There are two ways to calculate OEE: a simple way and a more involved way. Put simply, overall equipment effectiveness (OEE) is a measure of how much quality product a facility makes during its planned productive time. The higher the score, the more quality product the facility makes (ie. 100% OEE means that 100% of all products made during productive time are quality). This seems like it might just be an interesting number to know, but it's actually an incredibly useful metric to gauge how effective and efficient your equipment is.
The simple calculation
The simple way of calculating OEE is to take an asset's actual production speed and measure that against the theoretical maximum production speed.
Let's say that in a 10 hour period (600 minutes), Asset A should be able to make 600 good products (or 1 good product per minute). This is the theoretical maximum speed.
In an actual 10 hour period, the machine makes 300 good products. This means that the OEE for that asset is 50% - the asset has only made about half its maximum quality products, meaning that it is 50% effective.
The preferred calculation: availability (A), performance (P), and quality (Q)
The preferred way of calculating OEE is more involved than the simple calculation because it includes the APQ of the asset: the availability, performance, and quality.
You might ask why there's two methods of calculating OEE. That's because the more involved way isn't just another way of measuring OEE. Instead, it's a way of understanding where that lost effectiveness is going or what part of the production process needs improvement. It is this method of calculating that makes OEE a useful diagnostic tool for inefficient equipment.
Essentially, APQ tries to figure out exactly why product is being lost:
- Availability: Are we losing product because the machine isn't running?
- Performance: Are we creating the right products at the best possible speed?
- Quality: Are we making good products and not needing to rework bad ones?
To calculate these:
To calculate availability, we need to look at the asset's run time divided by the actual planned production time (ie. how much did we run vs. how much did we plan to run).
To calculate performance, we need to look at our ideal cycle time multiplied by the total number of product, which gives us the fastest time to create product. Then, we divide this by the overall runtime of the asset.
To calculate quality, we need to divide the total number of good parts that we produced by the total number of parts we made overall. This gives us the general proportion of good vs. bad products.