Calculate OEE

Overall Equipment Effectiveness (OEE) is a standardised efficiency calculation for production equipment (the best YouTube video on OEE is from 4.0 Solutions here).

OEE is the only KPI that can be used to compare effectiveness of different machines. For instance, one machine makes chain pins (a blade cuts rods to certain lengths) and another one makes chain links (more complex: batch, quince and shot peening processes). Calculating OEE for these machines allows comparison of efficiency of these machines, even though these are very different in their nature.

Additionally, due to standardisation of OEE it can be rolled up to ad-hoc groups. The number of machines can be grouped into OEE of a production line. The number of production lines can be grouped into OEE of an area. The areas' OEE can be grouped into a site. The site OEE allows the executives to understand the capacity of the sites.

So, Overall Equipment Effectiveness is one of the important metrics to assess “health” of the manufacturing operations. For accurate health assessment OEE must be calculated digitally and preferably on all levels of the business: cell (machine), production line, area, site.

Analysis of OEE components helps identify problematic areas to target for efficiency improvements. If any of the components is low it indicates the following:

• Low Availability: maintenance issue, engineering issue, OEM issue

• Low Quality:  tooling issue, raw material issue

• Low Performance: operational issue, incorrect rates