What is OEE (Overall Equipment Effectiveness)?

OEE is a "best practices" way to monitor and improve the effectiveness of your manufacturing processes (i.e. machines, manufacturing cells, assembly lines). OEE is simple and practical. It takes the most common and important sources of manufacturing productivity loss, places them into three primary categories and distils them into metrics that provide an excellent gauge for measuring where you are - and how you can improve! OEE is frequently used as a key metric in TPM (Total Productive Maintenance) and Lean Manufacturing programs and gives you a consistent way to measure the effectiveness of TPM and other initiatives by providing an overall framework for measuring production efficiency.  

How to calculate OEE?

OEE is calculated as the product of its three contributing factors:

OEE = Availability x Performance x Quality


Availability= (Operating Time) / (Planned Production Time)

Availability takes into account Down Time Loss, which includes any Events that stop planned production for an appreciable length of time (usually several minutes – long enough to log as a trackable Event). Examples include equipment failures, material shortages, and changeover time. Changeover time is included in OEE analysis, since it is a form of down time. While it may not be possible to eliminate changeover time, in most cases it can be reduced. The remaining available time is called Operating Time.


Performance= (Total Pieces) / (Operating Time x Ideal Run Rate)

Performance takes into account Speed Loss, which includes any factors that cause the process to operate at less than the maximum possible speed, when running. Examples include machine wear, substandard materials, misfeeds, and operator inefficiency. The remaining available time is called Net Operating Time.


Quality= (Good Pieces) / (Total Pieces )

Quality takes into account Quality Loss, which accounts for produced pieces that do not meet quality standards, including pieces that require rework.

OEE analysis starts with Plant Operating Time; the amount of time your facility is open and available for equipment operation. From Plant Operating Time, you subtract a category of time called Planned Shut Down, which includes all events that should be excluded from efficiency analysis because there was no intention of running production (e.g. breaks, lunch, scheduled maintenance, or periods where there is nothing to produce). The remaining available time is your Planned Production Time. OEE begins with Planned Production Time and scrutinizes efficiency and productivity
losses that occur, with the goal of reducing or eliminating these losses. There are three general categories of loss to consider - Down Time Loss, Speed Loss and Quality Loss.

World Class OEE:

In practice, the generally accepted World-class goals for each factor are quite different
From each other, as is shown in the table:

OEE Factor
World Class
90.0 %
95.0 %

Of course, every manufacturing plant is different. For example, if your plant has an active Six Sigma quality program, you may not be satisfied with a first-run quality rate of 99.9%. Worldwide studies indicate that the average OEE rate in manufacturing plants is 60%. As you can see from the above table, a World Class OEE is considered to be 85% or better.

Clearly, there is room for improvement in most manufacturing plants! How about yours?

Example of OEE Calculation:

The table below contains hypothetical shift data, to be used for a complete OEE calculation, starting with the calculation of the OEE Factors of Availability, Performance, and Quality. Note that the same units of measurement (in this case minutes and pieces) are consistently used throughout the calculations.

Shift Length
480 min
Breaks (2 short breaks)
20 min
Meal Break
30 min
Down Time
40 min
Ideal Run Rate
10 pieces per minute
Total Pieces
Reject Pieces
200 pieces

Planned Production Time = (Shift Length – Breaks) = (480-50) = 430 minute

Operating Time = (Planned Production Time – Down Time) = (430-40) = 390 minute

Good pieces = (Total Pieces – Reject Piece) = (3500-200) = 3300 pieces

Availability = 390 / 43 = 0.9069 (90.69%)

Performance = (3500 / 390)/10 = 0.8974 (89.74%)

Quality = 3300 / 3500 = 0.9428 (94.28%)

OEE = 0.9069 x 0.8974 x 0.9428 = 0.7672 (76.72%)



Any Question?

If you have any question regarding this article you can comment below or you can contact us on mechanicalinventors@gmail.com

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