OEE Calculation – Overall Equipment Effectiveness

OEE Calculation

OEE Means Overall Equipment Effectiveness.
The OEE calculation gives the answer to 2 big questions:

A) Am I using the equipment in an effective way?

B) Where have I to do actions to improve the equipment effectiveness?

Before moving to the OEE Calculation is important to understand that OEE one of the indicators of the TPM and the TPM is one of the Lean Tools.

To understand the OEE it is crucial to introduce the 6 big losses.

6 Big Losses

As for the 7 wastes in a process, a machine does not produce value of one of the following losses occur.

The six big losses are:

1) Breakdown
2) Changeover
3) Minor Stops
4) Reduced Speed
5) Scrap, Rework, Yield
6) Start-Up Losses

The six big losses can be grouped into 3 categories:
Availability
Performance
Quality

Let us go into details:

# Availability

Breakdown losses are unplanned stoppage requiring repair.
Changeover and adjustment losses occur when changing over between products

# Performance

Minor Stops and Idling are often defined as stops taking less than 10 minutes.
Reduced Speed Losses result from the machine running at less than the design speed.

# Quality

Defects result in scrap or rework and are the result of any problem that causes the machine to work outside of the specification limits.

The OEE is the product of these 3 factors expressed in percentage:

OEE = 88% * 83% * 86% = 63%

The world-class OEE is recognized to be 85%

OEE Implementation Step by Step

After the theory let me explain how to calculate OEE into reality:

Step 1 – Plan carefully which machine you want to perform the OEE Calculation. Is the machine a bottleneck? Is the machine overproducing?

Step 2 – Involve operators and create a cross-functional team. Typically operators love machine running without problems.

Step 3 – Start collecting reliable data. Believe me, this is the hardest part. A Lean Morning Meeting is the best way to involve people in data collection.

Step 4 – Analyze data, create graphs, discuss it at the morning meeting.

Step 5 – Implement actions to improve OEE, track it at the morning meeting. Continue measuring and improve.

Remember: The OEE calculation is not the goal. OEE Calculation is a way to understand what is limiting the productivity of a machine and indicate where to act to improve.

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