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In the competitive world of manufacturing, companies are constantly looking for ways to increase efficiency and productivity. One metric in particular that gained popularity in recent years is Overall Equipment Effectiveness (OEE). But what exactly is OEE and how does it work?
Before delving deeper into the topic of OEE, it’s important to familiarize oneself with the following key terms:
Fully Productive Time: This refers to the production time remaining after all losses have been deducted.
Planned Production Time: Planned production time is the total duration during which your equipment or system is anticipated to be in operation.
Ideal Cycle Time: The cycle time denotes the maximum production rate or the time required to produce a single unit.
Run Time: This is the period for which your system is set for production and is operational.
Total Count: This is the aggregate number of parts produced, including those with defects.
Good Count: A good count represents the number of parts produced that comply with quality control criteria.
Good Parts: These are the parts that meet standards and do not require any rework.
Quality: This term pertains to manufactured parts of the same equipment that fail to meet quality-control standards, including ones requiring rework. It is computed as Quality = Good Count / Total Count.
Performance: This takes into consideration the frequency of production slowdowns or brief halts. A perfect performance score in OEE terminology indicates your operation is functioning at its maximum speed. It is calculated as Performance = (Ideal Cycle Time x Total Count) / Run Time.
Availability: This accounts for all availability losses both planned and unplanned downtime. A perfect availability score implies your operation is continuously running during scheduled production times. It is computed as Availability = Run Time / Planned Production Time.
OEE is a metric that measures the efficiency and effectiveness of equipment utilization in a manufacturing process. It takes into account three key factors – availability, performance, and quality – to give a comprehensive view of how well a machine or production line is performing.
Machine availability refers to the percentage of time that a machine is operational and ready for production. It encompasses various factors such as unplanned downtime, scheduled maintenance activities, and changeovers between different production runs. These factors can have a significant impact on the overall availability of the machine and, consequently, the efficiency of the production process. By carefully managing and minimizing these disruptions, businesses can strive for optimal machine availability and maximize their productivity.
This metric evaluates the pace at which a machine is operating relative to its maximum capacity. Performance, in this context, considers elements like Slow Cycles and Small Stops. A Performance score of 100% implies that when the process is operational, it is running at its highest possible speed. Factors such as poor environmental conditions, slowdowns, stops, and defects can influence this performance, potentially reducing the machine’s output compared to its peak potential.
This metric reflects the number of good parts produced compared to the total amount of parts usable units produced together, providing valuable insights into the overall quality of units produced during the manufacturing process. Defects, rework, and scrap can significantly impact this metric, highlighting areas for improvement and emphasizing the importance of quality control measures. By closely monitoring and addressing these factors, organizations can strive for higher quality standards and ultimately deliver superior quality products back to their customers.
By combining these three factors, OEE provides a clear picture of the overall total effective equipment performance and effectiveness in a manufacturing process.
While OEE is an excellent resource for managers, it might be somewhat abstract for employees on the manufacturing floor. These employees perform optimally when provided with real-time, easily comprehensible and highly motivational objectives. An effective set of metrics for the manufacturing floor could be referred to as TAED:
Target: This is a real-time production goal driven by the anticipated production rate.
Actual: This refers to the actual production count.
Efficiency: This is the proportion of Target to Actual, indicating how far ahead or behind production is running in percentage terms.
Downtime: This is the cumulative unplanned stop time for the shift, updated in real-time, which maintains a strong focus on a key area for improvement.
With the rise of Industry 4.0 and smart factories, implementing OEE in planned production has become even more important for manufacturers. Here are some key benefits of using OEE in actual production throughput in a smart factory:
With the help of advanced sensors and analytics, production plant OEE and manufacturing productivity can be measured and tracked in real-time. This allows for quick identification of issues and proactive decision-making to optimize production.
Overall Equipment Effectiveness is a powerful metric that provides manufacturers with valuable insights into machine performance, downtime reasons, and quality issues. By meticulously analyzing this data, manufacturers can gain a comprehensive understanding of their production processes, identify bottlenecks, and make informed decisions to optimize efficiency, minimize downtime, and reduce waste. With OEE as a guiding tool, manufacturers can unlock untapped potential, drive continuous improvement, and achieve sustainable success in their operations.
