TEHNOMUS - New Technologies and Products in Machine Manufacturing Technologies

A REVIEW OF OVERALL EQUIPMENT EFFECTIVENESS

Gavriluță Ana1
1
University of Pitești, Manufacturing and Industrial Management Department
e-mail: [email protected]

Abstract: The Overall Equipment Effectiveness (OEE) calculation is a metric that gives us
daily information about how effectively the machine is running and which of the six big losses
we need to improve. Overall equipment effectiveness is not the only indicator to assess a
production system, but it is certainly very important if our goal is improvement. OEE is
sometimes referred to as Utilization and is the percentage of your total productive capacity that
you are actually using. The aim of this paper is to make a review on the method of calculus of
the equipment performance indicator, Overall Equipment Effectiveness

Keywords: Overall Equipment Effectiveness, capacity, system.

1. Introduction
OEE is a "best practices" way to monitor “bottleneck” equipment run more effectively.
and improve the effectiveness of your OEE and its individual factors will give the
manufacturing processes. OEE is simple and plant numbers to see where the equipment is
practical. It takes the most common and loosing time, i.e. if it has much downtime or
important sources of manufacturing has speed losses or if the quality is poor
productivity loss, places them into three [Högfeld, 2005].
primary categories and distills them into The goal of measuring OEE is to improve
metrics that provide an excellent gauge for the effectiveness of your equipment. Since
measuring where you are - and how you can equipment effectiveness affects shop floor
improve! [Vorne, 2008]. employees more than any other group, it is
The first application of OEE can be traced to appropriate for them to be involved in tracking
the late 1960’s when it was used by Seiichi OEE and in planning and implementing
Nakajima at Nippon Denso as a key metric in equipment improvements to reduce lost
TPM. According to Nakajima, “TPM is a plant effectiveness. Let’s look at some of the
improvement methodology, which enables benefits of OEE measurement for operators
continuous and rapid improvement of the and shift leaders or line managers.
manufacturing process through the use of It’s recommend that the operator collect the
employee involvement, employee daily data about the equipment for use in the
improvement and closed-loop measurement of OEE calculation. Collecting this data will:
results.” [Brag, 2003] - teach the operator about the equipment;
Honda (2000) stated that OEE is a measure - focus the operator’s attention on the
of how well equipment or lines are utilized in losses;
relation to their full potential. OEE is based on - grow a feeling of ownership of the
the product of three individual factors, equipment.
Availability (Operating Rate), Performance The shift leader or line manager is often the
efficiency and Quality rate. The main objective one who will receive the daily operating data
to measure OEE is to make constraint or from the operator and process it to develop

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information about the OEE. Working hands on

with the data will;
- give the leader/manager basic facts and
figures on the equipment;
- help the leader/manager give appropriate
feedback to the operators and others
involved in equipment improvement;
- allow the leader to keep management
informed about equipment status and
improvement results.
One of the major goals of OEE is to reduce
Figure 1. The OEE losses
and/or eliminate what are called the Six Big
Losses – the most common causes of
efficiency loss in manufacturing, figure 1. The following table lists the Six Big Losses,
and shows how they relate to the OEE Loss
categories [Vorne, 2008].

Table. 1 OEE Loss Category

Six Big Loss OEE Loss Event Examples Comment
Category Category
Breakdowns Down Time Tooling Failures/Unplanned There is flexibility on where to set
Loss Maintenance/ General the threshold between a Breakdown
Breakdowns/Equipment Failure (Down Time Loss) and a Small Stop
Setup and Down Time Setup/Changeover /Material This loss is often addressed through
Adjustments Loss Shortages/Operator Shortages/ setup time reduction programs.
Major Adjustments/Warm-Up Time
Small Stops Speed Loss Obstructed Product Flow/Component Typically only includes stops that are
Jams Misdeeds/Sensor under five minutes and that do not
Blocked/Delivery Blocked/ require maintenance personnel.
Cleaning/Checking
Reduced Speed Loss Rough Running/Under Nameplate Anything that keeps the process from
Speed Capacity/Under Design Capacity/ running at its theoretical maximum
Equipment Wear/Operator Inefficiency speed
Startup Quality Scrap/Rework/In-Process Damage/ Rejects during warm-up, startup or
Rejects Loss In-Process Expiration/ Incorrect other early production. May be due to
Assembly improper setup, warm-up period, etc.
Production Quality Scrap/Rework/In-Process Damage Rejects during steady-state
Rejects Loss In-Process Expiration/Incorrect production.
Assembly

50% is often referred to as your “hidden

2. The OEE metric factory” – capacity that you really need, but
Overall Equipment Effectiveness (OEE) is can’t seem to find. A low OEE is often
a powerful metric that reflects the true responsible for overtime, additional shifts and
performance of your manufacturing cell. OEE the possible acquisition of unnecessary capital
is sometimes referred to as Utilization and is equipment. World-Class OEE is considered to
the percentage of your total productive be greater than 85-90%.
capacity that you are actually using. For OEE breaks the performance of a
example, if your OEE is 50% (which is manufacturing unit into three separate but
surprisingly common) your cell is theoretically measurable components: Availability - Av,
capable of producing twice as many acceptable Performance – Perf, and Quality - Q.
parts as it currently making. The remaining Overall Equipment Effectiveness (OEE) is
a powerful metric that reflects the true

