Evaluation of key performance indicators of Indian airlines using fuzzy AHP method

Abstract

Due to intense competition, decreasing profit margins and demanding customers in the air transport business, airlines have to measure their performance in order to remain competitive as well as sustainable in the airline market. The performance of an airline depends on many factors these are known as key performance indicators (KPIs). This study makes an attempt to evaluate the KPIs of airlines. Evaluation of KPIs is done using a combined approach based on fuzzy theory and analytic hierarchy process (AHP) method. A case example of Indian airlines is conducted to illustrate the proposed model applicability. The results of the study indicates that the priority order of the KPIs is SSR > OMR > CR > FBR, which show that safety and security related indicators are found most important in this priority list and financial and business related parameters ranked last. This study makes an important contribution to various airline companies by solving significant problems in order to enhance their performances in the competitive market with proposed methodology. This proposed method considered fuzzy framework that can handle impreciseness and uncertainty. Sensitivity analysis is also performed to test the robustness of the proposed model.