become faster, and that obviously affects the results. The speed is useless, however, if the end-result is sloppy data. Fortunately, the OCR and ICR engines, particularly those from ScanSoft and Oce, have also gotten heartier--and the better the character recognition, the better the output. We know of businesses that consistently experience near 100% data accuracy. With these kinds of results in just a few short years, I'm excited to think about the things technology will afford us in the near future!

In recent years, a stable OCR/ICR environment has provided unique opportunities to expand the way the technology benefits business. Previously, standard data capture was dependent upon a defined template that required data fields to remain in the same location from form to form--a technology known as structured document processing. Within the past few years, a significant expansion of this technology prompted the advent of unstructured (semi-structured) document processing--a method of extracting critical data found on inconsistent locations of the same form type.

This technology gives our industry incredible opportunities to address the specific pains felt by the vertical markets they support--such as insurance, mortgages, healthcare, or the accounts payable department of virtually any organization. Each of these, and countless others, has critical data located on complex forms that standard, template-based forms processing tools do not handle very well. Keywords, not templates, are used to locate and extract the required data on each unstructured form type, regardless of where it may be found on the form.

In fact, our friend from the conference may not realize that OCR-based technology is available to tackle the very problems those in the accounts payable field face each day. Unstructured forms processing can automatically capture the critical invoice data, such as the invoice date, amount due, terms, purchase order number and even detail line items, that businesses need entered into their A/P systems.

It's also a very intelligent means of processing. By incorporating "fuzzy" logic into the equation, the technology seeks variances of the keywords found on the form type, such as "P.O. Number" and "PO #" for purchase order number data. Also, the more frequently a form type is processed, the more the technology "learns" where to find the data on the page and subsequently becomes faster in doing so. But the ability to do so, with precision, has happened only in the recent past.

That's not to say that unstructured forms processing itself is that new. Actually, it's been nearly a decade since the technology first emerged--albeit prematurely, perhaps. At that time, the systems supporting the technology were too costly and the results were sketchy at best. Understandably, organizations soon became skeptical that the technology had anything to offer them at all. Perhaps that unfortunate history and similar events prompted the remark we received.

Fortunately, the landscape has changed--and we need to proclaim that loud and clear. Particularly so for unstructured processing, because even some true believers in OCR doubt the technology has merit or staying power. But our experience has proven otherwise--we recently implemented our 41st successful unstructured processing solution. Additionally, we feel the market will gradually veer to unstructured processing solutions--the more businesses realize the pliability of the technology, the more they will seek ways to customize it to their way of doing business.

Distributed Capture: Re-centralizing the Decentralized Office

Perhaps the most versatile development from our industry in recent years has been distributed capture. It affords organizations with offices across the country or around the world the freedom they've long sought to freely share their data across the enterprise. Paper forms are scanned locally, then the images get transmitted securely to the company's headquarters, where the data gets captured. Operators then verify and release this data into a backend system, where it becomes freely available within the organization for query and use.

A distributed capture solution affords multi-office organizations the freedom to select the best means for them to distribute the workflow. With workgroup or departmental scanners (that now can process 20 to 40 ppm), a broadband Internet connection and an OCR-based data and document capture solution that allows both local and remote capture, varying phases of the distributed capture process can be allocated to locations based on the data origination point and company need.

Perhaps the cycle begins with paper documents being scanned from branch offices worldwide. An OCR-based solution housed on servers in corporate headquarters then performs quality assurance on the freshly scanned document images. The images are processed and the data gets captured from them. Verifiers in another branch office then review the output data for any questionable characters, make corrections, and release the data to the backend system also at corporate headquarters, where the data becomes available for use. Distributed capture makes possible this or any other variable workflow process suitable to a client's needs.

While distributed capture certainly offers a convenient way to route data throughout the enterprise, more importantly it provides a highly cost-effective and secure means to do it as well. By distributing documents electronically, companies can save thousands of dollars annually in shipping costs, since there's no longer a need to mail documents from one office to another. The paper documents stay in their office of origin as their data and images are disbursed throughout the organization. Since the documents stay put, there is little concern for them being lost or stolen in transit. And with encryption of data over an Internet connection, security is enhanced as the electronic data gets routed through the capture process.

