1. Introduction to OEE (Overall Equipment Effectiveness)

2. Table of Contents What is Overall Equipment Effectiveness (OEE)
How to calculate OEE
Why is important to monitor it
Six big losses
Exercises

3. What is Overall Equipment Effectiveness (OEE)
Overall Equipment Effectiveness (OEE) is a core metric used to determine equipment availability, equipment performance and process quality.
OEE u
Gives operators a
focus on losses
Teaches operators
how and where their
machines cause
losses
Team Activities
Give a bottom - up
structure for
continuous
improvement
Activate shop
floor
knowledge
Using team activities to improve OEE =
continuously improving equipment effectiveness!
It provides to Managers with meaningful data to make rational
investment decisions
It provides managers with meaningful data to make rational

4. Training and Education
TPM
Safety Health and Environmental
Early Equipment
Design and
Start up
Management
Attack Six
Big Losses
Quality Maintenance
Each element of the Total Productive Maintenance (TPM) house is essential to supporting the Lean House.
Training and Education
The foundation for the other elements. Operators, maintenance staff and stakeholders receive the correct training for improving operator and maintenance skill levels. Also making material available for self-development fosters equipment-competent employees through TPM.
Autonomous Maintenance
Operators assume ownership for the efficiency of their equipment by personal involvement in early problem detection, routine cleaning, lubrication and equipment inspection. This also includes being a member of a Small Group Activity improvement team formed after completion of a workshop.
Planned Maintenance
Moving from reactive to proactive maintenance using planned and Condition Based Maintenance (CBM) technology with an emphasis on reliability of our assets.
Attack Six Big Losses
Equipment Failure
Setup and Adjustment
Idling and Minor Stoppages
Reduced Speed
5. Quality Defects Rework
Start up Losses
Quality Maintenance
Achieving and sustaining quality by proactively maintaining equipment and processes.
Equipment Design and Startup Management
New assets meet production needs and minimize Life Cycle Costs (LCC). Design right, buy right, build right.
Safety and Environment
Is the roof on the TPM house and paramount in all we do. This coupled with a clean and healthful workplace promotes excellent working and living conditions in our community.
Autonomous
Maintenance
Planned
Maintenance
SGA Team focuses on continuous reduction of production losses based on facts & data
Supported by:
AIW’s
Kaizen
OEE
Achieving and sustaining quality by maintaining equipment and processes
Asset focused
‘Small group activities’ assumes ownership for the efficiency of their asset(s)
Moving from reactive to proactive maintenance
New assets meet production needs and minimize Life Cycle Costs (LCC)
Training and Education
One Plan
One Team

5. Why Measure? Identify losses on a specific asset.
Provide feedback to stakeholders involved in improvement activities, and accurately reflect the results of the improvement effort.
Track facts & data to ensure root cause solutions to problems.
Demonstrate improvement visually.
Optimize productive capacity based upon facts & data.
Use improvement resources to maximize the benefit to production capacity.
Enhance ability to convincingly translate improvements into the language of management ($).
One of the first questions that needs to be asked of any given measurement system is “Why measure?” Just because you can get certain data easily, or just because somebody else measures something, it doesn’t necessarily mean that is the correct or best measure for your process.
A meaningful measure can:
·        Aid discovery of problems that might need attention in your process.
·        Aid prioritizing activities for the biggest payback.
·        Demonstrate the ‘improvement” has improved the process.
·        Help you communicate with management about your problems.
Can be converted into different units (time to $) that are more applicable to a persuasive discussion with management.

6. You can’t fix them * What gets measured gets fixed.
Why Measure?
* What gets measured gets fixed.
* If you don’t know what your losses are,
You can’t fix them

7. OEE
6 Big Losses

8. High impact on profits Equipment Production Losses (Six Big Losses)
Easy to measure
Labor
Materials/spares
Outside services
Maintenance overhead
Low impact on profit
Reduced Yield
Equipment
Failures
High
impact
on profits
Idling and
Minor Stoppage
Reduced Speed
Ask for examples of each of these losses.
Which loss is usually the biggest?
(Setup is typically the biggest loss.)
Many AIW activities are strictly focused on setup reduction with the goal being less than 10 minutes (SMED = Single Minute Exchange of Dies) .
Example: a machine setup improvement within Boeing where the setup was reduced from over 4 hours to 3 seconds.
Key Points:
·        What gets measured gets fixed.
Let’s make what’s important more measurable, instead of what’s measurable more important!!!
Set-Up and Adjustment
Quality: Defects in Process & Rework

9. The Six Big Losses Ask for examples of each of these losses.
Which loss is usually the biggest?
(Setup is typically the biggest loss.)
Many AIW activities are strictly focused on setup reduction with the goal being less than 10 minutes (SMED = Single Minute Exchange of Dies) .
Example: a machine setup improvement within Boeing where the setup was reduced from over 4 hours to 3 seconds.
Key Points:
·        What gets measured gets fixed.
Let’s make what’s important more measurable, instead of what’s measurable more important!!!

10. OEE Factors Ask for examples of each of these losses.
Which loss is usually the biggest?
(Setup is typically the biggest loss.)
Many AIW activities are strictly focused on setup reduction with the goal being less than 10 minutes (SMED = Single Minute Exchange of Dies) .
Example: a machine setup improvement within Boeing where the setup was reduced from over 4 hours to 3 seconds.
Key Points:
·        What gets measured gets fixed.
Let’s make what’s important more measurable, instead of what’s measurable more important!!!

