OEE (Overall Equipment Effectiveness) compares planned production output with actual results, expressing how effectively manufacturing potential is utilized as a percentage.
This metric is based on three key factors, whose combination indicates how efficiently an asset operates in the production process: availability, performance, and quality. Each factor provides different insights into asset performance:
- Availability – How often is the asset running when it is supposed to?
Availability accounts for Availability Loss, which includes all events that stop planned production for a significant period (typically several minutes or longer). Availability losses include unplanned stops (such as equipment failures or material shortages) and planned stops (such as changeovers).
- Performance – How much does the asset produce?
Performance accounts for Performance Loss, which includes all factors that cause the asset to operate below its maximum possible speed while running (including slow cycles and minor stops).
It is calculated as the ratio of net operating time to operating time:
Performance = (Ideal Cycle Time × Total Count) / Operating Time
Ideal Cycle Time represents the theoretical minimum time required to produce one unit. When multiplied by the total count, it yields net operating time—the fastest possible time to produce the total number of parts.
- Quality – How many high-quality products does the asset produce?
Quality accounts for Quality Loss, excluding produced parts that do not meet quality standards, including parts that require rework.
It is calculated as the ratio of fully productive time (producing only good parts at maximum speed with no downtime) to net operating time:
Quality = Good Count / Total Count
When an asset operates at 100% OEE, it means every produced item is defect-free (quality), produced as fast as possible (performance), and without unplanned downtime (availability).
To calculate OEE accurately, the following definitions must be clearly understood:
- Good Count: Defect-free produced parts.
- Ideal Cycle Time: The theoretically fastest time to produce one unit.
- Planned Production Time: The total time the asset is scheduled for production.
- Fully Productive Time: Producing only good parts as fast as possible without downtime.
Previously, a 100% OEE score was defined as perfect production: producing only good parts, as fast as possible, with no downtime. When this concept aligns with OEE:
- Producing only good parts corresponds to 100% Quality.
- Operating at maximum speed corresponds to 100% Performance.
- Operating without downtime corresponds to 100% Availability.