Charles and Keith Operations Management

The report discusses the Charles and Keith organization based out of Singapore. This footwear company was established in 1996 by two brothers. Since then it has grown worldwide because of its efficient operations and market understanding capability. Following report discusses the company’s operation management techniques, analyze the global business environment for fashion industry and looks at the environmental issues in operations management. The report also encloses recommendation and conclusion section.

Running Head: OPERATIONS MANAGEMENT
Charles and Keith Operations Management
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OPERATIONS MANAGEMENT
Executive Summary
The report discusses the Charles and Keith organization based out of
Singapore. This footwear company was established in 1996 by two brothers. Since
then it has grown worldwide because of its efficient operations and market
understanding capability. Following report discusses the company’s operation
management techniques, analyze the global business environment for fashion industry
and looks at the environmental issues in operations management. The report also
encloses recommendation and conclusion section.

OPERATIONS MANAGEMENT
Contents
Introduction..................................................................................................................4
Implementation of Operational trends.......................................................................5
Just in Time:.............................................................................................................5
Total Quality Management:....................................................................................5
Reengineering...........................................................................................................6
Flexibility..................................................................................................................6
Time Based Competition.........................................................................................7
Supply Chain Management:....................................................................................7
Analysis of Global Market Place:...............................................................................8
Environment Issues in Operations Management:.....................................................8
Competition..................................................................................................................9
Recommendations........................................................................................................9
Conclusion...................................................................................................................10
References...................................................................................................................11

OPERATIONS MANAGEMENT
Introduction
A Singapore brand named as Charles and Keith is famous for its footwear and its
accessories. The company was established in 1996. The two brothers Charles Wong and Keith
Wong started this company. It started as Women shoe store but now had grown into international
chain. It has more than 300 outlets. The company has also achieved significant number of
awards. Considering the background of company, the two brothers learned the way of managing
the shoe business by supporting their parents at their store. Earlier it was wholesale way of
selling the shoes. The two brothers wanted to make use of new model of business and so they
opened their own label in Amara Shopping Centre, Singapore. They could see the
unsustainability of selling shoes bought from wholesalers. It lacked the design and variety of
options (Monczka & Patterson, 2015). The company make sure that their products are sold in the
affordable range. The business is also made cost efficient by directly buying from manufacturers.
The exclusivity is maintained by ensuring that manufacturers are not selling shoes to the other
retailers. Promotions are done through photoshoots and using social media websites like
Facebook. Charles and Keith also have introduced footwear for men section called Pedro.
However, Pedro has become unisex.

OPERATIONS MANAGEMENT
Implementation of Operational trends
Just in Time:
Just in Time or JIT methodology mainly focuses on reducing flow time during production
and response time between stakeholders (Cottam & Ranson, 2017). Charles and Keith maintain
strict timelines from manufacturing to logistics till the product reach the shelves. Every week 15-
20 new designs hit the stores. The designers and manufacturers are near i.e. in China. Instead of
buying material from wholesale in Singapore the company buys from China directly where the
products are made. Vertical Integration is implemented in the business including supply from
their own factories, delivering good quality of goods etc. They maintain speed to market which is
key to their success (Christopher, 2016).
Total Quality Management:
The company positioned themselves as high design affordable products by maintain
decent quality. However, to penetrate the market, the company has also introduced Signature
Level. The new collection represents high quality and more expensive shoes. Due to its growing
reputation of high quality women and men collection, the international partners are joining hands
with the company. Also, vertical integration where the owners focus on everything from
suppliers to franchise partners. This assures reasonable quality level (Serban, 2015). They also
maintain attractive shop ambience and display which provides a significance proof to quality.
The brand is located mainly in urban and suburban mall where other high-quality brands are
placed. Also, the investment of private equity arm of Louis Vuitton (L capital Asia) in Charles
and Keith made its retailing business more successful. The franchise partners are selected who
are passionate and who try to maintain the positioning of the brand.