By meticulously measuring all manufacturing equipment productivity and identifying and rectifying inefficiencies, OEE can significantly enhance productivity and throughput. This optimization leads to a remarkable increase in output, all while utilizing the same amount of resources. The systematic approach of OEE ensures that every aspect of the production process is thoroughly examined, allowing for targeted improvements that yield substantial gains in overall performance.
What is typically seen as a “good” OEE quality score? And what would be the ideal, “world-class” OEE score?
A flawless OEE quality inspection score of 100% represents optimal production: only manufacturing quality products, at the fastest rate, with zero downtime.
An OEE score of 85% is often regarded as world-class for discrete manufacturers. For numerous companies, this score serves as a viable long-term objective.
A fairly typical OEE quality score for discrete manufacturers is 60%. However, this score suggests that there’s significant potential for enhancement.
For manufacturers just beginning to monitor and track progress to elevate their manufacturing performance, an OEE score of 40% is not rare. While this score is on the lower end, in most instances, it can be readily improved by implementing simple measures. For instance, by identifying the reasons for stop time and systematically addressing the primary causes of downtime.
Before calculating overall equipment effectiveness, it’s critical to distinguish between the terms ‘effectiveness‘ and ‘efficiency‘ within the context of performance calculation of OEE.
Effectiveness is determined by comparing what a production system could theoretically yield and what it actually produces at the end of a production cycle. For instance, if your equipment can generate 100 products per hour but only produces 80, then its effectiveness stands at 80 percent.
However, this doesn’t provide insight into the machine’s efficiency, as factors like the number of operators, energy consumption, and materials required to achieve 80 percent effectiveness are not taken into account. For example, if your equipment operates at 60 percent effectiveness with one worker but labor efficiency improves to 75 percent with two workers, its effectiveness rises by 25 percent, yet its efficiency drops to 50 percent when labor is considered.
For companies looking to enhance their OEE performance, here are valuable tips to consider:
Regularly track and analyze OEE data to identify patterns and areas for improvement. By diligently monitoring OEE metrics such as availability, total productive maintenance, performance losses and quality, companies can pinpoint specific bottlenecks or inefficiencies that hinder their overall equipment effectiveness.
Implement predictive maintenance techniques to reduce unplanned downtime from equipment failure and improve availability. By leveraging advanced technologies such as condition monitoring and predictive analytics, companies can proactively identify potential equipment failures and schedule preventive maintenance activities at the most opportune times, minimizing disruptions and maximizing equipment uptime.
Invest in comprehensive training programs for employees to ensure they possess the necessary skills to operate and maintain equipment efficiently. Well-trained and knowledgeable employees can maximize equipment performance, troubleshoot issues effectively, and perform routine maintenance tasks, ultimately contributing to stable production and improved OEE.
Continuously monitor quality and address any issues promptly to reduce waste. By implementing robust quality control measures, such as real-time monitoring systems and quality assurance protocols, companies can identify and rectify any quality-related issues promptly. This helps minimize waste, rework, and scrap, thereby eliminating waste and optimizing OEE.
By implementing these strategies, companies can enhance their OEE performance, streamline operations, and drive greater productivity and profitability.
Generally speaking, Overall Equipment Effectiveness is an important metric for manufacturers who want to continuously improve their efficiency and productivity. By measuring and tracking OEE, companies can gain valuable insights into the performance of their production processes, so they’re able to identify specific areas that require improvement. This approach empowers manufacturers to address issues quickly, optimize their overall performance and improve manufacturing productivity, resulting in increased operational effectiveness and reduced downtime.
Shoplogix, a prominent provider of smart factory software solutions, assists manufacturers in enhancing their OEE performance relative to planned production time. With its advanced analytics and real-time monitoring capabilities, Shoplogix enables manufacturers to track and optimize OEE in their production processes.
So if you’re a manufacturer looking to stay competitive in today’s market, don’t overlook the power of OEE – it could be the key to unlocking your full potential. Go ahead, measure your OEE and start making data-driven decisions for maximum performance improvement!
