What is OEE?

OEE is a key ratio for measuring production efficiency. By measuring losses in production, it is possible to identify potential improvements. When you know which losses you have, you can prioritise your resources to achieve the best results.

Continuous measurement of your production efficiency through relevant metrics and the implementation of a monitoring and improvement process makes it possible to constantly improve the effectiveness and profitability of your production process.

Anyone involved with manufacturing knows that conditions change constantly. It is necessary to always maintain control of the manufacturing process in order to ensure the requisite level of quality and profitability.

So how can we measure the level of production efficiency in a manufacturing process? A common approach is to use the key ratio OEE (Overall Equipment Effectiveness). OEE is calculated by measuring 3 underlying elements of production efficiency:

Facility exchange
Quality exchange

Availability has to do with unplanned downtime, for example due to technical faults, material shortages, etc. In this context we often talk about losses as a result of downtime based on the 4M model (Man, Method, Material and Machine).

For example: if a machine stops on account of a technical fault and is unable to produce during 12 minutes of an hour. The downtime (12 minutes = 20% of an hour) produces an A (Availability) score of 80%.

Facility exchange
Performance has to do with losses that are due to the plant producing at a lower speed than intended (production rate losses).

For example: a machine is designed to produce at a rate of 100 units per hour, but quality issues regarding the material mean that the machine must be operated at a lower rate of 90 units per hour. This produces a P (Performance) score of 0.9 or 90%. Micro stops (very short stoppages that are not registered in the daily work) will impact the P (Performance) score in the monitoring phase.

Quality exchange
Quality takes into account the quality of the parts that have been produced.

For example: you produce 100 units, but 2 of the units have defects that make them unsaleable. 98 units are approved (“Good Parts”), thus producing a Q (Quality) score of 98%.

Overall Equipment Effectiveness (OEE)

In order to calculate the OEE score for a manufacturing process, you multiply the scores for Availability, Facility exchange and Quality exchange.

i.e. OEE = Availability * Facility exchange * Quality exchange

A common way of setting an OEE target is to start by calculating the optimal/nominal capacity of the production process, in other words, the production rate that has been determined in relation to available time. This can be calculated based on the technical documentation for the machine.

Helpful tips for setting an OEE target in your plant
Set the machine to the speed you intend to use, then measure how many units the machine produces per unit of time. The reason for performing this check is that we often find that machines do not produce the number of units stated in the machine documentation, or that the speed shown on the machine’s display panel is different to the actual speed.

Say, for example, that the available time is 8 hours and the process can produce 100 units per hour. This equates to a maximum capacity of 800 units. If, after counting the number of units produced during 8 hours of production, it turns out that the process produces 564 correct and saleable units, this equates to an OEE score of: 564/800 = 71%.

Would you like to know more about how the team at Qestio can help you analyse the potential savings in your production plant and support you in the implementation of necessary changes? Contact us!