Operations research in the management of the airlines

This paper is intended to present an introduction to the use of operations research in the international airline industry, and to demonstrate the scope and significance of the airline OR activities. First, the special reasons for the viability and spread of airline OR are discussed. Then a functional framework for an airline is outlined, to be used in analyzing the problems of an airline and relating the OR work to it. Four major applications are described, corresponding to four major components of the framework. These applications are: schedule development, overbooking control, crew scheduling and engine management, respectively. In each case we describe the problem and its significance, indicate the types of solution techniques which have been developed, and assess the implemented solutions. The paper concludes with comments on the current state-of-the-art and the future of airline OR. A detailed bibliography is given. Both of the authors have been operations research directors in major airlines and more recently have focused their attention upon the industry as academic researchers. This background has provided us with an unusual opportunity to analyze the role of OR in the airlines, and our paper seeks to share with the reader some of the insights we have gained thereby.