The odd thing about distributed capture is the way it seems to have changed the organizational dynamic. Many companies with a large national or global presence have a decentralized control of their data, since each branch or regional office maintains a hold on how data within the location gets disbursed--partially due to control issues or perhaps even disorganization.

However, with the development of the distributed capture environment in the past few years, this has begun to change. A methodically performed distributed capture solution can help to re-centralize the control of data for the entire enterprise back into the hands of the corporate and/or IT structures. What was once a fractured channel of data can once again be united for the company's common good.

In Summary

I believe it is important for us to remember just how far our industry has come in just a few short years, and I think it is equally as important that we bring all of this to the table when approaching our prospective clients. We need to understand that many of them may not understand what we do, how well it works or why our solutions will make an enormous impact on their day-to-day workflow and yes, on their bottom line.

I truly believe our industry needs to educate the market on the multiple uses for a forms processing solution: efficiency improvement, cost effectiveness and compliance (think Sarbanes-Oxley, among others). And perhaps we need to expand our audience, as well. Perhaps we should reach out to the small- and medium-sized markets to ensure they too can benefit from a stable forms processing solution the way several organizations in larger markets already do.

Once we do, we'll see a vast improvement over the current 15% of qualified businesses taking advantage of a document and data capturing solution. I also believe that once we do, our friend at the recent conference will leave us a very different comment:

"OCR? Can't live without it!"

Source: KM World

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HERAE Launches Paperless Payment Processing for Healthcare Industry; First commercial offerings expected to save billions for payers and providers

July 25, 2005 - HERAE, LLC, a new business process management and Web services provider for the healthcare industry, today announced the introduction of paperless processing of electronic remittance advice for healthcare providers and health plan payers.

In a clearinghouse fashion, HERAE (pronounced "hurray") moves information associated with healthcare claim payments from insurance companies to physician offices, electronically. The result is simpler and faster processing, the elimination of paper envelopes, checks and explanation of benefit (EOB) forms, and an expected overall savings of billions of dollars per year for the healthcare industry.

Claim payment processing is one of the most time-consuming and expensive aspects of provider staff functions. HERAE's research identifies the average cost to a physician's office for traditional processing of each payment envelope at $9.20. This means physician offices spend upwards of $5.5 billion a year to manually process claim payments. In addition, at an average cost of $0.42 per envelope, payers spend another $252 million a year to issue the payments by mail. HERAE's electronic processing solutions are expected to reduce operation and transaction costs for providers by as much as two-thirds and for healthcare payers by as much as 50 percent.

According to Joanne Galimi, a research director at Gartner Inc., business process management (BPM) is a serious need in the healthcare industry. "Business processes are coming under intense scrutiny by healthcare organizations because they are in the critical path of progressive business change," said Galimi. "BPM is the next management engineering approach to help derive explicit value from human capital. By automating repetitive tasks, users are able to spend a higher percentage of their workday on more complex, value-added tasks that require specialized skills and knowledge."

HERAE software was designed after extensive research and focus-group interaction with both providers and payers. Initial practice sites, totaling more than 500 practitioners, have been working with HERAE for several months and have assisted in the testing and refinement of the products. HERAE's offerings are all thin client, ASP-based, requiring the customer to have nothing more than a browser and HERAE's proprietary browser tiling software, ViewPoint, on their local PC.

HERAE's patent-pending process provides tools that enhance the familiar workflow activities of its provider clients and health plan customers. "Through a dedicated focus on healthcare billing challenges and electronic remittance advice, we developed products that give HERAE a distinct advantage over the offerings of others in the market space," said John Fessler, CEO of HERAE. "Rather than change the way people are used to accomplishing these tasks, we talked to them, automated the familiar, and made it so easy to learn the electronic process that providers' staff members are welcoming the automation. The time savings are obvious and will result in allowing people to focus on higher-value activities and better patient care."

