OEE is an acronym which stands for Overall Equipment Effectiveness. It is a metric widely used in many manufacturing/process industries alongside other techniques such as Failure Mode & Effect Analysis (FMEA), Layer of Protection Analysis (LOPA), Hazard Analysis & Operability (HAZOP) study, Bow Tie Analysis (BTA) and many others. While LOPA, HAZOP & BTA are specifically used in process safety engineering, and FMEA used in product management or say, product development, OEE is used in process improvement. It is an important metric which helps to determine how often equipment is available for work, how well the equipment does when it’s running, and how many quality products the equipment produce per cycle.
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OEE is measured in percentage (%), calculated as the product of availability, performance, and quality. It is a model having its root in total productive maintenance (TPM), and serving as a useful framework for improving process operations and achieving greater efficiency on the shop floor. An OEE score of 100% means you are producing or manufacturing only Good Parts (quality), as fast as possible (performance), with no Stop Time (availability). What that means is 100% Quality (only Good Parts), 100% Performance (as fast as possible), and 100% Availability (no Stop Time).
Overall Equipment Effectiveness (OEE) is an important technique for:
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The OEE score shows the overall health of your process, but doesn’t necessarily tell you where you should focus your improvement efforts. The three elements of OEE which are Availability, Performance, and Quality are what indicate where your process improvement efforts should be focused on.
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Combining points 8 – 10, results in
OEE = Availability × Performance × Quality (i)
If the equations for Availability, Performance, and Quality are substituted in the above and reduced to their simplest terms, the result is:
OEE = (Good Count × Ideal Cycle Time) / Planned Production Time (ii)
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Equation (i) requires values for Availability, Performance and Quality for calculation which can be gotten from point 8 – 10 accordingly, while equation (ii) can be calculated directly given values for each of the parameters (i.e. good count, ideal cycle time and planned production time). Equation (i) is the preferred method of calculating OEE because it captures how well your process is running (OEE) and provides insight into the three values that capture the fundamental nature of the losses associated with your process - Availability, Performance and Quality.
Olanrewaju, Adebayo Bamidele is a Lead Auditor of ISO 9001, FSSC 22000 / ISO 22000, 14001 & 45001 Management Systems, Certified Six Sigma Master Black Belt (CSSMBB), process engineer, and quality management professional with strong working experience and proven skills in manufacturing excellence, ISO management systems implementation, lean / digital manufacturing, and project management.
Adebayo is a Corporate Member of American Institute of Chemical Engineers (AIChE), Associate Member, the Institution of Chemical Engineers (IChemE), Corporate Member, Nigerian Society of Engineers (NSE), Corporate Member, Nigerian Society of Chemical Engineers (NSChE), Associate Member, Nigerian Institute of Management (NIM), and Associate Member, Institute of Strategic Management of Nigeria (ISMN).
He is an author of over 15 books and has published over 45 online courses on various e-learning platforms including Udemy, Alison, Learnformula & Study Plex.
You can reach him, here.