I was talking with a mathematician and programmer friend over the weekend about the advantages of Straight Through Processing (STP).

He described it as an initiative used by companies in the financial world to optimise the speed at which transactions are processed. This is performed by allowing information that has been electronically entered to be transfered from one party to another in the settlement process without manually re-entering the same pieces of information repeatedly over the entire sequence of events.

The purpose of STP is to create efficiencies, eliminate mistakes, and reduce costs having machines process trades instead of people. As technology has improved, and as financial services companies struggle to reduce costs, the popularity of STPs has increased substantially.

He then went on to list the benefits as follows:

• Greater visibility, transparency and consistency of processes
• Higher efficiency of processes through standardization and replication
• Improved quality of processes through implementation of proven methodologies and best practices
• Improved ability to track and manage processes
• Redeployment of individuals into income generative roles
• Enhanced customer service
• Redirection of cost savings to business-building strategic initiatives
• Competitive advantage

Sounds like a familiar concept to you? I thought so!