Benchmarking airports from a managerial perspective

Nicole Adler*, Vanessa Liebert, Ekaterina Yazhemsky

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

105 Scopus citations

Abstract

Benchmarking airports is currently popular both in the academic literature and in practice but has proved rather problematic due to the heterogeneity inherent in any reasonably sized dataset. Most studies either treat the airport production technology as a black box, or separate the terminal and airside activities, assessing them individually. In this article we analyze airports as a single unit due to the direct complementarities, thus avoiding the artificial separation of inputs. Using data envelopment analysis (DEA), we open the black box in which a network describes the production process, thus demonstrating the sequential effects that separate final from intermediate outputs, including those under partial managerial control and those that are known to be non-discretionary. To further improve the benchmarking process, we identify appropriate peers for a case study of 43 European airports over 10 years, through a restricted reference mechanism according to pre-defined characteristics. Compared to basic DEA models, the results of the proposed structure provide more meaningful benchmarks with comparable peer units and target values that are potentially achievable in the medium term. By identifying each unit's individual reference set, unique outliers influence the performance measurement less severely than occurs under basic DEA. In addition, the formulations produce an implementation path that moves the airport towards the Pareto frontier gradually, taking into account the regulatory and business environment in which the unit is located.

Original languageAmerican English
Pages (from-to)442-458
Number of pages17
JournalOmega (United Kingdom)
Volume41
Issue number2
DOIs
StatePublished - Apr 2013

Bibliographical note

Funding Information:
We would like to thank the German Airport Performance (GAP) and German Aviation Benchmarking (GAB) research projects that are funded by the German Ministry of Education and Research for providing the data. Further, we thank Prof. Gert Brunekreeft, Prof. Peter Forsyth, Prof. David Gillen, Dr. Thomas Immelman, Prof. Hans-Martin Niemeier, Prof. Mike Tretheway and the participants of the German Aviation Research Society (GARS) seminar on Airport Benchmarking in November 2009, the World Bank roundtable on Transport Productivity in February 2010 and the INFORMS Conference 2010 for fruitful discussions as well as extremely helpful comments from two referees of this Journal. Nicole Adler would also like to thank the Recanati Fund for partial funding of this research.

Keywords

  • Air transport
  • Benchmarking
  • Business policy
  • DEA

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