OEE stands for Operational Effectiveness Evaluation, and it is a process that measures the overall efficiency of a company’s production, operations, and processes. Using the data gathered, you can identify areas where you are losing money and inefficient, and start to make changes.
The standard on OEE
OEE is one of the key performance indicators (KPIs). The list of KPIs is quite wide, and you can find the main KPIs for manufacturing in ISO 22400-2:2014 Automation systems and integration – Key performance indicators (KPIs) for manufacturing operations management. This standard has already been implemented in Ukraine, and Ukrainian companies have begun to use it more actively in production and develop systems for effective calculation of this indicator.
OEE is considered to be one of the most comprehensive KPIs, as it transparently demonstrates the condition and utilization of equipment.
Overall Equipment Effectiveness (OEE) is an integrated indicator of equipment performance designed to monitor and improve production efficiency and based on the measurement and processing of specific production indicators.
An important stage in the implementation of OEE is the accuracy and timeliness of measurement, which depends on properly implemented processes and staff responsibility. To avoid manipulations with such an important indicator, it is recommended not to base staff compensation on KPIs, and to thoroughly train staff in the process of implementing KPIs in production.
Calculating OEE
In the manufacturing industry, OEE or overall equipment effectiveness is a great tool to measure how well a machine is performing. It can help manufacturers to determine the level of productivity of a production line, as well as identify problems that may be inhibiting the efficiency of a manufacturing process.
OEE is calculated using a mathematical formula based on three factors: performance, quality and availability. Quality is the number of items that meet certain quality control standards. Performance is the percentage of throughput the machine produces compared to its capacity. Availability is the amount of time that the manufacturing process is running, including setup and breakdown.
Using the OEE, a company can calculate how much loss in production is associated with specific stops. Whether they are planned or unplanned, these downtimes can cause a company to lose valuable production time and cost the company money.
The OEE is also used as a benchmark. Many companies set a target OEE to measure whether or not they are on track with their goals. A common target is 85%.
Measurement of Availability, Performance, and Quality
Availability, Performance, and Quality are three important metrics used in manufacturing to measure and monitor the efficiency of the manufacturing process. However, when determining the appropriate metric for your production process, there are several variables to consider. Ultimately, your decision will depend on the time frame.
Availability is the percentage of time your machine is running during planned production. The formula for calculating the availability metric is as follows: Total Run Time divided by Planned Production Time.
Performance measures small stops and a variety of production speed variations. This includes idle time, production speed, and speed of changeover. A low performance score could mean issues with specific parts or preventive maintenance tasks. It also includes quality losses such as rework, repair, and scrap.
Depending on how you calculate your availability, performance, and quality, you may be able to determine what maintenance activities are costing your company money. Using OEE analysis, you can find out where your most valuable resources are going, how you can reduce downtime, and how to avoid costly problems in the future.
In general, overall equipment effectiveness (OEE) is the standard for measuring how effective your manufacturing process is. You can compare it to other processes to identify where you should focus your efforts. Overall Equipment Effectiveness is calculated from three underlying factors, including Availability, Performance, and Quality. Availability is the first component, Performance is the second, and Quality is the third.
Availability is the most complicated of the three metrics. You can calculate the availability metric by dividing the actual runtime of your production machinery by the planned production time.
Having a high OEE means you are operating at the maximum possible speed, and that you are not stopping production. Generally, the quality portion of the OEE metric refers to the number of good units produced as a percentage of the total units started.
Identifying losses, inefficiencies, and progress
The OEE (Overall Equipment Effectiveness) metric is a good way to measure plant performance. It provides a standardized framework for evaluating the efficiency of a manufacturing operation. Using the metric can help identify any manufacturing deficiencies, whether they are technical or managerial.
OEE can be used to monitor production at the departmental level or to compare performance across multiple facilities. Calculating the metric can give managers insights into the quality, speed, and availability of production. However, the metric should be applied to the right parameters to get the most useful data.
One of the key benefits of the metric is that it provides a clear benchmark for progress and improvement. Similarly, a high score on the metric will let you know if you are making the most of your assets.
Overall equipment effectiveness can also be a helpful way to assess the performance of an individual work center, a machine, or a whole production line. By tracking performance in a given facility, you can improve productivity and boost profits.
Finding the best-fit OEE solution for your business
OEE software is a tool that allows businesses to visualize and analyze their production data in real-time. With the help of this solution, businesses can quickly identify and fix their issues.
To unlock efficiency gains in production, companies must be able to detect and avoid unplanned downtimes. Breakdowns are the most common challenge that companies face. It includes things like equipment failures, material shortages, and setups and adjustments.
While tracking performance with OEE software can be useful, manufacturers need a better way to understand and extract insights. Choosing a solution should be based on the needs of the business. A better technology provider should focus on data quality and listen to operational goals. Lastly, the solution must deliver the information in an easy-to-understand format.
Some OEE solutions offer only a limited palette of pre-configured calculations. This can limit customization of the solution. Companies also need to be sure that the software will be able to integrate with other business systems.
Among the products that Ukrainian companies can offer to improve the OEE indicator is the Smart EAM product from IT-Enterprise.
