# Intelligent Document Processing (IDP)

> Intelligent document processing (IDP) is the automated capture, classification and extraction of data from documents such as invoices, contracts, forms, bills of lading and medical records. It combines OCR or vision models with AI that understands layout and meaning, then validates extracted fields against business rules and sends uncertain items to a person for review.

## Why it matters for your business

Documents are where much manual data entry hides, especially in finance, insurance, logistics, legal and healthcare. Template-based extraction tools break whenever a new vendor or layout appears. AI-based IDP handles variation far better, but no system is perfect, so the design must include confidence thresholds, validation against source systems, such as matching a PO number, and a review queue. The return comes from removing routine keying while keeping a person on the exceptions, not from eliminating review entirely.

## Example

A construction subcontractor receives supplier invoices in dozens of formats. An IDP workflow classifies each document, extracts supplier, invoice number, line items and totals, and matches the invoice to its purchase order and job number. Invoices that match within tolerance go to the project manager for one-click approval. Mismatches go to accounting with the discrepancy highlighted.

Related terms: https://www.lumeor.studio/glossary/ocr-optical-character-recognition/, https://www.lumeor.studio/glossary/structured-outputs/, https://www.lumeor.studio/glossary/human-in-the-loop/, https://www.lumeor.studio/glossary/business-process-automation/, https://www.lumeor.studio/glossary/rpa-robotic-process-automation/

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Source: https://www.lumeor.studio/glossary/intelligent-document-processing/