Operational Efficiency and Firm Performance: Developing Propositions in the Air Transportation Sector

The relationship between operational efficiency and firm performance measures of firms in the airline sector has not been thoroughly examined in the past. This study aims to develop a framework on the relationship between performance and operational efficiency in the airline sector. The pertinent literature on the relationship between operational efficiency and firm performance for the period 2010-2024 has been gathered, and the PRISMA approach has been used to synthesize it. The study reveals that various operational efficiency measures and firm performance are tentatively related. Furthermore, the number of passengers carried, departures, cargo carried, and leasing charges are expected to moderate this relationship. The suggested framework of this research should assist managers in conceptualizing and tentatively optimizing the relationship between operational efficiency and firm performance. The study develops a conceptual framework that adds value to existing principles and processes for operational efficiency and firm performance in the transportation industry.