Revenue management model for on-demand IT services

Liu, Tieming; Methapatara, Chinnatat; Wynter, Laura

doi:10.1016/j.ejor.2010.04.024

Cited by 15 publications

(2 citation statements)

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“…The demand for products and services changes in a short period of time. In order for companies to make profitable transactions, they need to adapt quickly to changes that occur in a short time in demand (Methapatara and Wynter, 2010). Airlines need to dynamically manage their inventory from the start of the booking process (usually one year before departure) to the day of departure, after determining their pricing plans and fare structures.…”

Section: Revenue Management In Civil Aviation Sectormentioning

confidence: 99%

Examining the impact of cargo and ancillary revenues on net profit for full service carrier airlines

Bas¹,

Aksoy²

2022

IJBES

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In this study, the relationships between cargo revenues, ancillary revenues and net profitability of airline companies were examined in the examples of three full-service airline companies (Turkish Airlines, American Airlines, Delta Air Lines). Methodologically, a logarithmic econometric model was used in which cargo revenues and ancillary revenues were included as independent variables and net profit as the dependent variables. The data used for the period 2014Q1-2019Q4 were collected from the annual reports on the official websites of related airline companies and The International Air Transport Association (IATA). EViews 10 and STATA-15 versions, which are the most modern econometric analysis programs that can be used to control the stationarity, were used in the analysis of the data. In addition to econometric analyzes and general statistics, Cross Section dependency tests, CADF second-generation unit root tests, Delta slope homogeneity tests, Panel cointegration analysis, Westerlund Panel cointegration tests and Dumitrescu Hurlin Panel Causality tests and Breusch Pagan LM Tests were also performed. The study revealed that there is cointegration between cargo revenues, ancillary revenues and net profit, and there is a one-way causality relationship from both cargo revenues to net profit and from ancillary revenues to net profit. The study also indicated a positive correlation between cargo revenues and ancillary revenues and net profit. In other words, cargo revenues and ancillary revenues have a positive effect on the net profit of airline companies. In addition, the study found that aviation ancillary revenues provide an important resource for airline companies; furthermore, two US companies are among the top three companies with the highest revenues in the world in terms of cargo and ancillary revenues; also showed that Turkish Airlines' ancillary revenues are lower than those of these two US companies. On the other hand, the study showed that the contribution of Turkish Airlines cargo revenues to net profit is much higher than the other two companies.

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Section: Revenue Management In Civil Aviation Sectormentioning

confidence: 99%

Examining the impact of cargo and ancillary revenues on net profit for full service carrier airlines

Bas¹,

Aksoy²

2022

IJBES

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“…Considering business processes with highly volatile demand, however, this potential economic benefit might be lowered, as external service providers in this case usually will not commit a SLA at reasonable costs for the on demand supply of capacities: To avoid high contractual penalties caused by the violation of SLA commitments for on demand supply an external service provider would have to provide high reserve capacities causing significant fixed costs [14]. These high fixed costs of external service providers will usually result in prohibitive high SLA costs for the buyer.…”

Section: Introductionmentioning

confidence: 99%

Integrating Business Partners on Demand: The Effect on Capacity Planning for Cost Driven Support Processes

Dorsch

Häckel

2012

2012 45th Hawaii International Conference on System Sciences

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Capacity planning for business processes is still a major challenge. Technology enabling on demand integration of business partners handling peak load at short notice may help. We model a three-stage supply chain with a service provider receiving demand from its customers usually executed by an in-house unit. Alternatively the demand can be routed to external business partners if these offer capacity and a preferable execution. Then the capacity planning problem of the service provider is examined: In what way does this "on demand integration capability" affect the optimal level of in-house capacity? The model consists of two separate queuing systems (inhouse unit and external business partners) along with their relevant cost functions. Furthermore a routing algorithm is developed. It evaluates both systems for every incoming order and decides about routing to the preferable one. To derive results a discrete-event simulation is necessary performed within a case study of the securities trading and settlement process. Three insights are gained: There are situations where on demand integration leads to reduced optimal capacity. Furthermore the risk of allocating an inappropriate amount of capacity can be reduced as well as the total operating costs of the business process.

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Provider selection and task allocation in telecommunications with QoS degradation policy

et al. 2016

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Revenue management model for on-demand IT services

Cited by 15 publications

References 50 publications

Examining the impact of cargo and ancillary revenues on net profit for full service carrier airlines

Examining the impact of cargo and ancillary revenues on net profit for full service carrier airlines

Integrating Business Partners on Demand: The Effect on Capacity Planning for Cost Driven Support Processes

Provider selection and task allocation in telecommunications with QoS degradation policy

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