What is Overall Equipment Effectiveness (OEE)?

Quick Definition

OEE is an abbreviation for the manufacturing metric Overall Equipment Effectiveness. OEE takes into account the various sub components of the manufacturing process – Availability, Performance and Quality. After the various factors are taken into account the result is expressed as a percentage. This percentage can be viewed as a snapshot of the current production efficiency for a machine, line or cell.

OEE= Availability x Performance x Quality

Expanded Definition

Manufacturing a product is a complex process. Without metrics and guidelines it is very easy to lose control and have your business managed by your production. OEE is a tool that combines multiple manufacturing issues and data points to provide information about the process. By analyzing and calculating data it also functions as a framework for root cause analysis. Through a documented process of combining the underlying data OEE provides specific process information. All members of the manufacturing team, from assembly technicians to financial personnel can use the data to understand the current state of the manufacturing process. By having a predetermined framework of the impact of machine availability, performance and quality, OEE provides a framework to track underlying issues and root causes. OEE also provides a framework for improvements in the manufacturing process. By using key OEE concepts such as The Six Big Losses waste exposed by tracking OEE can be understood and efficiencies can be improved.

The components of this framework are:

• OEE
• Availability
• Performance
• Quality

OEE is a very simple metric to immediately indicate the current status of a manufacturing process and also a complex tool allowing you to understand the effect of the various issues in the manufacturing process and how they affect the entire process.

OEE= Availability x Performance x Quality

Availability refers to the machine or cell being available for production when scheduled. At the most basic level, when a process is running it is creating value for the end user. When a process is stopped, it's creating a cost with no associated value. Whether it's due to mechanical failure, raw materials or operator issues, the cell or machine is either producing or not producing. By comparing scheduled run time to actual run time, the availability component of OEE allows for a determination of lost production due to down time.

Performance is determined by how much waste is created through running at less than optimal speed. By comparing the actual cycle times against ideal cycle times, OEE allows for a determination of how much production was lost by cycles that did not meet the ideal cycle time.

Quality focuses on identifying time that was wasted by producing a product that does not meet quality standards. By comparing the quantity of good to reject parts the percent of time actually adding value by producing good product is exposed.

How Can OEE Help My Organization?

By itself, OEE only provides data about your manufacturing process. Companies that use OEE as a metric have found success when combining it with general lean manufacturing programs and also as part of TPM systems. When using OEE with these systems the benefits become significant:

• Directly tie production efficiencies to fiscal reporting
• Reduce investigation time for root cause analysis
• Shorten equipment ROI through increased utilization
• Decrease costs through waste elimination
• Increase customer satisfaction through quality improvement

OEE allows companies to pull separate business functions together with a single useful metric.

Vorne Products in OEE

Vorne visual displays provide real-time information to enhance productivity and create a true Visual OEE™ environment. We manufacture many products to support OEE both at the component level to measure specific OEE factors and advanced production monitoring systems to expose real-time Visual OEE™ data.

Visual OEE™ Display
PROBLEM	Our company has identified OEE as a great tool to enhance manufacturing performance. Our problem is implementing it.
STRATEGY	Visual OEE™ provides critical real-time OEE data to everyone involved from the plant floor to the boardroom. Visual OEE™ integrates more than 100 process variables to provide real-time OEE data and much more.
SOLUTION	The XL800 Alphanumeric production monitor display provides Visual OEE™ to all levels of the informational hierarchy. With just a couple sensors, the ideal cycle time and a time schedule you can collect and display real time OEE on your plant floor and over your network. Imagine seeing real-time OEE via a simple web browser!
Availability, Performance, Quality Percentage Display
PROBLEM	We want to focus on one specific OEE factor at a time but want the flexibility to display other variables in the future.
STRATEGY	XL Series production monitors are reprogrammable at any time to show any of the more than 100 process variables that are developed on-board.
SOLUTION	XL Series production monitors offer the greatest flexibility of any Vorne product. Choose the display output that best fits your needs – XL400 Large Digital display for extended view distances, XL600 Multi-line large digital displays for multiple variable display and XL800 Alphanumeric displays for virtually limitless display of production data.
Real-time OEE Variable Display
PROBLEM	We want to focus on one specific OEE factor such as downtime or run rate.
STRATEGY	Display last event and/or total accumulated downtime. Other focused displays can provide target count/actual count data, real-time run rate and much more.
SOLUTION	87 Series – Show downtime, rate, count and dozens more focused production variables. Add dynamic tri-color digits to display preset-based color change of process variables to supercharge improvement programs. XL400 Large Digital, XL600 Multi-line and XL800 Alphanumeric production monitors can show any combination of over 100 production focused process variables. Other features include the ability to push this information over your network via its integrated Ethernet communications.

Call us toll free at 1-888-DISPLAYS (1-888-347-7529) for a FREE OEE Pocket Guide. We wrote the web site on OEE – visit our resource web site www.oee.com. We have helped many companies enhance their manufacturing performance with Visual OEE™ and are happy to assist you.