OPERATIONS MANAGEMENT
Reengineering
Reengineering is way by which business process are re-thinked and re-designed to see
improvement in measure such as cost, service, speed and quality. While helping their parents, the
owners realized that selling shoes which are brought from the customers is not a good way to go
to market. The customers feedback must be considered by suppliers (Chang, 2016). The
customers must be provided with the design they wanted. Also, this new approach should not
build high prices. The brothers devised strategy for designing shoes, stocking inventory, making
entry to cash register. Also, the company has entered into e-commerce business so that it can
reach to the markets where it still lacks brick and mortar shops.
Flexibility
In addition to shoes, the company also provides women bag and accessories. So, the
company is widening its product range with new products. The entire supply chain is designed in
a way that consumer market is researched fast and the products as per requirement are put on
shelves faster. Also, the company is acting as its own biggest competitor. Pedro is one of the
famous shoe store owned by Charles and Keith. It begins as an option for males but later own
started creating female shoes as well. This may cannibalize their own chain of Charles and
Keith’s. But the company is easy to adapt the growing market requirement. It invests a lot in
understanding different markets and provide the required output. Also, LMVH took about 20%
stake in the company. Initially owners were hesitating to bring investors onboard but later took
this step for the betterment of company. During Asian Economic Crisis (1997), when most of the
Singaporean firms were suffering, Charles and Keith see this an opportunity to work with
factories and gain control over production process.

OPERATIONS MANAGEMENT
Time Based Competition
This concept stresses on the fact that time is considered as resource and the organization
which values it can take a competitive edge (Suri, 2016). The company is pioneer in focusing on
this concept. At the right time it could understand that wholesale purchased products would not
give them edge, so they opened their outlet way back in 1966. The company knows that even in
inflation a Singaporean female shop for shoe every month. So, the main prerequisite for their
target market is design so the company maintains standard of designers. They make sure that
designers are well informed of coming trends. The company spends around 3% of their revenue
in training the designers. Moreover, the company considers its overseas expansion seriously. It
entered into different markets after doing proper retail and cultural research over there (Roll,
2015). The company has also sold its 20% stake to LMVH to enter China and United States.
Supply Chain Management:
This company has maintained strong relationship with its suppliers, business partners and
customers. This is the first step they follow. They listen to the needs and build their service
accordingly. The business is following vertical integration which starts from its own factories.
The company mostly does retailing in shopping centers and prominent places that are easy to
access. For example, when it opened first store in Japan, it strategically decides the main fashion
district. Wherever its retailing outlet was not present it decided to choose online channels i.e. e-
commerce. The proximity between supplier, designer and manufacturer is kept which helps in
decreasing the lead time. The manufacturing operations are mainly taken place in China which
decreases the overall cost. From these two owners, one is dedicatedly focused on operation
activities and other is on Sales.

OPERATIONS MANAGEMENT
Analysis of Global Market Place:
Fashion is fast paced. One of the important criteria for this is adaptability (Page, 2015).
Problem solving ability is needed to reinvent and for continuous improvement. The excellence is
strived at every step. The fashion products should have design, variety and have reasonable
pricing. The prices must be competitive. Many of the big brands enter designing their own
product based on the customers’ feedback. The customers expect new products at every season.
Companies need to take proactive measures such as competing with themselves by bringing new
brands or new products on shelve. Companies create different brands and segregate them to cater
different target market (Pedersen & Hvass, 2018). The market research and fashion shows give
significant ideas in business development (Walker & Klassen, 2014). In order to have success on
National and International Front, firm grip is needed in operations across its network. Fashion
brands are committed to provide sophisticated and high-quality products that are in synch with
the trend. The strong social media presence is must. The leads are created using e-commerce
sites. Also, the brick and mortar stores are located at accessible locations.
Environment Issues in Operations Management:
The fashion industry has been subjected to many environmental issue in the recent time.
The notion of discarding the old and keeping the new is given prime importance (Turker &
Altuntas, 2014). Various environmental issues include poor working conditions, low quality
products and their planned obsolescence. Another issue is disposal of textile waste. Fashion
Industry has large amount of backlash for their carelessness towards environment. The low-
quality products are offered at low prices is the important aspect to be considered. Mostly