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performance of your manufacturing cell. OEE Loading time = Total Available Time -
is sometimes referred to as Utilization and is Planned Downtime
the percentage of your total productive
capacity that you are actually using. For The Performance Efficiency - Perf takes
example, if your OEE is 50% (which is into account the unrecorded downtime. That is
surprisingly common) your cell is theoretically the third and fourth of the 6 Big Losses, all
capable of producing twice as many acceptable unrecorded downtime, i.e. short stoppages,
parts as it currently making. The remaining usually less than 5-10 minutes and losses due
50% is often referred to as your “hidden to the difference between ideal cycle time and
factory” – capacity that you really need, but actual cycle time.
can’t seem to find. A low OEE is often To be able to calculate the performance
responsible for overtime, additional shifts and efficiency an ideal cycle time for the job
the possible acquisition of unnecessary capital running at the machine is needed. If the ideal
equipment. World-Class OEE is considered to cycle time is multiplied with the total parts
be greater than 85-90%. produced the outcome will be the time it
OEE breaks the performance of a should have taken to produce the parts. To
manufacturing unit into three separate but calculate the performance efficiency the time it
measurable components: Availability - Av, should have taken is divided by the actual
Performance – Perf, and Quality – Q, figure 2. operating time.

OEE = Av × Perf × Q Perf = (Total Parts Run × Ideal Cycle Time)/

Actual Operating Time

The quality rate captures the last two of the

6 Big Losses; time loss due to the rejected
parts during production and the losses from
initial startup to process stabilization. The
Figure 2. The Basic Maths of OEE quality rate is calculated by dividing the good
parts produced by the total number of parts
The Availability - Av is a percentage produced.
number showing how the machine was
available when it was needed for production. It Q = (Total Parts Run - Total Defects)/ Total
looks at the first two of the 6 Big Losses, Parts Run
Breakdowns and Setup/Adjustments. That is
the downtime that is measured at the 3. Calculate the OEE metrics for a
equipment. Usually if the measurements at the production cell
equipment/machine are collected manually it
is times longer than 5-10 minutes. The production cell, analyzed in this study,
Availability is calculated by dividing the is designed to produce alternatively two
Actual Operating Time by the Loading Time. different types of products. Therefore, the
The actual operating time is the loading time monthly quantities required by the customer
minus the sum of all downtime losses while for the products are 320 products A and 640
operating, i.e. breakdowns and changeovers. products B.
The production cell works with reduced
Av = Actual Operating Time/ Loading time working week (5 days/week), in three shifts of
8 hours, with 30 minutes break per shift for the
operator to eat and rest.
Actual Operating Time = Loading time - The application of the OEE for this cell is
Unplanned Downtime presented in figure 3.

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Equipment ID: Production cell DATE 2.04.2017

Shift no/day 3
EQUIPMENT AVAILABILITY
A. Total Availability time 1440 mn
B. Planned Downtime 90 mn
C. Net Availability Time 1350 mn
D. Unplanned Downtime
# breakdowns 42 mn
# setup 10 mn
# mirror breakdowns 0
Total 52 mn
E. Operating Tme 1298 mn
F. AVAILABILITY - Av 96.15 %

EQUIPMENT PERFORAMNCES EFFICIENCY

G. Total parts run (goods and bad) 2400 sets
H. Ideal cycle time 0.5 mn/set
I. PERFORMANCES - Perf 92.45 %

QUALITY RATE
J. Total Defects 200 sets
K. QUALITY 91.67 %

OVERALL EQUIPMENT EFFECTIVENESS 81.48148148 %

Figure 3. Calculate the OEE for the production cell

OEE it is a great tool for showing where

biggest time losses are during production. In
the following I will present the OEE diagrams
where:
- the net operating time is the operation
duration from which it was subtracted
the MIA time;
- the valuable operating time is the net
operation time from which was
subtracted the time in of defect making.
Figure 5. OEE graph showing the time losses in
percent

4. Conclusions
Based on the wide spread and diverse
understanding and use of OEE, there are
several cautions regarding its use:
- The calculated OEE (OEE percentage)
is not intended for use as a corporate or
plant level measure. OEE percentage is a
rough measure of selected equipment
Figure 4. OEE graph showing the time losses in effectiveness only;
minute
- Calculated OEE is not valid for
comparing or benchmarking different
assets, equipment, or processes. OEE is a

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relative indicator of specific single asset

effectiveness compared to it self over a
period of time. However, OEE can be used
to compare like equipment in like situations
producing like products or output;
- OEE does not measure maintenance
effectiveness because most of the loss
factors are outside the direct control of the
maintainers;
- There appears to be no valid
specification of “world-class OEE.”
However, 85 percent OEE has been cited
frequently. Also, “maximizing OEE” may
not be justifiable. Optimum levels of OEE
largely depend on the capability or capacity
of the asset, the business demands, and
whether it is a constraint in the process
flow;
- OEE percentage calculations are not
statistically valid. A calculated OEE
percentage assumes that all equipment-
related losses are equally important and that
any improvement in OEE is a positive
improvement for the business. This is
generally not the case. OEE percentages
can actually improve while actual quality
losses increase significantly. OEE
percentages can actually decline while
output improves – efficiency and quality
losses are reduced and the same planned
output is generated in less time thereby
lowering the “availability” percentage.

4 References
1. [Vorne, 2008], The Fast Guide to OEE,
Vorne Industrie Inc, 2008. Available from
www.vorne.com.
2. [Brag, 2003], Bragg S., Implementing OEE,
ARC Insights, ARC Advisory Group, 2003
3. [Högfeld, 2005], Högfeld D., A value
stream mapping and overall equipment
effectiveness study, 2005

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