OEE Factors

Where Do We Start?
OEE analysis starts with Plant Operating Time; the amount of time your facility is open and available for equipment operation.

From Plant Operating Time, you subtract a category of time called Planned Shut Down, which includes all events that should be excluded from efficiency analysis because there was no intention of running production (e.g. breaks, lunch, scheduled maintenance, or periods where there is nothing to produce). The remaining available time is your Planned Production Time.

OEE begins with Planned Production Time and scrutinizes efficiency and productivity losses that occur, with the goal of reducing or eliminating these losses. There are three general categories of loss to consider - Down Time Loss, Speed Loss and Quality Loss.

Availability
Availability takes into account Down Time Loss, which includes any Events that stop planned production for an appreciable length of time (usually several minutes - long enough to log as a trackable Event). Examples include equipment failures, material shortages, and changeover time. Changeover time is included in OEE analysis, since it is a form of down time. While it may not be possible to eliminate changeover time, in most cases it can be reduced. The remaining available time is called Operating Time.

Performance
Performance takes into account Speed Loss, which includes any factors that cause the process to operate at less than the maximum possible speed, when running. Examples include machine wear, substandard materials, misfeeds, and operator inefficiency. The remaining available time is called Net Operating Time.

Quality

Quality takes into account Quality Loss, which accounts for produced pieces that do not meet quality standards, including pieces that require rework. The remaining time is called Fully Productive Time. Our goal is to maximize Fully Productive Time.

Quick Review
Now that you have taken a look at how the factors that contribute to OEE Losses are developed we can quickly review the key points. Loss Planned Shutdown OEE Factor Not part of the OEE calculation.

Down Time Loss

Availability is the ratio of Operating Time to Planned Production Time (Operating Time is Planned Production Time less Down Time Loss). Calculated as the ratio of Operating Time to Planed Production Time. 100% Availability means the process has been running without any recorded stops. Performance is the ratio of Net Operating Time to Operating Time (Net Operating Time is Operating Time less Speed Loss). Calculated as the ratio of Ideal Cycle Time to Actual Cycle Time, or alternately the ratio of Actual Run Rate to Ideal Run Rate. 100% Performance means the process has been consistently running at its theoretical maximum speed. Quality is the ratio of Fully Productive Time to Net Operating Time (Fully Productive Time is Net Operating Time less Quality Loss). Calculated as the ratio of Good Pieces to Total Pieces. 100% Quality means there have been no reject or rework pieces.

Speed Loss

Quality Loss

As you can see, the core concepts of OEE are quite simple and really help to focus on the underlying causes of productivity loss. We can delve even deeper into productivity losses by understanding the Six Big Losses. OEE Primer

Six Big Losses

Defining the Six Big Losses

One of the major goals of TPM and OEE programs is to reduce and/or eliminate what are called the Six Big Losses the most common causes of efficiency loss in manufacturing. The following table lists the Six Big Losses, and shows how they relate to the OEE Loss categories.
Six Big Loss Category OEE Loss Category Event Examples

Comment There is flexibility on where to set the threshold between a Breakdown (Down Time Loss) and a Small Stop (Speed Loss).

Breakdowns

Down Time Loss

Tooling Failures Unplanned Maintenance General Breakdowns Equipment Failure Setup/Changeover Material Shortages Operator Shortages Major Adjustments Warm-Up Time Obstructed Product Flow Component Jams Misfeeds Sensor Blocked Delivery Blocked Cleaning/Checking Rough Running Under Nameplate Capacity Under Design Capacity Equipment Wear Operator Inefficiency Scrap Rework In-Process Damage In-Process Expiration Incorrect Assembly Scrap Rework In-Process Damage In-Process Expiration Incorrect Assembly

Setup and Adjustments

Down Time Loss

This loss is often addressed through setup time reduction programs.

Small Stops

Speed Loss

Typically only includes stops that are under five minutes and that do not require maintenance personnel.

Reduced Speed

Speed Loss

Anything that keeps the process from running at its theoretical maximum speed (a.k.a. Ideal Run Rate or Nameplate Capacity). Rejects during warm-up, startup or other early production. May be due to improper setup, warm-up period, etc.

Startup Rejects

Quality Loss

Production Rejects

Quality Loss

Rejects during steady-state production.

Addressing the Six Big Losses

Now that we know what the Six Big Losses are and some of the events that contribute to these losses, we can focus on ways to monitor and correct them. Categorizing data makes loss analysis much easier, and a key goal should be fast and efficient data collection, with data put to use throughout the day and in real-time.
Breakdowns

Eliminating unplanned Down Time is critical to improving OEE. Other OEE Factors cannot be addressed if the process is down. It is not only important to know how much Down Time your process is experiencing (and when) but also to be able to attribute the lost time to the specific source or reason for the loss (tabulated through Reason Codes). With Down Time and Reason Code data tabulated, Root Cause Analysis is applied starting with the most severe loss categories.
Setup and Adjustments

Setup and Adjustment time is generally measured as the time between the last good part produced before Setup to the first consistent good parts produced after Setup. This often includes substantial adjustment and/or warm-up time in order to consistently produce parts that meet quality standards. Tracking Setup Time is critical to reducing this loss, together with an active program to reduce this time (such as an SMED - Single Minute Exchange of Dies program). Many companies use creative methods of reducing Setup Time including assembling changeover carts with all tools and supplies necessary for the changeover in one place, pinned or marked settings so that coarse adjustments are no longer necessary, and use of prefabricated setup gauges.
Small Stops and Reduced Speed

