It's a physical organization of raw data to turn into usable form of information. This usually can be applicable when data is collected through paper questionnaire, or postcards. From my previous experience, gathering and capturing of information are done through computer programs, then saved it all in a database. But there were those times when collection is done through paper questionnaire, tabulate them in spreadsheets, then do the necessary calculation.
I experienced this when i joined a workforce for population enumeration in our country. Eventually, all the gathered data were needed to be entered in the computer, and imagined how much time and man-hours were required if those were to be entered one-by-one. But we had a machine to read all the information from the questionnaire and transfer it to the computer through scanning. Before we could start that process, we had to make sure questionnaires were properly filled-in. This was the data validation step.
The limitations of stacks of paper, human error and the cost of man-hours meant that manual data processing could not handle the increasing demands of modern data collection.