What Is OEE – Basic Of Overall equipment effectiveness

What Is OEE – Basic Of Overall equipment effectiveness

What is Overall Equipment Effectiveness?
OEE (Overall Equipment Effectiveness) is the gold standard for measuring manufacturing productivity. Simply put – it identifies the percentage of manufacturing time that is truly productive. An OEE score of 100% means you are manufacturing only Good Parts, as fast as possible, with no Stop Time. In the language of OEE that means 100% Quality (only Good Parts), 100% Performance (as fast as possible), and 100% Availability (no Stop Time).

Definitions Of OEE- Overall Equipment Effectiveness

OEE (Overall Equipment Effectiveness) can be defined as the ratio between theoretical production time for the actual good units produced and actual production time it took to produce these good units.

OEE % = Actual Good Units / Theoretical Good Units %


OEE (Overall Equipment Effectiveness) can be defined as the ratio between actual good output and theoretical good output for the actual production time.

OEE % = Availability X Performance X Quality %

OEE measurement is also commonly used as a key performance indicator (KPI) in conjunction with lean manufacturing efforts to provide an indicator of success.

Overall equipment effectiveness (OEE) Examples :

If for example the cycle time is reduced, the OEE will increase i.e. more product is produced for less resource. Another example is if one enterprise serves a high volume, low variety market, and another enterprise serves a low volume, high variety market. More changeovers (set-ups) will lower the OEE in comparison, but if the product is sold at a premium, there could be more margin with a lower OEE.

Meeting business targets by improving operational efficiency and sustainability requires measuring and monitoring Key Performance Indicators (KPI’s) to ensure plants operate at peak level and analyzing asset utilization for continuous improvement. Overall Equipment Effectiveness (OEE) is a KPI which has become the de facto industry standard to measure and monitor the effectiveness of operating production and packaging machines and lines. Using OEE leading manufacturers have:

  • Reduced equipment unscheduled downtime
  • Increased production throughput and quality
  • Minimized the impact of planned downtime
  • Improved schedule adherence and customer satisfaction

OEE is a very powerful metric. This KPI is calculated from actual equipment availability, performance and quality losses relative to maximum expected performance – essentially capturing when an asset is available, the speed at which it operates and the number of products out of quality specification.

Availability (%) = Operating Time / Available Time
Performance (%) = Total Production / (Target Production Rate x Operating Time)
Quality (%) = Good Production / Total Production

With real-time OEE visibility, you will be able to make ad hoc corrective actions quickly. Detailed historical data of equipment utilization enables root cause analysis of capacity losses to determine areas for improvement.

OEE Performance Analysis

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.

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 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 takes into account Quality Loss, which accounts for produced pieces that do not meet quality standards, including pieces that require rework. The remaining time is called Fully Productive Time. Our goal is to maximize Fully Productive Time.

6 Big Losses 

six big losses related to OEE
six big losses related to OEE

Sachin Thorat

Sachin is a B-TECH graduate in Mechanical Engineering from a reputed Engineering college. Currently, he is working in the sheet metal industry as a designer. Additionally, he has interested in Product Design, Animation, and Project design. He also likes to write articles related to the mechanical engineering field and tries to motivate other mechanical engineering students by his innovative project ideas, design, models and videos.

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