Straight-through processing (STP) is the completion of a transaction from start to finish with no manual intervention at any stage. The term comes from financial services, where it described a securities trade settling without anyone rekeying it between systems, and it has since been adopted across any industry that moves documents between systems at volume.
In distribution, an order processed straight through is captured, validated, created in the ERP and confirmed to the customer without a person touching it.
STP and touchless order processing
The two terms describe the same outcome and are often used interchangeably. The difference is mostly one of scope and origin.
| Straight-through processing | Touchless order processing | |
|---|---|---|
| Origin | Financial services | Distribution and manufacturing |
| Applies to | Any transaction type: orders, invoices, payments, claims | Orders specifically |
| Usually measured as | STP rate across a transaction class | Touchless rate on inbound orders |
If you are talking about orders alone, either term works. If you are talking about orders, supplier invoices and remittances together, STP is the term that covers all three.
Where STP applies in distribution
- Inbound sales orders: customer order to ERP sales order
- Purchase orders to suppliers: replenishment raised and sent without manual keying
- Supplier invoices: matched to PO and receipt, then posted without review
- Customer invoices: raised from the confirmed order automatically
- Remittances and cash application: payments matched to invoices without a person
Many distributors have high STP on outbound documents they control and low STP on inbound documents other people send them, because inbound arrives in whatever format the sender chose.
How STP rate is calculated
The usual formula is the number of transactions completed with no manual step, divided by total transactions, over a period.
The definition of “no manual step” is where comparisons fall apart. Some measure excludes a rep clicking approve. Others count a transaction as straight-through if it reached the ERP automatically, even though someone resolved an exception on the way. When a vendor quotes an STP rate, the useful question is what they counted.
What raises the STP rate
Clean reference data. Item codes, pack sizes, customer mappings and prices have to be right, because every downstream step depends on them.
Format independence. A system that only reads layouts it has been configured for will never process the unpredictable ones straight through.
Automated exception resolution. Detecting a problem automatically is not STP if a person then has to fix it.
Real-time validation. Checking against live ERP data instead of an overnight copy avoids false exceptions. How that connection works in practice is covered in this guide to ERP order processing.
Removing habitual approvals. Some manual steps survive because nobody has questioned them since the process was designed.
STP is a means, not a target
A high STP rate achieved by loosening validation is not a gain. Orders flow faster and errors flow with them. The measure worth tracking alongside STP is the accuracy of what was processed, because the two can move in opposite directions.
How Ordana helps
Ordana is built to process orders straight through including the awkward ones. The Ordana Desk Agent reads orders in any format with no templates to configure, validates each line against live catalog, pricing and inventory data, and writes the finished sales order into the ERP.
The step that usually breaks STP is the exception, and this is where the agent differs from extraction-led tools. Rather than routing a stock shortage or a price mismatch to a person, it contacts the retailer, agrees the fix and completes the order. Channels that are normally excluded from STP programmes, such as phone orders, are handled by the Ordana Voice Agent and flow into the same process. Ordana reports up to an 80% reduction in order processing labour for its customers.
Schedule a demo to see what share of your orders can run straight through.
Frequently asked questions
What does STP stand for?
Straight-through processing, meaning a transaction completed with no manual intervention.
Is STP the same as automation?
Not quite. Automation can speed up individual steps. STP means no step in the chain needs a person.
What is a realistic STP rate for sales orders?
It depends on your channel mix and how the rate is defined. Ask any vendor quoting a figure what they counted as manual.
Can STP apply to invoices as well as orders?
Yes. STP is measured across many transaction types, including supplier invoices and cash application.
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