PERFORMANCE EVALUATION OF AIRLINES BASED ON BALANCED SCORECARD WITH DATA ENVELOPMENT ANALYSIS

Abstract

Balanced Scorecard (BSC) approach is useful to determine the overall performance of an
organization. The approach integrates four perspectives of any business organization. Selection
of proper performance measures is the key issue in implementation of BSC to evaluate
performance of an organization. In this study, a hybrid approach is proposed to by integrating
BSC and Data Envelopment Analysis (DEA)to evaluate the performance of Airlines. In DEA
model, virtual ideal and anti-ideal DMUs are defined. The BSC measures are utilized as input
and output variables of DEA model. The Proposed methodology improves the discrimination
power among the overall performances of alternatives. A case study of 100 world major
airlines considered for the study. Data on eight performance enablers under four perspectives
for the case study of airlines during 2009 to 2013 is considered. The proposed methodology
provides a sense of improvement and dynamics for overall performance evaluation of
organizations based on both risk seeker and risk averse decision makers.