OEE: How to understand the efficiency of the machines on production lines

How to score operational excellence for strategic decision making? Establish a solid foundation for production efficiency by calculating OEE.

Like in many other disciplines, monitoring and the use of metrics are key to move forward along the efficiency road.

Production indicators are essential to track the efficiency, and enable to know the status and evolution of each process.

These measurement units help understand factors like performance, productivity, service quality or time management, allowing manufacturers to reach their long and short-term goals, understand the situation and assess the effectiveness of potential strategies.

What is the OEE and what can I measure with it?

The OEE (Overall Equipment Effectiveness) enables to measure the operating efficiency of a machine, showing the actual production capacity of industrial equipment and helping to identify potential process inefficiencies including rejections, interruptions, breakdowns, slowdowns, etc.

Applicable to any production process having a previously defined working standard, the OEE is expressed as a percentage, with a 0-100% value range in which 100% represents the optimal production situation.

How do I calculate the OEE in my industry?

To calculate the correct OEE, three fundamental variables should be considered:

1) The availability is calculated by dividing the total operating time (or the time the equipment has been working without any interruption) by the scheduled production time.2) The performance is the actual process speed divided by the optimal process speed. This parameter indicates what was manufactured (good and bad) during the operating time vs. what should have been manufactured during the ideal cycle time.

3) The quality is obtained by dividing the actual production quality by the total scheduled production.

It is estimated that most industries operate with OEE levels below 70%, which means a significant economic loss and a huge opportunity to work on the improvements.

Quantifying the OEE has multiple benefits, allowing to discover the source of the most frequent losses, helping to improve the quality of your production, and reducing reworks, defective units and lead times.