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Airline efficiency with optimal employee allocation: An Input-shared Network Range Adjusted Measure

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  • Li, Ye
  • Cui, Qiang

Abstract

Airline's departments can be divided into three stages based on their roles: Operations, Services and Sales. Some inputs are shared among these stages such as employees. However, different airlines have different employee allocation proportion among the three stages, and it is important for the airlines to realize the optimal allocation proportions in the pursuit of high airline efficiency. Focusing on this problem, we propose an Input-shared Network Range Adjusted Measure model to calculate the efficiencies of 29 airlines from 2008 to 2015. The main findings are: 1. With the shared input, airline efficiency has a large improvement against that without shared input. 2. Eva Air has the highest overall efficiency among these 29 airlines. 3. Most airlines' average efficiencies in Operations and Services are larger than Sales. 4. Different airlines' employee optimal allocation proportions have a large difference and most airlines' largest allocation proportions should be in Sales. 5. It is reasonable to set average stage weights for the three stage.

Suggested Citation

  • Li, Ye & Cui, Qiang, 2018. "Airline efficiency with optimal employee allocation: An Input-shared Network Range Adjusted Measure," Journal of Air Transport Management, Elsevier, vol. 73(C), pages 150-162.
    • Handle: RePEc:eee:jaitra:v:73:y:2018:i:c:p:150-162
    DOI: 10.1016/j.jairtraman.2018.09.002
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