OPERATIONS MANAGEMENT
companies are interested to increase their product line without considering any of the criteria like
Sweat Shop etc. Many mass market retailers have started considered eco-friendly fabric like
Organic Fabric in order to be social responsible. Many measures have been implemented to put a
check on the social issues. The stakeholder analysis and life cycle assessments are done to
become non-compliant for the environmental issues.
Competition
Zara, H&M and Forever 21 are performing well but they are not able to cater mass
market for shoes like the way Charles and Keith’s have catered. Some brands are dedicated but
they could not maintain the affordable price for the customers (Oakland, 2014). So, this makes
the brand competitive with its high design and variety of products at affordable price with good
quality (Goetsch & Davis, 2014). The company is following both cost leadership and
differentiation strategy to cater mass market. It understands the customer needs and fulfil it
through its own designed and manufactured products. All its processes and operations are
properly designed and well managed. The company considers all the opportunities like selling of
stakes to LVHM.
Recommendations
Charles and Keith have exceptionally done well since their inception. From creating their
own design to expand themselves globally they have outpaced many brands. For the betterment
of the organization they have accepted offer from LVMH. However, the company needs to
maintain its vision in the long run. Despite joining hands with private equity, they also aim for
IPO in the longer run. But this may impact the exclusivity of the company. Many people on the
board may have different agenda so keeping the same pace as it has today must be taken care of.

OPERATIONS MANAGEMENT
In addition to this, the company states that it maintains decent quality for the products other than
Signature Level. So, this quality should be enhanced. Also, it may also bring option for co-
customization where customers can design their products themselves using a platform. There are
some franchise partners like “Owners” of Japan who lack retail skills. So, these partnerships
must be evaluated properly before entering into the market. Charles and Keith have recently
entered e-commerce. So various options like Artificial Intelligence, Machine Learning could be
incorporated to attract and retain customers. Robotic Process Automation can be used to reduce
unnecessary work (Lehmann, 2016).
Conclusion
Charles and Keith is Singaporean Multi National Company. The company is famous for
its high design affordable products. The company has done vertical integration to create a niche
in the market. The company is worldwide recognized. The credit goes to its owners’ capability of
managing the operations and adapt the competitive market. The owners have learnt from their
own setbacks. For the longer run, the owners’ have taken decision of selling stake to LVMH.
This will increase their visibility to the market and strengthen their brand. The company is
creating a big space in the ecommerce as well. The company is very selective in choosing
business partners.

OPERATIONS MANAGEMENT
References
Chang, J. F. (2016). Business process management systems: strategy and implementation.
Auerbach Publications.
Christopher, M. (2016). Logistics & supply chain management. Pearson UK.
Cottam, R., & Ranson, W. (2017). Just in Time. In Bridging the Gap between Life and
Physics (pp. 57-74). Springer, Cham.
Goetsch, D. L., & Davis, S. B. (2014). Quality management for organizational excellence. Upper
Saddle River, NJ: pearson.
Lehmann, C. F. (2016). Strategy and business process management: techniques for improving
execution, adaptability, and consistency. Auerbach Publications.
Monczka, R. M., Handfield, R. B., Giunipero, L. C., & Patterson, J. L. (2015). Purchasing and
supply chain management. Cengage Learning.
Oakland, J. S. (2014). Total quality management and operational excellence: text with cases.
Routledge.
Page, S. (2015). The power of business process improvement: 10 simple steps to increase
effectiveness, efficiency, and adaptability. AMACOM.
Pedersen, E. R. G., Gwozdz, W., & Hvass, K. K. (2018). Exploring the relationship between
business model innovation, corporate sustainability, and organisational values within the
fashion industry. Journal of Business Ethics, 149(2), 267-284.

OPERATIONS MANAGEMENT
Roll, M. (2015). Asian brand strategy. In Asian Brand Strategy (Revised and Updated) (pp. 107-
140). Palgrave Macmillan, London.
Serban, A. I. (2015). Managing Transformation: Business Process Reengineering or Total
Quality Management. International Journal of Academic Research in Business and Social
Sciences, 5(5), 81-86.
Suri, R. (2016). It's about time: the competitive advantage of quick response manufacturing.
Productivity Press.
Turker, D., & Altuntas, C. (2014). Sustainable supply chain management in the fast fashion
industry: An analysis of corporate reports. European Management Journal, 32(5), 837-
849.
Walker, P. H., Seuring, P. S., Sarkis, P. J., & Klassen, P. R. (2014). Sustainable operations
management: recent trends and future directions. International Journal of Operations &
Production Management, 34(5).