Straight-through processing: cut the touches per task

Key takeaways

Straight-through processing means an item passes from start to finish without anyone having to stop and fix, check or retype it. The share of items that do so is the straight-through rate. Raising it is one of the surest ways to cut operating cost, because the items that need manual touches consume most of a team's time.

• Straight-through rate: items completed with no manual intervention.
• Each manual touch adds minutes, delay and a chance of error.
• Clean input at the start does more than checks at the end.
• Keep people on judgement, risk and exceptions.

What is straight-through processing?

Straight-through processing (STP) is the handling of a transaction from entry to completion without manual intervention. The term comes from financial services, where it describes payments and trades that settle automatically. In a small business it applies to orders, invoices, bookings and forms that flow through without anyone correcting them.

• How BPO can help businesses reduce operational costs
• The cost of manual processes, and what to fix first

Why do touches cost so much?

Touches cost so much because each one is an interruption, not just a task. Someone has to notice the item, open it, work out what is wrong, find the missing information and restart the process. The few minutes of correction sit inside a much longer delay while the item waits its turn.

• Process handoffs: why every extra handover adds cost
• Exception handling: the few cases that drive most cost

How do you measure your straight-through rate?

Count the items that completed without any manual correction or query and divide by the total. Use a month of data. Then list why the others needed a touch. In an illustrative firm processing 500 web orders a month, 350 go straight through and 150 need attention: a 70% straight-through rate.

If a clean order takes 2 minutes of handling and a touched one takes 14, the 350 clean orders use about 12 hours and the 150 touched ones use 35. Less than a third of the orders take three-quarters of the time.

• Straight-through rate: 70%.
• Clean orders: 350 at 2 minutes, about 12 hours.
• Touched orders: 150 at 14 minutes, 35 hours.

• Cost baseline: measure today's cost before you change it
• Right first time rate: the quality number that cuts cost

How do you raise the rate?

Raise the rate by fixing input before it enters the process. Most touches come from missing or inconsistent information: an address without a postcode, an invoice without an order number, a form with a free-text field where a choice was needed. Required fields, validation and clear instructions prevent them.

• Make essential fields compulsory at the point of entry.
• Replace free text with choices where answers repeat.
• Validate formats such as postcodes and reference numbers.
• Connect systems so data is entered once.
• Set rules for auto-approval below a threshold.

• Double data entry: what rekeying costs and how to stop it
• Process standardisation: one best way, lower cost per task

Where should people stay involved?

People should stay involved wherever judgement, risk or a customer relationship is at stake: large payments, unusual orders, complaints, anything with legal weight. Full automation of those invites expensive mistakes. The aim is that people handle the cases that need a person, not that nobody handles anything.

• The four eyes principle for small businesses
• AI versus BPO: what to automate and what to staff

How does a managed team fit?

A managed team is the practical way to handle the items that do not go straight through, at a lower cost and with the reasons recorded. A good team reports each week why items needed a touch, which gives you the list of fixes that will raise the rate. Automation takes the clean cases. People take the rest.

• How to reduce back-office costs in a UK small business
• Order processing outsourcing for manufacturers and brands

What does this look like in practice?

A pattern we see in order processing: the team is busy all day and most of that time goes on a minority of orders with something missing. Adding two required fields to the order form removes a large share of them. Nobody worked faster. The work simply stopped arriving broken.

• See client work
• BPO Solutions for UK businesses

Straight-through processing checklist

Apply this to one high-volume process.

• Count items in and items touched for one month.
• Calculate the straight-through rate.
• List the top five reasons for a touch.
• Fix the input that causes the top reason.
• Set approval thresholds for low-risk items.
• Re-measure the rate monthly.

• Cost reduction KPIs: the numbers that prove savings are real
• Process cycle time: how to measure and shorten it

Next step

Tell us which process has the most items coming back for correction. We will help you measure the straight-through rate and find the input fixes that raise it.