How to calculate OEE in lean manufacturing?

What is OEE?

The full form of OEE is overall equipment effectiveness. It is a term used for measuring productivity in the manufacturing process. It is to calculate the percentage of time that is truly productive.

OEE
OEE

There are three factors for calculating OEE. These are Availability, Performance and Quality. Let’s understand each one as below:

Availability:

It is the percentage of time equipment is available for production out of the total available time. It means that if there is a breakdown in the equipment, then that will be subtracted from the total available time.

Availability = (Total available time – Breakdown time) / Total available time *100

Performance:

It is the performance of equipment and ( Operator ) as per defined cycle time. For calculating performance there can be effects of slow cycle time and small stoppages.

Performance = Production Quantity / ( Net available time * Cycle Time )*100

Quality:

It is the percentage of good quality products produced out of total production. Good quality products are total rework and rejection subtracted from total production.

Quality = Total OK Products / Total Production *100

OEE is the product of Availability, Performance and Quality.

OEE = Availability x Performance x Quality

6 Big Losses:

There are 6 big losses in the manufacturing process. For calculating OEE, we have to calculate all these losses.

  1. Unplanned stops ( Equipment brakdown)
  2. Planned stops ( Setup and adjustments)
  3. Small stops ( Minor stops)
  4. Slow cycle ( Reduced speed)
  5. Production rejects ( Process defects)
  6. Startup rejects ( Reduced yields)
6 big losses in oee,oee

Example of calculating OEE:

Calculate OEE by considering a shift of 8 hrs, Machine breakdown of 30 minutes, Total production of 3800 parts and rejection of 20 parts and target as per cycle time is 4000 parts.

Availability = (Total available time – Breakdown time) / Total available time *100

Availability = ((480 – 30) / 480)*100 = (450 / 480)*100 = 93.75%

Performance = Production Quantity / ( Net available time * Cycle Time )*100

Performance = (3800 / 4000) *100= 95%

Quality = Total OK Products / Total Production *100

Quality = (3780 / 3800) *100 = 99.47%

OEE = Availability x Performance x Quality

OEE = 93.75% x 95% x 99.47% = 88.59%

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