What is OEE?
OEE is an abbreviation of “Overall Equipment Effectiveness”. In a nutshell, it’s a Key Performance Indicator used to evaluate the efficiency of a manufacturing process. OEE was initially developed in Japan and is just part of the larger Total Productive Maintenance manufacturing philosophy, that was the backbone of the Japanese manufacturing revolution in the 1960, and ever since.
In its simplest terms, OEE provides a numerical measure of how well equipment is utilised and how efficiently it performs its intended functions. That numerical value, OEE, is typically calculated as a percentage and takes into account three essential components:
Availability
Performance
Quality
All of the above components are then simply multiplied together to give the Overall Equipment Effectiveness, i.e. a measure of the effectiveness of a manufacturing machine or process.
Availability:
Most texts on OEE will define Availability as a measure of the percentage of time that a printing machine is available for production, though I feel that this is quite ambiguous.
It can also be defined as the ratio of Run Time to Planned Production Time, and in simple terms this means the ratio of how much time the machine is running, supposedly producing good product, against the total time the machine is scheduled for production.
If your machine is manned for an 8 hour shift but the machine is only effectively Running (ie producing saleable product) for 2 hours during that shift than the Availability is calculated as Run Time / Scheduled Time = 0.25, or it is said to have 25% Availability.
The other 75% of the time is classed as Availability Loss, and typically, maybe without knowing the OEE terminology, this is what every astute production manager is trying to reduce. Availability Loss can be Planned Stops, such as Job Setup or Reel Changes, or availability loss can be from Unplanned Stops such as Web Breaks or Breakdowns. Anything that eats into and reduces your Run Time is an Availability Loss, and should be a target for improvement.
Performance:
Performance evaluates the speed at which the equipment operates compared to its maximum running speed. Once again, this definition is quite generic and does not lend itself well to an understanding on web printing machines.
Most texts on OEE refer to cycle times and takt times, whereas almost every web printing company I have ever visited measures press running speeds in metres per min or feet per minute. Sometimes the measurements are in metres or feet per hour, but in all cases, they are ‘linear’ material measurements and not cycle times.
The important thing to grasp here, is that it does not matter. Performance is a relative measure. To get a performance value simply ask yourself, how fast are we producing good product compared to how fast we could possibly produce it?
Quality:
Quality in OEE is a measure of good quality product produced as a proportion of all the product produced. Its simply calculated as Good Product / Total Product.
In printing companies, no one measures Quality, but almost universally, the measure of concern is Waste, and that is calculated as Waste Product / Total Product.
So, what’s the big deal. Waste is the inverse of Quality and it’s a very significant measure so why use Quality as a production metric?
Well, this is where the ‘Magic’ of OEE all comes together.
OEE
The formula for calculating OEE is given as … OEE = Availability × Performance × Quality
Each of these three components Availability, Performance and Quality all carry their own information about the production process in question and about where its not performing as well as it should.
Each of these three components is expressed as a percentage of ‘perfect’, and when multiplied together, they provide a value which represents the Overall Equipment Effectiveness.
An OEE score of 100% means you are manufacturing only good parts, as fast as possible, with no stop time.
Any reduction from this ideal 100% figure then can be broken down into losses in the appropriate areas of Availability, Performance or Quality. Further investigation can determine in turn determine why your company has Availability Loss, Performance Loss or Quality Loss.
This seemingly simple three part analysis focuses production management’s attention on the largest loss contributing elements of production. This in turn can have profound implications of productivity and profitability of an organisation.