What is OEE?

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What is OEE?

OEE stands for Overall Equipment Effectiveness. It is a technique used to visualize and reduce the amount of downtime of a production machine. OEE was described as a central component of the TPM methodology in 1982. Total Productive Maintenance is a concept that was introduced in 1971 by Japan’s Institute of Plant Maintenance.

There is no real standard describing how the OEE value should be calculated. So when starting with the OEE methodology there can be a lot of discussion about calculations. We recommend to look at for further clarification on this subject.
In most situations you are not solely looking to OEE but also to OEE Solitaire, OOE, TEEP and OEE Top (see below). Depending on your point of view, these values will give you the required insight for your decisionmaking.

OEE calculations

The following graph shows the different calculations:

The calculation of OEE consists of 3 parts:
• Availability = Production time / Loading time
• Performance = Actual output / Production time
• Quality = Good output / Actual output

So OEE = Availability * Performance * Quality , or in other words “Good products produced / expected number of products produced during the loading time”.

For each product/machine combination the expected number of products will be established (machine rate). During production all downtimes will be recorded. At the end or during a production run the number of parts produced and the number of rejected products will be registered.

Based on these number, the OEE can be calculated. Below you see an example of this calculation:

OEE Definition

source: https://OEE.Coach

OEE Coach Effectivity

Example OEE Calculation

This overview quickly identifies losses. The best approach to start with continuous improvement depends on a lot of factors.
A few examples:

• The quality loss only shows the time lost due to defective products. The report doesn’t tell what the cost of defective products is.
• When reducing downtimes, strategic considerations are important. For example if a machine is no bottleneck and a large part of downtime is caused because there are no orders then reducing downtime for specific reasons (change over, machine break) will only change the cause of the downtime, it might change the OEE for that machine but it has no effect on the OOE.
• Increasing the lot size will improve the OEE because you need less changeover but it will also lead to more stock in the warehouse which is almost always a bad result.

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