OEE (Overall Equipment Effectiveness) is a key performance indicator for measuring production efficiency. By measuring production losses, you can identify your potential for improvement. When you know what losses you have,
you can prioritize your resources for maximum effect.
Continuously measuring production efficiency through monitoring and having a follow-up and improvement process makes it possible to constantly improve efficiency and profitability.
Everyone who has worked in manufacturing knows that conditions are constantly changing. You must maintain continuous control over the manufacturing process to ensure that both quality and
profitability are maintained.
So how do you measure production efficiency in a manufacturing process? It’s common to use the key performance indicator OEE (Overall Equipment Effectiveness). In Swedish, we say TAK, which is
an abbreviation of the 3 elements of production efficiency:
T – Availability
A – Performance
K – Quality
Availability Availability concerns unplanned downtime, for example due to technical failures, lack of materials, raw materials, or similar issues. Here, losses are typically discussed in terms of downtime based on the 4M model (Man, Method, Material, and Machine).
Example: if a machine stops due to a technical fault and cannot produce for 12 minutes in an hour. The 12 minutes of downtime (20% of an hour) results in an availability value of
80%.
Performance
Performance refers to losses that occur when the equipment produces at a lower speed than intended (cycle time losses).
Example: if it’s determined that the machine should produce at a rate of 100 units per hour but quality issues with the material require running at a
lower rate of 90 units per hour. This gives a performance value of 0.9 or 90%. Micro-stops (very brief stops that aren’t typically recorded during ongoing operations) will affect the performance value in the follow-up.
Quality
Quality takes into account the quality of what has been produced.
Example: 100 units are produced but 2 units have defects that make them unsellable. 98 units were approved, giving a quality value of 98%.
Production Efficiency
To calculate the Production Efficiency value in the manufacturing process, multiply the Availability value by the Performance value and the Quality value,
Production Efficiency = Availability × Performance × Quality
A common way to determine OEE is to start by calculating the optimal/nominal capacity for the production process, that is, the production rate determined in
relation to available time. This can be obtained from the technical documentation for the machine.
Tips for determining OEE in your facility
Set the machine speed you intend to use and then measure how many units the machine produces per time unit. The reason for this is that we often see machines that don’t
produce the number of units specified in the machine documentation, or that the speed shown on the machine display differs from the actual speed.
For example, if the available time is 8 hours and the process can make 100 units per hour, this gives a maximum capacity of 800 units. If after counting produced
units during 8 hours of production, you find that 564 units are correct and can be sold, this gives an OEE value of: 564/800 = 71%.
If you want to know more about how we at Qestio can help you analyze the potential savings in your production facility and support you in implementing the necessary changes – contact us.
