Practice Summaries: American Airlines Uses Should-Cost Modeling to Assess the Uncertainty of Bids for Its Full-Truckload Shipment Routes

Michael J. Bailey (), John Snapp (), Subramani Yetur (), Jeffrey S. Stonebraker (), Steven A. Edwards (), Aaron Davis () and Robert Cox ()
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Michael J. Bailey: College of Management, North Carolina State University, Raleigh, North Carolina 27695
John Snapp: College of Management, North Carolina State University, Raleigh, North Carolina 27695
Subramani Yetur: College of Management, North Carolina State University, Raleigh, North Carolina 27695
Jeffrey S. Stonebraker: College of Management, North Carolina State University, Raleigh, North Carolina 27695
Steven A. Edwards: College of Management, North Carolina State University, Raleigh, North Carolina 27695
Aaron Davis: American Airlines, Inc., Tulsa, Oklahoma 74116
Robert Cox: American Airlines, Inc., Tulsa, Oklahoma 74116

Interfaces, 2011, vol. 41, issue 2, 194-196

Abstract: We used decision analysis to develop a probabilistic model to help American Airlines assess the uncertainty of bid quotes for its full-truckload (FTL) point-to-point freight shipments of maintenance equipment and in-flight service items in the United States. The model reduced the airline's risk of overpaying an FTL supplier.

Keywords: decision analysis; applications; cost analysis; industries; transportation/shipping (search for similar items in EconPapers)
Date: 2011
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