Application of operations research in the airline industry

The problem was to review and evaluate operations research techniques and models that had been applied in the airline industry and to discover problem areas where further research is needed. The method was to review management and operations research literature pertaining to airlines, and to formulate the thesis outline on the basis of literature consulted. More specialized literature was then sought under each of the main chapter headings: Marketing, Production, Airports, Finance. In Marketing, little was found that originated from airline companies, except in the area of forecasting. Advertising and pricing models studied were chiefly from manufacturing industries. Airline Production, the revenue-earning part of airline operation, has been extensively studied by operations researchers in the airline industry. Reservations systems, manpower planning, scheduling of aircraft and crews and passenger check-in and baggage handling were main topics of study. Airport models dealing with traffic congestion, Air Traffic Control, aircraft, maintenance, and inventory control have been successfully implemented. Financial models have been developed largely by airframe manufacturers as selling tools for new aircraft, and for market research by the plane builders. Cash flow models and models that aid financial control have been applied. General conclusions are that operations research has been investigated as a means to better airline management in most departments of airline operation. Much remains to be done to develop practical operations research competence in the following areas: 1. Advertising and Pricing. 2. Routing and Scheduling of aircraft and crews. 3. Financial Investment. The volume of the literature on operations research is growing rapidly. This thesis includes only a small sampling of the work done prior to 1971. For more intensive study, bibliographies of current and past work should be consulted. An excellent source of bibliographical data is the International Abstracts in Operations Research, by the International Federation of Operational Research Societies, (IFORS).