What is OEE and how can you implement it in your manufacturing?

Overall Equipment Effectiveness (OEE) identifies the percentage of the planned production time that really is productive and calculates the efficiency of a given production. OEE is a prime key performance indicator that can optimize your manufacturing. It is a clear motivational tool for both management and floor employees. Optimal utilization of OEE can significantly enhance production lines in many industries. In this blog post you will learn more about how to calculate OEE and get a better understanding of how implementing OEE-software in your production can optimize your manufacturing process. To optimize the OEE value, eliminating all kinds of losses that may arise in production is a necessity.

What is OEE and how do you calculate OEE?

OEE is a KPI that describes the ratio of fully productive time to planned production time or, in other words, your production’s overall effectiveness. A high OEE value means that the equipment’s full capacity is utilized to a large extent. OEE consists of 3 factors: Quality, Performance and Availability. OEE describes the process of producing good products (Quality) as fast as possible (Performance) with a minimum of downtime (Availability). Learn more on what OEE is and how to define it. OEE is described through percentage with a maximum value of 100%. An OEE value of 100% depicts perfect manufacturing under ideal conditions:

  • 100% quality (no defective products or parts that need reworking)
  • 100% performance (no speed losses during production at all)
  • 100% availability (no downtime during production at all)

Quality A score of 100% quality reflects no defective or scrapped products. Any product or part that is defective or needs reworking is to be left out of the calculation. Whenever a product does not meet the quality standards the quality score will decrease, resulting in the OEE to decrease as well. Performance Speed losses will naturally affect the effectiveness of the production. When performing at 100%, the production runs at optimal and maximum speed at all times. Small stops in production will reduce the actual production time compared to the ideal production time. Availability Stops that affect the production for a long enough time are considered downtime. Downtime can be caused by many factors such as technical failures or shortages of raw materials. A non-producing manufacturing line causes increased costs without yielding any value. Availability looks at planned manufacturing time compared to actual manufacturing time.

Calculating OEE

OEE is calculated by multiplying the three factors, Quality, Performance and Availability.

OEE = Quality x Performance x Availability Each factor can be calculated as shown below.

Quality = good products manufactured / total products manufactured Good products manufactured are all products that meet the quality standards.

Performance = (optimal cycle time x total products) / actual run time Optimal cycle time is the minimum time required to manufacture one product.

Availability = actual run time / planned run time Actual run time is the downtime subtracted from the planned run time.

Understand and utilize OEE

It is important to stress that even though industries vary, OEE is a universal tool for measuring production effectiveness and identifying potential areas for improvement. In order to successfully implement OEE in your manufacturing, you need to fully understand OEE. Being able to understand the data and utilize OEE effectively means being able to see where and what can be optimized. Understanding how OEE will bring value into your production and utilizing that understanding can improve your production significantly. OEE is effective in pointing out where a specific loss is happening and thereby offers the possibility to act upon it by applying the right tools. OEE is a tool that can be utilized by management to shed light on manufacturing KPIs, as the OEE score can be used as a strategic goal for the business. OEE serves as a motivational factor for production employees to work more efficiently, thus enhancing production. Implementing OEE software in your production requires several considerations:

  • What is your current situation and needs?
  • How and at what level should OEE be implemented?
  • What are your expectations of the OEE software?

Read more about what to consider when choosing an OEE software.

OPTIWARE (AXXOS OEE) can improve your OEE

When implementing OEE-measuring, OPTIWARE (Aptean or we) can provide you with software for monitoring, analyzing, visualizing and improving OEE in your production. With AXXOS OEE you will be assured a reliable and high-quality software system that will give you the full picture of how effectively your production is running – and provide a solid foundation for improvements! The Production Monitoring Solution has a strong focus on follow-up and optimization and includes many benefits:

  • Minimize efforts to follow up production performance
  • Be ready for Industry 4.0 – Get digital
  • Increase and secure output
  • Quick return on investment
  • Improve productivity
  • Improve quality
  • Get the facts
  • Full control

Book a web demo and get in touch with one of our specialists to learn more about our AXXOS OEE solution and how this improvement-focused solution fits your specific needs.