Evaluating airlines with slack‐based measures and meta‐frontiers

Abstract

Summary This study develops a new performance evaluation model, called the meta dynamic network slack‐based measure (MDN‐SBM). This model incorporates the concept of meta‐frontiers to facilitate comparisons of performance of decision making units, while at the same time it generalizes the slack‐based measure (SBM), network SBM, and dynamic SBM. This MDN‐SBM model is capable of dealing with two important special features of the transportation industry: unfavorable accidents and non‐storable goods, i.e. available seat‐kilometers that are wasting assets that lose value completely if unsold before departure. Hence, this generalized model contains higher differentiable capability than all its SBM‐related submodels in the literature. To demonstrate, 35 international airlines with two divisions (production and consumption) in three terms (one‐year time periods from 2007 to 2009) have been analyzed using meta‐performance efficiency measures (ME) for all decision making units and have also been compared by geographical area (Asia‐Pacific, N. America/Europe). The numerical example and comparison validate the proposed MDN‐SBM model and suggest the airlines should put more focus on input resources reduction for productivity improvement. Copyright © 2016 John Wiley & Sons, Ltd.

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