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OR PRACTICE—Optimization of Vacation Timeshare Scheduling

Department of Business Management, Brigham Young University, Provo, Utah 84602
ses3-or305{at}sm.byu.edu

This paper reports on an application of network-flow integer programming to a vacation timeshare exchange problem. A typical timeshare owner has purchased yearly access to a specific week at a specific resort. The resulting lack of vacation variety is mitigated by systems that allow owners to exchange owned weeks for different weeks at different resorts according to their preferences, the assessed value of what they are exchanging, their contractual priority, and resort availability. The timeshare exchange problem is similar to other preference-based assignment problems such as labor scheduling, preferential bidding, and traditional timetabling, but different in the formulation of the objective function. This paper demonstrates how the effectiveness of timeshare exchange processes can be improved through mathematical optimization, as measured by increased satisfaction of participant preferences. Optimization also presents exchange managers with the opportunity to more precisely manage preference and priority trade-offs among various classes of participants. The trade-off decisions are aided by sensitivity analysis utilizing a minmax criterion.

Subject classifications: operations research applications; optimization; service sector.
History: Received April 2005; revision received January 2007; accepted May 2007.