I do some transcribing at the National Archives (US) website. They use some automated system, I don't know the details of it, but the results vary quite a bit depending on the writing. I'm looking specifically at 1870's US documents. Some pages it's about 80-90% accurate, other pages maybe 20%.
It only looks at the words individually, it doesn't try to make sense of the whole page or whole set of pages together. Like if a person's name is clear in one spot and hard to read in another, it won't cross-reference the name. It also doesn't try to narrow down word choices based on the topic of the page.