What is Overall Equipment Effectiveness?
Overall Equipment Effectiveness (OEE) is a comprehensive metric used to evaluate the performance of manufacturing equipment, machinery, and overall operations. The primary factors of OEE are availability, performance, and quality. By monitoring and enhancing the efficiency of manufacturing equipment, companies and organizations can achieve higher productivity, reduce costs, and improve competitiveness.
OEE is also crucial for manufacturing industries for the following purposes:
- Identifying bottlenecks and downtime,
- Enhancing productivity,
- Optimizing resources, and
- Benchmarking and setting goals.
How is availability calculated for Overall Equipment Effectiveness?
Availability is the proportion of the actual operating time compared to the planned production time of a manufacturing process. Calculating availability provides an accurate snapshot of a manufacturing system’s uptime, or the period in which it is effectively productive. For example, if a machine is producing parts for a total of six hours throughout each eight-hour shift, then the availability for that operation is at 75%. The measure of availability is pivotal in spotting and rectifying equipment-related inefficiencies that can impede a process.
How is performance calculated for Overall Equipment Effectiveness?
Performance, as a measure, compares the actual cycle time against the standard planned cycle time. Performance focuses on the speed of the process. If a system is designed to produce 100 units per hour but only manages to produce 90 units, the performance rate is 90%. The measure of performance is vital for identifying bottlenecks and other operational issues that may be slowing down the manufacturing process.
How is quality calculated for OEE?
Quality is a measure of the compliant parts produced as a fraction of the total units produced during running time. So, if out of 100 units produced, five units need rework, the quality is 95%. Quality reflects the ability of a production process to produce items within the required specification, and it helps in quantifying the impact of defects and reworks.
How is an OEE score calculated?
Recall that an OEE score is calculated by multiplying the primary factors of Overall Equipment Effectiveness: availability, performance, and quality. An OEE score of 0% implies no effective production, a scenario in which all products are defective, or unusable, or nothing is manufactured. An OEE score of 100% represents an ideal state of productivity with zero defects and all “good,” or usable products, that can be sold. An OEE score of 85% is considered excellent, or “world-class,” for discrete manufacturers. However, a score lower than this is not a cause for alarm. All processes exhibit different levels of variations and maximizing productivity is an ongoing exercise of analysis and improvement. The value of the OEE score is found not in achieving the elusive 100%, but in its ability to pinpoint areas for improvement.