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In this video tutorial, the presenter explains how to create an electronic signature in Microsoft Word. The process begins by taking a photo of your handwritten signature on paper using a smartphone. After transferring the image to your computer, you can open it in a photo editing program. The next step is to crop the image to focus on the signature and then save it to a dedicated folder, such as "sig." Once the image is prepared, the tutorial indicates that the background will need to be removed using features in Microsoft Word.