1. OEE (Overall Equipment Effectiveness) is the gold standard for measuring manufacturing productivity. Simply put – it identifies the percentage of manufacturing time that is truly productive. An OEE score of 100% means you are manufacturing only Good Parts, as fast as possible, with no Stop Time. In the language of OEE that means 100% Quality (only Good Parts), 100% Performance (as fast as possible), and 100% Availability (no Stop Time).
2. Measuring OEE is a manufacturing best practice. By measuring OEE and the underlying losses, you will gain important insights on how to systematically improve your manufacturing process. OEE is the single best metric for identifying losses, benchmarking progress, and improving the productivity of manufacturing equipment (i.e., eliminating waste).
SIMPLE CALCULATION
1. The simplest way to calculate OEE is as the ratio of Fully Productive Time to Planned Production Time. Fully Productive Time is just another way of saying manufacturing only Good Parts as fast as possible (Ideal Cycle Time) with no Stop Time. Hence the calculation is:
OEE = (Good Count × Ideal Cycle Time) / Planned Production Time
2. Although this is an entirely valid calculation of OEE, it does not provide information about the three loss-related factors: Availability, Performance, and Quality. For that – we use the preferred calculation.
AVAILABILITY
1. Availability takes into account all events that stop planned production long enough where it makes sense to track a reason for being down (typically several minutes).
2. Availability is calculated as the ratio of Run Time to Planned Production Time:
Availability = Run Time / Planned Production Time
3. Run Time is simply Planned Production Time less Stop Time, where Stop Time is defined as all time where the manufacturing process was intended to be running but was not due to Unplanned Stops (e.g., Breakdowns) or Planned Stops (e.g., Changeovers).
Run Time = Planned Production Time − Stop Time
PERFORMANCE
1. Performance takes into account anything that causes the manufacturing process to run at less than the maximum possible speed when it is running (including both Slow Cycles and Small Stops).
2. Performance is the ratio of Net Run Time to Run Time. It is calculated as:
Performance = (Ideal Cycle Time × Total Count) / Run Time
3. Ideal Cycle Time is the fastest cycle time that your process can achieve in optimal circumstances. Therefore, when it is multiplied by Total Count the result is Net Run Time (the fastest possible time to manufacture the parts).
4. Since rate is the reciprocal of time, Performance can also be calculated as:
Performance = (Total Count / Run Time) / Ideal Run Rate
5. Performance should never be greater than 100%. If it is, that usually indicates that Ideal Cycle Time is set incorrectly (it is too high).
QUALITY
1. Quality takes into account manufactured parts that do not meet quality standards, including parts that need rework. Remember, OEE Quality is similar to First Pass Yield, in that it defines Good Parts as parts that successfully pass through the manufacturing process the first time without needing any rework. Quality is calculated as:
Quality = Good Count / Total Count
2. This is the same as taking the ratio of Fully Productive Time (only Good Parts manufactured as fast as possible with no Stop Time) to Net Run Time (all parts manufactured as fast as possible with no stop time).
OEE
1. OEE takes into account all losses, resulting in a measure of truly productive manufacturing time. It is calculated as:
OEE = Availability × Performance × Quality
2. If the equations for Availability, Performance, and Quality are substituted in the above and reduced to their simplest terms the result is:
OEE = (Good Count × Ideal Cycle Time) / Planned Production Time
PREFERRED OEE CALCULATION
1. OEE scores provide a very valuable insight – an accurate picture of how effectively your manufacturing process is running. And, it makes it easy to track improvements in that process over time.
2. What your OEE score doesn’t provide is any insights as to the underlying causes of lost productivity. This is the role of Availability, Performance, and Quality.
3. In the preferred calculation you get the best of both worlds. A single number that captures how well you are doing (OEE) and three numbers that capture the fundamental nature of your losses (Availability, Performance, and Quality).
(Source:OEE)
