OEE (Overall Equipment Effectiveness) | Calculation of OEE with Example

 OVERALL EQUIPMENT EFFECTIVENESS (OEE)

• It is a measure of how well a machine is performing as compared to its capacity during scheduled runs.

• It is a measure of how well a manufacturing operation is running.

• It measures the effectiveness of manufacturing operation in order to improve the process and increase productivity.

• It is the calculation made by SEIICHI NAKAJIMA in 1960's in Japan.

• It helps to identify a problem and losses in manufacturing operations.

• It is the best practice to improve the performance of machines and manufacturing operations.

• It is measured in percentage (%).

• It focuses on continuous improvement process.

• It is expressed as OEE = A×P×Q , where A → AVAILABILITY, P → PERFORMANCE and Q → QUALITY.

• If OEE > 85% means the equipment is performing on a WORLD CLASS LEVEL.

CALCULATION OF OEE WITH EXAMPLE

As OEE = AVAILABILITY × PERFORMANCE × QUALITY 

AVAILABILITY = (Available Time − Downtime) ÷ Available Time 

where Available Time = Total Time − Planned Downtime

Planned Downtime = Time Lost in Lunch Breaks, Meetings and any other Regular Scheduled Breaks. 

Downtime = Time Lost in Breakdowns, Repairs, Changeover, Adjustments, Setup etc.

PERFORMANCE = (Running Time − Performance Loss) ÷ Running or Operating Time

OR 

PERFORMANCE = (Standard Cycle Time × Quantity of Product Produced) ÷ Running or Operating Time

where Performance Loss = Time Lost Due to Reduced Speed, Long Cycle Time, Minor Stoppage.

Running Time = Total Time − (Planned Downtime + Downtime)

QUALITY = (Productive Time − Quality Loss Time) ÷ Productive Time 

OR

QUALITY = (Total Quantity Produced − Defective Quantity) ÷ Total Quantity Produced

where Quality Loss Time = Time Lost Due to Quality Issues.

Productive Time = Total Time − (Planned Downtime + Downtime + Performance Loss)

Example: If a shift in a factory is 8 hours long and Time given for Lunch Break is 40 minutes. Time lost in breakdowns and changeover are 70 minutes. Time lost due reduced speed is 80 minutes and time lost due to quality issues is 20 minutes. Calculate OEE?

Solution:

Given

Total Time = 8 hours = 8 × 60 minutes = 480 minutes

Planned Down Time = 40 minutes

Down Time = 70 minutes

Performance Loss = 80 minutes

Quality Loss Time = 20 minutes

Now, 

Available Time = Total Time − Planned Downtime = 480 − 40 = 440 minutes

Running Time = Total Time − (Planned Downtime + Downtime) = 480 − (40 + 70)

                         = 370 minutes

Productive Time = Total Time − (Planned Downtime + Downtime + Performance Loss)

                            = 480 − (40 + 70 + 80)

                            = 290 minutes

AVAILABILITY = (Available Time − Downtime) ÷ Available Time = (440 − 70) ÷ 440

                            =  0.84

PERFORMANCE = (Running Time − Performance Loss) ÷ Running Time

                               = (370 − 80) ÷ 370

                               = 0.78

QUALITY = (Productive Time − Quality Loss Time) ÷ Productive Time 

                   = (290 − 20) ÷ 290

                   = 0.93

OEE = AVAILABILITY × PERFORMANCE × QUALITY

         = 0.84 × 0.78 × 0.93

         = 0.61

         = 0.61 × 100 ( To be converted into percentage)

         = 61%

OEE is 61% which is not up to the mark, needs improvement in manufacturing operations.