Overall Equipment Effectiveness (OEE).

An ideal situation is when in a factory equipment would operate 100 percent of the time at 100 percent capacity with an output of 100 percent good quality products.  In real life such situations do not happen.

Losses are the reason between the ideal and the actual situation.  It is crucial to calculate the overall equipment effectiveness rate to reduce equipment-and-processes related wastes through "Total Production Maintenance"(TPM), and with other methods like "Operational Excellence","Six Sigma",  or "World Class Manufacturing".

 What are the 'elements' in OEE?

 Downtime, speed loss, and defect or quality loss are the three main categories of equipment related losses.  These are also the main ingredients for determining OEE.  The OEE is calculated by combining the three factors that reflect these losses:

• The Availability rate
• The Performance rate
• The Quality rate.

Availability Rate is the time the equipment is really running versus the time it could have been running.  A low available rate reflects downtime losses: a) equipment loss, b) set-up and adjustments

            Available Rate = Operating time - downtime / Total operating time                                               

Performance Rate is the quantity produced during the running time versus the potential quantity, given the designed speed of the equipment.  A low performance rate reflects speed losses: a) idling and minor stoppages, b) reduced speed operation 

            Performance Rate = Total output / Potential output at rated speed                            

Quality Rate is the amount of good products versus the total amounts of products produced.  A low quality rate reflects defect losses: 1) scrap and rework, 2) start-up losses

            Quality Rate = Good output / Total output                                     

OEE is calculated by multiplying the three factors together:  OEE = availability rate x performance rate x quality rate.

The purpose of OEE is to improve the effectiveness of the equipment.  Since they affect the shop floor employees more than anybody else, it is necessary for them to get involved in tracking OEE and in planning and implementing equipment improvements to reduce effectiveness loss

How OEE benefits the operators and Shifts In-charge or the line managers:   

It is good for the operators to collect daily data about the equipment for use in OEE calculation.  This will   

• teach operators about the equipment,
• focus the operator’s attention on losses,
• help grow a feeling of ownership of the equipment.

The data will also give the line manager or Shift In-charge

• basic facts and figures on the equipment,
• he can give better feedback to the operators and others involved with the equipment improvement,
• helps him keep the management informed about the equipment status and improvement results.

There is, no doubt, OEE improves productivity on all fronts.

Questions:

• What are the three elements in OEE and explain their functions?
• How does OEE helps the operators and shifts in-charge or the line manager?