Many companies measure machine or process utilization, throughput, and quality, but fail to consider the combined effect of these on overall performance.
Overall Equipment Effectiveness (OEE) is a simple percentage that shows the ratio of actual equipment output to its theoretical maximum. OEE factors in equipment availability, speed performance, and quality, and is based on the premise that all production losses on machines and processes can be measured and quantified.
OEE is calculated using a simple formula:
The Availability accounts for unplanned downtime losses. It is equal to the actual machine/process running time divided by the total available time. Planned downtime events such as lunch breaks are not part of the OEE calculation.
The Performance accounts for speed loss. It is equal to the ratio of number of parts produced over the measurement period (shift, day, etc) to the theoretical maximum number of parts that could be produced if the machine or process ran at its highest possible speed. The performance calculation is simple when the machine or process produces one part per cycle. However, the performance calculation gets complicated when a machine produces multiple parts per cycle, and even more complicated when a machine makes varying numbers of parts depending on the job being run.
LETS has the unique ability to calculate an accurate OEE for operations where multiple parts are made during each machine cycle - even when multiple jobs making differing numbers of parts-per-cycle were run during the sample period. This makes LETS ideal for metal stamping and injection molding operations.
The Quality is the ratio good parts to total parts produced.
Here's an example: During an 8-hour shift with 1/2 hour for lunch and two 15-minute breaks, a machine has a maximum availability of 7 hours (420 minutes). If there were 82 minutes of unplanned downtime during the shift, then the machine would've actually run for 338 minutes. The availability would be calculated as follows:
Running at full speed, the machine is capable of producing 6000 parts/hour (or 100 parts per minute). During the 338 minutes of running time in our example, the machine made 25,000 parts. The performance percentage is calculated:
Out of the 25,000 parts produced, 500 had to be later scrapped. The quality percentage is the ratio of good parts to total parts, and is calculated as follows:
The OEE for this example is:
You can see that although the component measurements - 80% uptime at 74% of maximum speed with 98% quality - indicate an efficient process, when taken together as OEE, the process is really only 58% effective.
Why use OEE?