Introduction to OEE

(Overall Equipment Effectiveness)

Table of Contents

1.What is Overall Equipment Effectiveness (OEE)

2.How to calculate OEE
3.Why is important to monitor it
4.Six big losses
5.Exercises

2
What is Overall Equipment Effectiveness (OEE)
Overall Equipment Effectiveness (OEE) is a core metric used to determine
equipment availability, equipment performance and process quality.

OEE
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3
 TPM
Safety Health and Environmental

Attack Six Quality Early

Autonomous Planned Big Losses Maintenance Equipment
Maintenance Maintenance SGA Team focuses
Design and
Achieving and
on continuous sustaining quality by
Start up
Asset focused Moving from
reduction of maintaining equipment Management
‘Small group production losses and processes
reactive to based on facts & data New assets meet
activities’ assumes
proactive Supported by: production needs
ownership for the
maintenance •AIW’s and minimize Life
efficiency of their
•Kaizen Cycle Costs (LCC)
asset(s)
•OEE

Training and Education

One Plan One Team

4
Why Measure?

• Identify losses on a specific asset.

• Provide feedback to stakeholders involved in improvement activities,
and accurately reflect the results of the improvement effort.
• Track facts & data to ensure root cause solutions to problems.
• Demonstrate improvement visually.
• Optimize productive capacity based upon facts & data.
• Use improvement resources to maximize the benefit to production
capacity.
• Enhance ability to convincingly translate improvements into the
language of management ($).

5
Why Measure?

* What gets measured gets fixed.

* If you don’t know what your

losses are,

You can’t fix them

6
6 Big Losses
Equipment Production Losses (Six Big Losses)

Easy to measure
Labor
Materials/spares Low impact on profit
Outside services
Maintenance overhead

Reduced Equipment
Yield Failures
High
impact
Idling and on profits
Minor Stoppage Reduced
Speed

Set-Up and
Adjustment Quality:
Defects in Process
& Rework

8
The Six Big Losses

9
OEE Factors

10
The Six Big Losses

11
How to calculate OEE (in a nutshell)

Total Scheduled Hours

Scheduled
A Planned Production time Downtime
Downtime
B Operating time losses

C Theoretical output
Speed Loss
D Actual output Minor Stops
OEE =
E Actual output B/A x D/C x F/E
Scrap Availability Performance Quality
F Good output Rework Rate Rate Rate

12
Overall Equipment Effectiveness

13
World Class OEE

OEE is essentially the ratio of Fully Productive Time to Planned Production Time. In
practice, OEE is calculated as the product of its 3 contributing factors

OEE = Availability x Performance x Quality

This type of calculation makes OEE a severe test. For example, when all 3 factors are
at 90%, OEE would be 72.9%. The following table shows generally accepted World
Class goals for each factor

Worldwide studies show that the average OEE rate in manufacturing plants is 60%

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Example OEE Calculation

Data: Notice that all data are in the same units

Planned Production Time = (Shift Length – Breaks) = (480 – 60) = 420 min
Operating Time = (Planned Production Time – Down Time) = (420 – 47) = 373 min
Good Pieces = (Total Pieces – Reject Pieces) = (19,271 – 423) = 18,848 pieces

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Example OEE Calculation

16
Your Turn

Exercise –
OEE Calculation

17
Practice Exercise
During an eight hour shift a canning machine is scheduled to run continuously.
It should produce 60 cans per minute, but the machine ran poorly during the
shift. Several jams were encountered and a breakdown finally resulted. The
equipment was down the last two hours of the shift. A total of 1600 cases (12
cans per case) were produced, in addition to 125 damaged cans.

Calculate OEE for this equipment.

Actual Operating Time

Availability =
Planned Production Time

Performance = Amount Loaded x Ideal Cycle Time

Actual Operating Time

Quality = (Amount Loaded - Number of Defects)

Amount Loaded

OEE = _____Availability x______Performance x_____Quality = _____

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Practice Exercise
During an eight hour shift a canning machine is scheduled to run continuously.
It should produce 60 cans per minute, but the machine ran poorly during the
shift. Several jams were encountered and a breakdown finally resulted. The
equipment was down the last two hours of the shift. A total of 1600 cases (12
cans per case) were produced, in addition to 125 damaged cans.
Calculate OEE for this equipment.

Availability = 480 min. - 120 min.

480 min.
= .75 = 75%

Performance = 19325 cans x 1/60 min. = .894 = 89%

360 min.

Quality = (19325 cans - 125 cans) = .993 = 99%

19325 cans

75% (Availability) x______

OEE = _____ 89% (Performance) x_____ 67%
99% (Quality) = _____

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