Small Stops and Reduced Speed are the most difficult of the Six Big Losses to monitor and record. Cycle Time Analysis should be utilized to pinpoint these loss types. In most processes recording data for Cycle Time Analysis needs to be automated since cycles are quick and repetitive events that do not leave adequate time for manual data-logging. By comparing all completed cycles to the Ideal Cycle Time and filtering the data through a Small Stop Threshold and Reduced Speed Threshold the errant cycles can be automatically categorized for analysis. The reason for analyzing Small Stops separately from Reduced Speed is that the root causes are typically very different, as can be seen from the Event Examples in the previous table.
Startup Rejects and Production Rejects

Startup Rejects and Production Rejects are differentiated, since often the root causes are different between startup and steady-state production. Parts that require rework of any kind should be

considered rejects. Tracking when rejects occur during a shift and/or job run can help pinpoint potential causes, and in many cases patterns will be discovered. Often a Six Sigma program, where a common metric is achieving a defect rate of less than 3.4 defects per million opportunities, is used to focus attention on a goal of achieving near perfect quality. OEE Primer

World Class OEE

OEE is essentially the ratio of Fully Productive Time to Planned Production Time (refer to the OEE Factors section for graphic representation). In practice, however, OEE is calculated as the product of its three contributing factors: OEE = Availability x Performance x Quality This type of calculation makes OEE a severe test. For example, if all three contributing factors are 90.0%, the OEE would be 72.9%. In practice, the generally accepted World-Class goals for each factor are quite different from each other, as is shown in the table below. OEE Factor World Class Availability 90.0% Performance 95.0% Quality 99.9% Overall OEE 85.0% Of course, every manufacturing plant is different. For example, if your plant has an active Six Sigma quality program, you may not be satisfied with a first-run quality rate of 99.9%. Worldwide studies indicate that the average OEE rate in manufacturing plants is 60%. As you can see from the above table, a World Class OEE is considered to be 85% or better. Clearly, there is room for improvement in most manufacturing plants! How about yours?

Go on to Calculating OEE Download the Fast Guide to OEE Learn how Vorne can assis

alculating OEE
The Formulas

As described in World Class OEE, the OEE calculation is based on the three OEE Factors: Availability, Performance, and Quality. Heres how each of these factors is calculated.
Availability

Availability takes into account Down Time Loss, and is calculated as: Availability = Operating Time / Planned Production Time
Performance

Performance takes into account Speed Loss, and is calculated as: Performance = Ideal Cycle Time / (Operating Time / Total Pieces) Ideal Cycle Time is the minimum cycle time that your process can be expected to achieve in optimal circumstances. It is sometimes called Design Cycle Time, Theoretical Cycle Time or Nameplate Capacity. Since Run Rate is the reciprocal of Cycle Time, Performance can also be calculated as: Performance = (Total Pieces / Operating Time) / Ideal Run Rate Performance is capped at 100%, to ensure that if an error is made in specifying the Ideal Cycle Time or Ideal Run Rate the effect on OEE will be limited.
Quality

Quality takes into account Quality Loss, and is calculated as: Quality = Good Pieces / Total Pieces
OEE

OEE takes into account all three OEE Factors, and is calculated as: OEE = Availability x Performance x Quality It is very important to recognize that improving OEE is not the only objective. Take a look at the following data for two production shifts.
OEE Factor Availability Shift 1 Shift 2 90.0% 95.0%

Performance 95.0% 95.0% Quality OEE 99.5% 96.0% 85.1% 86.6%

Superficially, it may appear that the second shift is performing better than the first, since its OEE is higher. Very few companies, however, would want to trade a 5.0% increase in Availability for a 3.5% decline in Quality! The beauty of OEE is not that it gives you one magic number; its that it gives you three numbers, which are all useful individually as your situation changes from day to day. And it helps you visualize performance in simple terms - a very practical simplification.

Example OEE Calculation

The table below contains hypothetical shift data, to be used for a complete OEE calculation, starting with the calculation of the OEE Factors of Availability, Performance, and Quality. Note that the same units of measurement (in this case minutes and pieces) are consistently used throughout the calculations.
Item Shift Length Short Breaks Meal Break Down Time Data 8 hours = 480 min. 2 @ 15 min. = 30 min. 1 @ 30 min. = 30 min. 47 minutes

Ideal Run Rate 60 pieces per minute Total Pieces 19,271 pieces

Reject Pieces 423 pieces Planned Production Time = Shift Length - Breaks = 480 - 60 = 420 minutes

Operating Time = Planned Production Time - Down Time = 420 - 47 = 373 minutes Good Pieces = Total Pieces - Reject Pieces = 19,271 - 423 = 18,848 pieces Availability = Operating Time / Planned Production Time = 373 minutes / 420 minutes = 0.8881 or 88.81% Performance = (Total Pieces / Operating Time) / Ideal Run Rate = (19,271 pieces / 373 minutes) / 60 pieces per minute = 0.8611 or 86.11% Quality = Good Pieces / Total Pieces = 18,848 / 19,271 pieces = 0.9780 or 97.80% OEE = Availability x Performance x Quality = 0.8881 x 0.8611 x 0.9780 = 0.7479 or 74.79%