Internal Disturbance – Our internal disturbance is mostly maintaining appropriate inventory levels. We manage our inventory through demand forecast, along with current stock and demand levels, to decide on desirable stock levels. The key point here is beeing flexible in dealing with changes in the environment into avoiding out of stock items or capital tied up capital in inventory.
If we are unable to respond appropriately to changes in the environment, the pmost enxtialreme consequence in the extreme case will be the loss of customers. This scoenceptario is embodescribed in Ashby’s lLaw of rRequisite vVariety (Ashby, 1956), which implies that in order to achieve effective control;, a control system (our inventory level) must be capable of the same level of variety as the system which it is operating.
External Disturbance – Based on our inventory and sales, our external disturbances are our competitors. In our rReactiong to our competition oin the market, we have amplified our requisite variety by establishing a distribution system that involves sales to both mass retailers and small retailers. We also amplify our variety (products) through advertisements, and customer price promotions.