Cutting-edge technology with the human touch

April 2, 2019

Fairstone has forged a reputation for astute financial planning and outstanding customer service. Simon Rushworth discovers how the Tyneside-headquartered wealth management firm fuses old school values with cutting-edge technology to future-proof its clients’ investments

In 2019, Fairstone looks set to maintain its position as one of the UK’s largest chartered financial planning firms – complementing industry-leading expertise and a nationwide presence with efficient practice to underpin a genuine success story that is rooted in the North East.

Its busy and welcoming Boldon headquarters, expanding workforce, headline-grabbing acquisitions and impressive industry ratings create a base level of confidence where new and existing clients are concerned. Within the firm there is a keen sense of achievement and ambition from the office floor through to the boardroom.

But 11 years on from inception, it’s beneath the surface, behind the scenes and in the background where Fairstone has stolen a march on competitors still coming to terms with a landscape dominated by rapid technological advances and looming cyber threats.

“Fairstone is a full-service wealth management house that delivers intelligent solutions to clients across a lifetime financial journey. Our core investment portfolios have been defaqto fivestar rated for four consecutive years and we’ve got the highest Trustpilot rating of any wealth management firm,” explains proud founder and CEO Lee Hartley. “And we deliver all of that – a fully joined up, whole of market service – at a 60 per cent lower cost than the market leader.

“Technology is a big driver of that. It drives efficiencies, reduces costs and ensures that centralised staffing support research is connected to a distributed team of financial planners, without the need for unnecessary costs.

“But technology is also about trust. Improving cyber security and reducing cyber risks are number one on our agenda. Pinsent Masons carried out some research that suggested only two per cent of financial services businesses have invested adequately, in terms of time and money, in cyber security. I firmly believe we sit inside that two per cent.”

That position of strength is due, in part, to the valued contribution of former Sage analyst Michael Hall.

Fairstone’s IT director is responsible for delivering the firm’s proprietary marketing, back-office and technology platform and is a big believer in embracing business intelligence (BI) and artificial intelligence (AI) systems, to ensure Fairstone remains at the forefront of the financial planning sector.

That belief manifested itself in the decision to launch a ground-breaking BI project aimed at better understanding the firm’s valued customer base, with particular focus on retirees and the need to constantly reassess their unique financial needs.

“We took the decision to implement a BI solution with extended AI capability,” explains Michael. “Effectively that allows us to make much better decisions within our business and make those decisions quickly. We are now far better informed and we can pass that knowledge on to our customers.

“In addition, we are implementing next generation cyber defence solutions that use AI. Those solutions allow us to scan the whole network and look at the behaviour of that network through machine learning. The solution can detect anomalies and alert us to those anomalies. Using extended AI capability, it can also fix some of those problems.

“Of course, there’s been a lot of press around BI improving customer experiences through check boxes and robot advice. But that’s not part of our thinking at Fairstone.”

“Not at all,” adds Lee. “We pride ourselves on being at the forefront of BI and AI solutions but if you look at the complexity of real financial planning and real wealth management, then it is all about human interaction. For us, AI sits in the back office but front of house we are all about face-to-face communication with our valued customers, and that will never change.

“A fundamental difference between ourselves and some of our peers is that it’s not tech for tech’s sake at Fairstone. It’s tech – and the right type of tech – that delivers a client benefit.

“It all has to work towards creating a better outcome for clients. And that viewpoint does inform what you do and how you do it. Ultimately, what we want to do is have a tech platform and have a tech strategy that makes the customer experience better, not worse.

“And that’s a difficult thing to do. Striking that balance is an art form in itself. And it does need a collegiate approach to the strategy.”

Lee’s approach has always been customer focused. It was a frustration with the financial industry’s failure to recognise its inherent inefficiencies which persuaded the former e-commerce and software development specialist to found Fairstone. And more than a decade down the line that brave decision is paying dividends – for its CEO, Fairstone’s 51,000 clients nationwide and the North East business community.

“I worked with a lot of building societies, small banks and life insurance and investment houses and during a four to five-year period, I really started to learn where the inefficiencies were,” he adds. “And I could also see that a lack of customer focus lay within those organisations.

“There were some really obvious gaps. Firstly, a lot of those organisations were built to support the fee earners, rather than built to support the clients, which, in my mind, was quite fundamental.

“Secondly, many clients were being charged inflated fees because of inefficient back office setups, people costs and premises costs.

“I thought that if you could tackle those issues and make something that’s really built around the client, then it would be possible to create a proposition that is more modern and more what the regulator wants to see. That became Fairstone.”

Early adopters of influential technology, Lee and Michael share a common desire to keep their firm at the forefront of BI and AI innovation. Two years ago, Fairstone moved to the cloud and, in tandem, replaced their entire IT suite to accommodate a top-level encryption programme. “Cyber security is its own business function,” added Lee. “In the last three years we have invested £2.5m to bolster our cyber security.”

Michael concludes: “Ultimately, what our clients want to know is that the diligence with which we manage their money is the same diligence that we apply to managing their data. Our job now is about more than simply managing money; it’s about managing digital assets too.”


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