Incompatible goals, uncertain information and conflicting incentives: The dispatch dilemma

Abstract

This paper presents a series of sensitivity analyses, using a traditional decision tree and Monte Carlo methods, that provide a rational approach for resolving dilemmas posed by conflicting airline dispatch incentives. Adoption of this approach might save the industry millions, but would require a wholesale change in corporate philosophy. The paper advocates incentive structures that place greater value on the process of decisionmaking than in their largely uncontrollable outcomes.