CASE

FLYAWAY AIRWAYS
 Wesley Shocker, research analyst for flyaway airways has
been asked to make recommendations regarding the best
approach for monitoring the Quality of Service provided
by the airline.
 Current competitors include Midway and Alaska Airlines.
 Such monitoring would involve better understanding the
nature of service quality and the ways in which quality
can be tracked for Airlines.
 
 An airline consumer usually is concerned most with both


Ø SUBJECTIVE ASPECT OF QUALITY: Food, Pleasant

employees
Ø OBJECTIVE ASPECT OF QUALITY: On-Time
performance, Safety and lost baggage.


 Aftersome investigation, Shocker discovered two basic
approaches to measuring quality of airline service that can
produce similar ranking result.

TWO APPROACHES:

1.CONSUMER SURVEY
2.
3.WEIGHTED-AVERAGE RANKING
1.CONSUMER SURVEYS
 This study is based on infrequent survey usually published annually.
 A New York firm, Research & Forecasts, inc., published results of a
consumer survey of frequent flyers that used several criteria to rate
Domestic and International airlines.
Criteria included :

Ø Service
Ø Comfort
Ø Reliability
Ø Quality of food
Ø Cost
Ø Delays
Ø Route served
Ø Safety
Ø Frequent flyer plans
 The survey was sent to 25000 frequent flyers
 The 4,462 people responded were Male (59%), professional
managers (66%), whose average age was 45 and traveled an
average of at least 43 nights a year.
The most important factors in choosing an airline were:

 Route structure
 Price
 Reliability
 Service
 Safety
 Frequent-flyer plans
 food
 THE RESPONDENTS PROVIDED THE FOLLOWING
RANKINGS TO TWENTY AIRLINES:
1. American 11. Lufthansa
2. United 12. USAir
3. Delta 13. KLM
4. TWA 14. America West
5. Swissair 15. JAL
6. Singapore 16. Alaska
7. British airways 17. Qantas
8. Continental 18. Midway
9. Air France 19. Southwest
10.Pan Am 20. SAS
2. WEIGHTED-AVERAGE RANKING
 This is a more objective approach to measure Airline
quality.
 The AIRLINE QUALITY RATING (AQR) is a Weighted
average of 19 factors that have relevance when
judging the quality of airline services.
 The AQR is based on data that are readily
obtainable(updated monthly) from published sources
for each major airline operating in the united states.

 FACTORS INCLUDED IN THE AIRLINE
QUALITY RATING
 FACTOR WEIGHT
1.Average age of fleet -5.85
2.Number of aircraft +4.54
3.On-time performance +8.63
4.Load factor -6.98
5.Pilot deviations -8.03
6.Number of accidents -8.38
7.Frequent flyer awards -7.35
8.Flight problems -8.05
9.Denied boarding -8.03
10.Mishandled baggage -7.92
 FACTORS WEIGHT
11.Fares -7.60
12.Customer service -7.20
13.Refunds -7.32
14.Ticketing/boarding -7.08
15.Advertising -6.82
16.Credit -5.94
17.Other -7.34
18.Financial stability +6.52
19.Average seat-mile cost -4.49
 To establish the 19 weighted factors, an opinion survey was
conducted with a group of 65 experts in the aviation field.
These experts included representatives of major airlines, air
travel experts, FAA representatives, academic researchers,
airline manufacturing, support firms and individual
consumers.
 Each expert was asked to rate importance of each individual
factor using a scale of 0 (no importance) to 10 (great
importance).
 The average importance ratings for each of the 19 factors was
then used as the weight for that factor in the AQR.

