What is OEE?
- Overall Equipment Effectiveness (OEE) is a measure of how well a manufacturing operation is utilized (Material, Time and Facilities) compared to it's full potential, during the periods when it is scheduled to run.
- It is an important characteristics of capacity planning, material planning and other resource planning.
- OEE is the single best metric for identifying losses, benchmarking progress, and improving the productivity of manufacturing equipment's.
Factors of OEE
1) Availability
- It is percentage of time the machine is ready to run, working properly and not in the mindset of changeovers.
- Run Time = Planned production time - stop time
- Stop time includes Equipment failure, Excess changeovers, Material shortage etc.
- Availability is calculates as ratio of Run Time to Planned production time.
- Availability = Run Time / Planned production time
2) Performance
- Performance shows the excess time taken for manufacturing as compared to standard operating time.
- Performance includes all factors that cause the production to operate at less than the maximum possible speed when running which includes Fatigue of the operator, Excess cycle time in manual operation, slow process of loading/unloading of job.
- Performance is calculated by Net Run Time to Run Time.
- Performance = (Ideal Cycle Time x Total Count) / Run Time
- Ideal Cycle time is the theoretical fastest possible time to produce one piece.
- Performance should never be greater than 100%.
3) Quality
- Quality focuses on calculating the time that was wasted by producing a product that does not meet quality standards.
- It is similar to First Pass Yield means good parts that successfully pass through the manufacturing process the first time without needing any rework.
- Quality loss includes defects and rework
- Quality is calculated as ratio of Good Count to Total Count
- Quality = Good Count / Total Count
OEE Calculations
- OEE is the ratio of Fully productive time to Planned production time
- OEE = Availability x Performance x Quality
- OEE = (Good Count x Ideal cycle time) / Planned production time
- OEE consider all losses Stop time loss, speed loss and quality loss.
Example
Benefits of OEE
- Gives you a better oversight of the production process, so you understand where the real problems exist and how to priorities them.
- Delivers significant return on investment whether you are increasing capacity, driving efficiencies, launching new products, and more.
- Improved process quality which will save you time and money as well as helping maintain your reputation in the market.
- Reduces machine maintenance and repair costs as you can put proper plans and schedules in place.
OEE Benchmarks
- OEE score of 100% is perfect production: manufacturing only good parts, as fast as possible, with no stop time.
- OEE score of 85% is considered world class for discrete manufacturers. For many companies, it is a suitable long-term goal.
- OEE score of 60% is fairly typical for discrete manufacturers, but indicates there is substantial room for improvement.
- OEE score of 40% is not at all uncommon for manufacturing companies that are just starting to track and improve their manufacturing performance by reducing largest source of downtime.
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