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What is Overall Equipment Effectiveness (OEE)?

OEE Defined

In manufacturing, Overall Equipment Effectiveness (OEE) measures the productivity of a machine. OEE compares the performance of a machine to its relative capacity, resulting in a score metric for a specific scheduled run.

Formula to calculate OEE

The formula used to calculate the OEE score of a machine multiplies the available of a machine by quality and performance. It’s represented as:

OEE = A x Q x P

OEE = Availability * Quality * Performance

Availability is the measured amount of uptime of a machine during the scheduled manufacturing run.

Availability = Uptime / Scheduled Run Time

Quality is the number of units produced in a scheduled run time that meet the quality control levels and do not possess defects, divided by the total number of units that are produced in that scheduled run time.

Quality = Acceptable Units / Total Units

Performance is measured as a percentage of throughput of the machine, compared to its actual overall capacity.

Performance = Throughput / Overall Throughput

Why measure OEE?

OEE measurements are a backbone of machine monitoring in manufacturing.

Monitoring the OEE of your machines gives you insight into your operations. This measurement allows you to identify weaknesses in processes, get ahead of maintenance or bottlenecks, and reduce non-value-added time.

Knowing your OEE at any given time provides data that can justify process changes or influence decisions, and allows you to be aware of the true capacity of your operations. This can enable you to set goals to maximize utilization of your machines.

The importance of setting OEE benchmarks

While it is unlikely that a given machine or process will run at 100% OEE, it is vital to keep track of it and set goals. It is common to set a goal of 80% to 90% OEE.

Utilizing historical OEE records also allows you to track improvements over time and have insight into changes made on the manufacturing floor. Because of the value in understanding OEE, it is typically considered a key performance indicator in manufacturing.

Quick overviews with OEE dashboards

OEE dashboards are manufacturing dashboards that display OEE in real-time. The goal of these production dashboards is to give the whole team a shared overview of operations.

Adding context to OEE with OPE

Often, the cause of a low OEE score won’t have anything to do with machine performance. Rather, low OEE can result from inconsistencies around a machine.

For this reason, many manufacturers choose to measure Overall Process Effectiveness (OPE).

OPE looks at the effectiveness of a complete process, accounting for human activity as well as machine runs. This provides a more holistic overview of production.