The consistent paperless process connects the HIPAA 835 transaction into standardized virtual remittance forms, provides automatic re-association of claims and payments, and offers direct deposit capabilities. This process improves collections, reduces costs by up to two-thirds, and completes the payment posting and deposit cycle in a fraction of the time it takes using traditional paper, manual payment processes. The HERAE paperless process is fully HIPAA-compliant, meeting requirements of the HIPAA Privacy and Security Final Rules.

HERAE's offerings are independent of a provider's existing practice management or billing software. Provider offices that can upload an electronic remittance directly into their practice management system are supported with HERAE's unique Web presentation tool to handle exceptions that don't process automatically. The same tool gives providers robust reporting capabilities and streamlines the processing of payment exceptions, payment appeals, refunds and coordination of benefits.

About HERAE, LLC

A privately owned limited liability corporation based in San Diego, California, HERAE was founded in August 2004 to provide painless payment processing and direct deposit services for the healthcare industry. HERAE has developed patent-pending paperless processes and online tools that enable healthcare practices to electronically post payments, work exceptions, process refunds or secondary insurance, and search for and retrieve EOBs, then store the data in a database called the Electronic File Cabinet(TM). For more information, visit the company's Web site at www.herae.com.

Source: Business Wire

Fiserv Signs Definitive Agreement to Acquire BillMatrix Corp., Provider of Expedited Electronic Bill Payment Services

July 27, 2005 - Fiserv, Inc. (Nasdaq:FISV) announced today that it signed a definitive agreement to acquire BillMatrix Corp., a provider of expedited electronic bill payment services, adding a fast-growing niche to its already significant payments business. BillMatrix is expected to generate revenue of approximately $90 million in 2006. The purchase price is approximately $350 million, and the transaction is expected to close in the third quarter. The transaction is expected to be neutral to earnings in 2005 and slightly accretive to earnings in 2006.
Leslie M. Muma, Fiserv president and chief executive officer, said the acquisition of BillMatrix will enable Fiserv to expand its capabilities in electronic bill payment.

"It's no secret that Americans are increasingly using the Internet and the telephone to electronically pay their bills," Muma said. "The acquisition of BillMatrix gives Fiserv a significant foothold in electronic bill payment technologies to enhance our extensive payments capabilities." BillMatrix, founded in 1994, provides billers with an outsourced payment solution that allows their customers to get immediate credit for bills paid online or over the phone using electronic checks, debit cards or credit cards. The company's more than 120 clients include utilities, telecommunications providers, insurance companies and lenders.
Electronic transactions made up 36 percent of the estimated 17.7 billion consumer bill payments initiated in the U.S. in 2004 compared with 23 percent of total bill payments in 2001, according to Celent Communications. The share of electronic transactions is expected to increase to 56 percent of total bill payments by 2007, which is approximately a 16 percent compound annual growth rate from 2004.

Pat Foy, president of the Fiserv Bank Servicing and Electronic Payments Group, said Fiserv is seeing strong demand from its financial institution client base for electronic bill-pay solutions.
"There is considerable opportunity for BillMatrix to expand on its current client base, and we believe we can leverage the company's success in the biller-direct market to offer more options to our clients," Foy said. "Financial institutions can also use BillMatrix's services for their own expedited payment needs and to resell the company's services to their corporate customers."

BillMatrix's employees and its president and chief executive officer, Scott B. Walker, will join Fiserv after the acquisition is completed. BillMatrix is based in Dallas. The majority of the company's stock is owned by Great Hill Partners, a Boston private equity firm, and other outside investors, while the remainder is owned by management and employees.
Walker said the acquisition by Fiserv will enable BillMatrix to continue its track record of strong growth. "This is a very exciting time in the history of BillMatrix because we are joining with a company that not only understands payments, but also values the entrepreneurial spirit that is so much a part of our company," Walker said. "Through Fiserv, we will have access to capital and other resources that we can use to improve our current offerings to clients and to pursue additional growth and new market opportunities."

Fiserv has a comprehensive payments business that includes processing of debit/ATM transactions, credit cards, checks, currency and lockbox, as well as cash management products and services, Internet bill payment and presentment, plastic card production, statement mailing and automated clearinghouse (ACH) solutions.
BillMatrix was advised on the transaction by the investment banking firm of Lane, Berry & Co.

