Alabama Airlines opened its doors in June 1995 as a commuter service with its headquarters and only hub located in Birmingham. A product of airline deregulation, Alabama Air joined the growing number...

Alabama Airlines opened its doors in June 1995 as a commuter service with its headquarters
and only hub located in Birmingham. A product of airline deregulation, Alabama Air joined the
growing number of successful short-haul, point-to-point airlines, including Lone Star, Comair,
Atlantic Southeast, Skywest, and Business Express.
Alabama Air was started and managed by two former pilots, David Douglas (who had been with
the defunct Eastern Airlines) and Savas Ozatalay (formerly with Pan Am). It acquired a fleet of
12 used prop-jet planes and the airport gates vacated by the 1994 downsizing of Delta Air Lines.

1. What would you advise Alabama Air to do for the current reservation system based on the
original call distribution? Create a simulation model to investigate the scenario.
Describe the model carefully and justify the duration of the simulation, assumptions, and
measures of performance.
2. What are your recommendations regarding operator utilization and customer satisfaction if
the airline proceeds with the advertising campaign?

SOLUTION

This case describes a single-server queuing scenario that is to be investigated by simulation. The
basic premise can be applied to various queuing scenarios (e.g., bank, post office, cinema box
office, among others) and is not restricted to the Alabama Airlines reservation scenario. The
purpose of the case is to introduce students to simulation as a powerful decision-making aid.
When presenting simulation modeling techniques in the classroom, one is faced with the
following dilemma: the trade-off between the benefits of the modeling and decision-making
process versus the complexity and the tedium of the required calculations. Spreadsheets that
have a random number generator provide a means whereby the principles and methodology of
simulation can be introduced and illustrated by investigating the decision-making process for
meaningful size problems without making the associated calculation requirements too
burdensome. A spreadsheet such as Excel is envisaged as the vehicle for this simulation.
In the assignment the students consider themselves to be quantitative analysts
investigating the particular scenario for their client(s). The assignments are presented in the
form of a report to their clients. For each scenario, an “executive summary” is required stating
the main results and recommendations. The body of the report then supports these
recommendations with precise explanations, relevant data, and models. Students are
encouraged to be concise and to the...