How to calculate OEE, and the six most common mistakes
The product of availability, performance and quality; a step-by-step example on a 450-minute shift and six common mistakes that distort the OEE figure.
OEE (overall equipment effectiveness) says in one number how much of the planned time a machine turns into good product. The value of that number depends entirely on how it is calculated: two teams can get two different OEE figures from the same line. Let us look at the calculation first, then the mistakes.
Three factors
OEE = availability × performance × quality.
- Availability = run time / planned production time
- Performance = (ideal cycle time × total pieces) / run time
- Quality = good pieces / total pieces
Example
The shift is 480 minutes with a 30-minute planned break, so planned production time is 450 minutes. Unplanned stops total 45 minutes; run time is 405 minutes. The part has an ideal cycle time of 0.5 minutes (30 seconds); 700 pieces came out, 21 of them scrap, 679 good.
- Availability: 405 / 450 = 90.0%
- Performance: 0.5 × 700 / 405 = 86.4%
- Quality: 679 / 700 = 97.0%
- OEE: 0.900 × 0.864 × 0.970 = 75.4%
The largest loss shows up in performance (about 13.6%): the machine runs slowly or with short stops while it is "running". Someone who looks only at stop records misses that.
Six common mistakes
- **Counting planned breaks as losses.** Availability is calculated against planned production time. A calculation that puts calendar time (24 hours) in the denominator is a different measure (TEEP); do not mix the two.
- **Using a target cycle time instead of the ideal one.** The ideal cycle time is the design or proven best speed. If you enter today's average speed as "ideal", performance always comes out near 100% and the loss disappears.
- **Counting reworked parts as good.** A part that is not right the first time is a quality loss, even if it is salvaged later.
- **Not recording short stops.** Stops under a minute are usually forgotten in hand-kept records; the loss is pushed into performance, the wrong place. Decide the stop threshold up front.
- **Averaging OEE values.** Adding the OEE of three machines and dividing by three ignores run times. Sum the times and counts first, then calculate the ratios.
- **Burying performance above 100%.** If performance goes above 100, the ideal cycle time is defined wrongly; find the cause instead of clipping the result.
After the number
OEE is a starting point, not a diagnosis. Go deeper in the factor where the loss is: a Pareto of causes for stops, the cycle time distribution for performance, scrap causes for quality. Reading a loss waterfall tells you more than a single OEE for a line.
Enter your own shift figures into the OEE calculator to see the breakdown above in your browser; to rank stop causes there is the unplanned downtime Pareto analysis, and for the money side the unplanned downtime cost tool. To set up OEE measurement on your line, get in touch.
Let's discuss this for your plant
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