11. The Six Big Losses Ask for examples of each of these losses.
Which loss is usually the biggest?
(Setup is typically the biggest loss.)
Many AIW activities are strictly focused on setup reduction with the goal being less than 10 minutes (SMED = Single Minute Exchange of Dies) .
Example: a machine setup improvement within Boeing where the setup was reduced from over 4 hours to 3 seconds.
Key Points:
·        What gets measured gets fixed.
Let’s make what’s important more measurable, instead of what’s measurable more important!!!

12. How to calculate OEE (in a nutshell)
Total Scheduled Hours A
Planned Production time
Scheduled
Downtime B
Operating time
Downtime
losses C
Theoretical output D
Actual output
Speed Loss
Minor Stops
OEE = E
Actual output
B/A x D/C x F/E
Availability Rate
Performance Rate
Quality Rate F
Good output
Scrap
Rework

13. Overall Equipment Effectiveness
This is the OEE equation.
World Class companies consistently maintain about 85% equipment effectiveness. However most companies do not know their potential for efficient use of their equipment and are probably running at less than 50%.
Let’s study the OEE equation to learn what it is and what it can do for your shop.

14. World Class OEE
OEE is essentially the ratio of Fully Productive Time to Planned Production Time. In practice, OEE is calculated as the product of its 3 contributing factors
OEE = Availability x Performance x Quality
This type of calculation makes OEE a severe test. For example, when all 3 factors are at 90%, OEE would be 72.9%. The following table shows generally accepted World Class goals for each factor
This is the OEE equation.
World Class companies consistently maintain about 85% equipment effectiveness. However most companies do not know their potential for efficient use of their equipment and are probably running at less than 50%.
Let’s study the OEE equation to learn what it is and what it can do for your shop.
Worldwide studies show that the average OEE rate in manufacturing plants is 60%

15. Example OEE Calculation
Data: Notice that all data are in the same units
Review:
Available Time: 1day = 1440 minutes
Planned Production: 760 minutes
Actual Production Time: 600 minutes
Produce Time (Ideal): 400 minutes
Value Added Time: 380 minutes
So if everything were ideal we could have done the same amount of work in 380 minutes that took us 760 minutes to do.
So if we could eliminate all these losses and produce at 100% OEE we could have made 190 parts today. Since 100% OEE is unheard of lets say that we are producing at the level of a world-class company which is 85% OEE, we then could have made 161 parts today instead of 95.
Example: 100% OEE: (760 minutes / 4 minutes per part = 190 parts)
Example: 85% OEE: (760 minutes x .85 = 646minutes) (646minutes / 4 minutes per part = parts)
parts)
Planned Production Time = (Shift Length – Breaks) = (480 – 60) = 420 min
Operating Time = (Planned Production Time – Down Time) = (420 – 47) = 373 min
Good Pieces = (Total Pieces – Reject Pieces) = (19,271 – 423) = 18,848 pieces

16. Example OEE Calculation
Review:
Available Time: 1day = 1440 minutes
Planned Production: 760 minutes
Actual Production Time: 600 minutes
Produce Time (Ideal): 400 minutes
Value Added Time: 380 minutes
So if everything were ideal we could have done the same amount of work in 380 minutes that took us 760 minutes to do.
So if we could eliminate all these losses and produce at 100% OEE we could have made 190 parts today. Since 100% OEE is unheard of lets say that we are producing at the level of a world-class company which is 85% OEE, we then could have made 161 parts today instead of 95.
Example: 100% OEE: (760 minutes / 4 minutes per part = 190 parts)
Example: 85% OEE: (760 minutes x .85 = 646minutes) (646minutes / 4 minutes per part = parts)
parts)

17. Your Turn
Exercise –
OEE Calculation

18. Practice Exercise
During an eight hour shift a canning machine is scheduled to run continuously. It should produce 60 cans per minute, but the machine ran poorly during the shift. Several jams were encountered and a breakdown finally resulted. The equipment was down the last two hours of the shift. A total of 1600 cases (12 cans per case) were produced, in addition to 125 damaged cans.
Calculate OEE for this equipment.
Actual Operating Time
Planned Production Time
Availability =
Performance =
Quality =
OEE = _____Availability x______Performance x_____Quality = _____
Amount Loaded x Ideal Cycle Time
Actual Operating Time
Review the practice exercise with the class. Have them attempt the computation before showing the answer.
(Amount Loaded - Number of Defects)
Amount Loaded

19. OEE = _____(Availability) x______(Performance) x_____(Quality) = _____
Practice Exercise
During an eight hour shift a canning machine is scheduled to run continuously. It should produce 60 cans per minute, but the machine ran poorly during the shift. Several jams were encountered and a breakdown finally resulted. The equipment was down the last two hours of the shift. A total of 1600 cases (12 cans per case) were produced, in addition to 125 damaged cans.
Calculate OEE for this equipment.
Availability =
Performance =
Quality =
OEE = _____(Availability) x______(Performance) x_____(Quality) = _____
480 min min.
480 min.
19325 cans x 1/60 min.
360 min.
(19325 cans cans)
19325 cans
= .75 = 75%
= .894 = 89%
= .993 = 99%
99%
89%
75%
67%