Founded in 1994, BillMatrix Corp. provides outsourced, high-tech alternatives to traditional payment methods using the latest automated interface technologies. BillMatrix works with more than 120 companies to supplement paper-based methods of remittance with convenient, efficient and cost-effective electronic payments. Consumers, customer service representatives and other third-party agents are able to make payments via hosted Internet and telephone systems using credit cards, ATM/debit cards and electronic check payment options. For more information, visit www.BillMatrix.com.

Fiserv, Inc. (Nasdaq: FISV) provides information management systems and services to the financial and health benefits industries, including transaction processing, outsourcing, business process outsourcing and software and systems solutions. The company serves more than 16,000 clients worldwide, including banks, credit unions, financial planners/investment advisers, insurance companies and agents, self-insured employers, lenders and savings institutions. Headquartered in Brookfield, Wis., Fiserv reported $3.4 billion in processing and services revenues for 2004. Fiserv was ranked the largest provider of information technology services to the U.S. financial services industry in the 2004 FinTech 100 survey by the American Banker newspaper and the Financial Insights research firm. Fiserv can be found on the Internet at www.fiserv.com.

The disclosure set forth above contains forward-looking statements, specifically statements regarding estimated revenues in 2006, expected acquisition earnings impact in 2005 and 2006, the closing date for the acquisition and the anticipated growth of the electronic bill payment industry. These statements are covered by the safe harbor included in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to inherent assumptions, risks and uncertainties that may cause actual results to differ materially from those contemplated by such forward-looking statements. The factors that may cause actual results to differ materially from those contemplated by the forward-looking statements include, among others, the demand for electronic bill payment services, pricing and other actions by competitors and delays in completing the transaction. These factors should be considered in evaluating the forward-looking statements and undue reliance should not be placed on such statements.

 Source: [Fiserv]

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BasWare to acquire the travel management company Trivet Software

August 12, 2005 - BasWare Corporation has agreed on acquiring the Finnish Trivet Software Oy that develops software solutions for electronic travel expense management. The acquisition price for the entire shareholding of Trivet Software is approximately EUR 0.9 million of which EUR 0.45 will be paid in cash and the remainder through a share exchange. The exchange requires a directed share offering to the shareholders of Trivet Software. The agreement has an earn-out of a maximum of EUR 0.45 million, to be paid latest in February 2007, which is dependant on Trivet Software’s product sales following the acquisition. The acquisition is expected to increase BasWare’s net sales in 2005 with approximately EUR 0.5 million.

Trivet Software specializes in electronic travel management. Its Voyager software solution has approximately 50 000 users in over 150 organizations in Finland and Scandinavia. The solution has been localized in the most significant European countries and its largest international customers include ABB Service, Eli Lilly and Fortum, among others. The net sales of Trivet Software in the financial year ending March 31, 2005 was approximately EUR 0.8 million and operating profit 20.5% of net sales. The company is owned by the management that will continue working for the company. Trivet Software has altogether 10 employees located in Pori, Finland. Outside Finland the company has operated through a country specific partner network.

BasWare aims to integrate the travel management solutions achieved in the Trivet Software and Iocore acquisitions as part of the BasWare Enterprise Purchase to Pay product portfolio. AMR Research (2002) has estimated the travel and expense management market size to be over USD 700 million globally.

“Trivet Software’s travel management solution complements BasWare’s product portfolio very well and opens ups a significant new market potential for us,“ says Hannu Vaajoensuu, BasWare’s Chairman of the Board. “BasWare can offer the versatile product an international distribution channel that Trivet Software has so far been lacking and thus multiply the sales of the product. In the coming year the acquisition will support our growth targets, especially in the Nordic countries and Central Europe. Later, when this product and the travel solution we have in the Norwegian market, have been integrated in BasWare’s product portfolio, we can make the most out of the growth potential in the whole distribution channel.”

Of the estimated total acquisition price, EUR 0.62 million will be, based on a preliminary estimation, allocated to intangible assets in respect of customer relationships and products including deferred tax liabilities. EUR 0.48 million will be recorded as goodwill. The aim is to merge Trivet Software in the parent company of BasWare Group by early 2006.

Source: BasWare

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