USING THE AIRLINE QUALITY RATING FORMULA AND THE RECENT
DATA GIVES THE FOLLOWING AQR SCORES AND RANKINGS FOR THE
TEN MAJOR U.S AIRLINES:

RANK
 AIRLINE AQR
Ø 1 American +.328
Ø 2 Southwest +.254
Ø 3 Delta +.209
Ø 4 United +.119
Ø 5 USAir +.054
Ø 6 Pan Am +.003
Ø 7 Northwest -.063
Ø 8 Continental -.346
Ø 9 America West -.377
Ø 10 TWA -.439
Q. HOW COMPARABLE ARE THE TWO METHODS? IN WHAT WAYS ARE
THEY SIMILAR? IN WHAT WAYS ARE THEY DIFFERENT?

 SIMILARITY
 Both approaches measure quality of airline service that can produce
similar ranking results.


 DIFFERENCE
 Consumer survey relies on direct consumer opinion and mostly
subjective in its approach to quality and elements considered.
 Weighted average ranking relies on performance data that are available
through public source and appear to be more objective.
Q.WHAT POSITIVE AND NEGATIVE ASPECTS OF EACH APPROACH SHOULD
SHOCKER CONSIDER BEFORE RECOMMENDING A COURSE OF ACTION
FOR FLYAWAY AIRWAYS

CONSUMER SURVEY APPROACH:

POSITIVE:

1.OPINION DIRECTLY FROM THE FREQUENT FLYERS.

2. RATING CRITERIA BASED ON THE FACTORS WHICH ARE RELEVANT FOR

MONITORING QUALITY OF SERVICE PROVIDED BY THE AIRLINE.

NEGATIVE:

1.CHANCES OF SAMPLING ERROR.

2.
4.INFREQUENT SURVEY BASED(USUALLY ANNUALLY)
WEIGHTED AVERAGE RANKING

POSITIVE:

1 . OBJECTIVE APPROACH – CAN BE EVALUATED.

2.AIRLINE QUALITY RATING(AQR) BASED ON READILY OBTAINABLE

DATA(UPDATED MONTHLY)
3.
4.NOT RELATED TO EITHER PAST BEHAVIOR OR FUTURE INTENTIONS &
ATTITUDE.
5.
6.AQR BASED ON FACTORS RELEVANT FOR JUDGING QUALITY.
7.
NEGATIVE:

1.BASED ON SOME EXPERTS OPINION-NOT THE FREQUENT FLYERS.

2.
3.EXPENSIVE.
Q.CONSIDERING THE TWO METHOD OUTLINED,WHAT TYPE OF
VALIDITY WOULD YOU CONSIDER TO BE DEMONSTRATED BY TWO
APPROACHES TO MEASURING QUALITY

THE WEIGHTED AVERAGE RANKING IS BASED ON THE SURVEY

WHICH HAS BEEN UPDATED REGULARLY ON A MONTHLY BASIS
& CAN BE READILY OBTAINABLE.

ON THE OTHER HAND THE CONSUMER SURVEY IS BASED ON
INFREQUENT SURVEY THAT USUALLY TOOK PLACE ANNUALLY.

TAKEN INTO CONSIDERATION THE BOTH APPROACHES
WEIGHTED AVERAGE RANKING HAS MORE VALIDITY.
Q.WHICH OF THE METHOD SHOULD SHOCKER RECOMMEND?
WHY?

THE SHOCKER SHOULD GO FOR WEIGHTED AVERAGE RANKING METHOD:

REASONS :

1.SUBJECTIVE BIAS IS ELIMINATED.

2.
3.INFORMATION OBTAINED UNDER THIS METHOD RELATES TO WHAT IS
CURRENTLY HAPPENING AND NOT INFLUENCED BY THE PAST BEHAVIOR
OR FUTURE INTENTIONS.
4.
5.METHOD IS INDEPENDENT OF RESPONDENT WILLINGNESS TO RESPOND.
6.
7.PROVIDES A SYSTEMATIC AND LOGICAL METHOD FROM WHICH THE
RESEARCHER MEASURES THE QUALITY OF AIRLINE SERVICE.
 


THANK YOU



PRESENTED BY:

NEETI MATHUR 09 MBA 50

SHIJO.M.ABRAHAM 09 MBA 78

SHWETA MATHUR 09 MBA 83

SECTION-B