The equipment you use to build your products plays an integral role in production, and if anything isn't delivering high-quality results it can drag down your entire operation. Thankfully, there's a formula that can help you measure overall equipment effectiveness (OEE) so you can more easily manage your factory floor. OEE allows you to measure the quality of your production process and makes it easy to see how much room you have for improvement.
How does OEE help production?
By measuring the OEE, you will know how well various processes are working. The OEE score paints a clear picture of the quality of parts being produced, the time it takes to make them and down time. Ideally, you want a score of 100 percent, because this means the equipment is turning out only good products as quickly as possible, and there is no down time during production, according to LeanProduction.com. While it's good to aim for this benchmark, odds are you won't achieve 100 percent compliance, which is why an OEE score of 85 percent is a solid goal to set for your company. Most companies that are already making lean manufacturing efforts can expect a score around 60 percent, while you may find you're only operating at 40 percent if you're just starting to make changes. The source pointed out that while this number is low, you can target and repair problems such as down time that will help bring the score up rapidly.
How do you calculate OEE?
To determine OEE, you need to multiply three different factors – availability, performance and quality, so your formula will look like this: OEE = Availability x Performance x Quality. Each factor in the equation is designed to pinpoint issues like down time, speed loss and quality loss. They can be determined by comparing the actual and the ideal with the following equations.
- Availability = Operating time / Planned production time
- Performance = Ideal cycle time / (Operating time / Total pieces)
- Quality = Good pieces / Total pieces
For the best results, you should calculate the OEE score of the process's constraint point. By honing in on a bottleneck in your production, you'll be able to make positive changes that will affect the entire operation.
What other factors should you consider?
The OEE equation can also be looked at as OEE = (Good pieces x Ideal cycle time) / Planned production time, which is essentially measuring the amount of quality pieces that can be produced in maximum theoretical speed and comparing it to the ideal output. A ratio of 1:1 would be ideal, as you'd be doing exactly what you set out to do. However, you need to take external factors into consideration, such as employee productivity levels, inventory stock-outs and equipment malfunctions.
Vorne Industries pointed out that it's important to include changeovers when accounting for availability, as the amount of time it takes to replace operators between shifts could be an area of improvement, but you won't know if you don't factor it in. It's also important to look at the number as a guide to help you make improvements rather than simply tracking the number itself. If your score is lower than you'd like, you'll have to circle back to the availability, performance and quality metrics to determine which could stand to be improved upon. From there you'll be able to strategize options that can bring up the OEE.
When it comes to lean manufacturing, every aspect of operations plays an important role, from reducing lead times and managing inventory to quality control and equipment effectiveness. By paying close attention to OEE on your factory floor, you'll be able to pinpoint problem areas and address issues that could be dragging down your score.