The Complete Guide to Simple OEE
Page 11
A Real Example of Calculating Simple OEE:
Below in Table 3 is an example of real machine prod
uction data to help you understand
the concept of OEE and the calculation of this data
. This example will show the
calculation of Simple OEE and the Simple OEE Metric
s of Availability, Performance,
and Quality.
Machine Data
Values
Shift Length (8 hours)
480 minutes
Run Time
375 minutes
Breaks
60 minutes
Setup Time
15 minutes
Down Time
30 minutes
Total Time
420 minutes
Ideal Cycle Time
1 part every 63 secs
Total Count
360
Good Count
355
Target Counter
400
Table 3 (Machine Production Data)
Production Data (Calculated Values from Production
Marquee)
Data Source
Run Time
375
Total Production Minutes per Shift
Run Time
Break Times
60
Total Break Minutes per Shift
Run Time
Down Time
30
Total Downtime Minutes per Shift
Down Time
Setup Time
15
Total Setup Minutes per Shift
Setup Time
Total Count
360
Total Parts Produced per Shift
Total Count
Good Count
355
Good Parts Produced per Shift
Bad Count
Target Counter
400
Expected Parts per Shift
Target Counter
Process Data
Formula
Result
Run Time
Total Production Time of the Machine
375
Total Time
Down Time + Run Time + Setup Time
420
Good Count
Total Good Parts Produced on the Machine
355
OEE Variables
Formula
Result
Availability
Run Time / Total Time (375 / 420)
89.29%
Performance
Total Count / Target Counter (360 / 400)
90.00%
Quality
Good Count / Total Count (355 / 360)
98.61%
Simple OEE
Availability x Performance x Quality
79.24%
The Complete Guide to Simple OEE
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The
Target Counter
interval period or Ideal Cycle Time = 1 part every
63 seconds
(400 parts should be produced in 420 total minute
s of the machine)
If downtime is reduced by 15 minutes (900 seconds),
the machine could
produce 14 more parts. (900 seconds x 1 part / 6
3 seconds = 14 parts)
Availability
improves to (389/420) = 92.62%
Performance
improves to (374/400) = 93.50%
Quality
improves to (369/374) = 98.66%
Simple OEE
improves to (.9262 x .9350 x .9866) =
85.44%
Reducing your downtime by 15 minutes in this exampl
e produced a
6%
increase in
Simple OEE. Downtime is the most critical factor t
o improving Simple OEE because
when the process is not running you cannot address
other metrics.
Many manufacturing companies have capacity constrai
nts and consider adding overtime,
hiring new workers, or buying new equipment. The b
ottom line is a modest investment
to optimize the performance of their existing machi
nes may outweigh the major
investment to purchase new equipment. By reducing
down time, minimizing setup time,
and improving operator performance, a manufacturing
company can unleash hidden
capacity and benefit from monitoring Simple OEE dat
a.
Below in Table 4 lists the World Class Goals for ea
ch metric you are trying to measure.
The average OEE value in manufacturing plants is 60
%. World Class standards for OEE
metrics are Availability 90%, Performance 95%, Qual
ity 99.9%, and OEE 85%. Measure
the OEE data from your machine and see how you comp
ete with the “World Class”.
OEE Metric
World Class Value
AVAILABILITY
90.00%
PERFORMANCE
95.00%
QUALITY
99.90%
OEE
85.00%
Table 4 (World Class Goals)
The Complete Guide to Simple OEE
Page 13
Frequently Asked Questions about Simple OEE:
1)
Are Simple OEE metric values subject to misinterpre
tation?
Yes. You should look for these Simple OEE metrics t
o help you monitor the
machine to minimize losses and eliminate bottleneck
s in your process. Simple
OEE data does not supply you with the best decision
to make an improvement or
how much it will cost to make these changes. But, S
imple OEE data is very useful
in your efforts to improve the process of your mach
ine by separating data into the
three metrics of Availability, Performance, and Qua
lity.
2)
Can Simple OEE create political differences at the
management level?
Yes. Sometimes this misinterpreted data can be use
d for political purposes rather
than working to improve the overall productivity of
the machine. The important
concept to keep in mind is to produce more quality
parts with reduced downtime
and less waste. As with the measurement of any num
ber, make sure you have a
clear plan that will deliver a result. This will h
elp you create a plan to incentivize
your machine operators to maximize the productivity
of the equipment.
3)
Can Simple OEE help management enable machine opera
tors?
Yes. The real value of Simple OEE is providing man
agement and machine
operators the ability to make systematic improvemen
ts to the process of the
machine. The concept of Simple OEE is to put this
information in terms that are
easily understood and keep the machine operator inf
ormed with visual data on the
manufacturing plant floor.
4)
Are Simple OEE metric values defined in numbers of
parts or units or time?
The answer is to use the unit of measure that you b
est understand. Availability is
usually described in hours and minutes, Performance
in parts per minute or hour,
and quality as the ratio of good product to total p
roduction. All of these metrics
are converted to the percentage (%) of the actual v
ersus potential in the Simple
OEE calculations.
5)
What sample time period should I use for my Simple
OEE test?
The Simple OEE sample time period can be any period
of time. Usually, it is set
on the working cycle of the machine. One shift equ
als 8 hours or 480 minutes.
Some other sample periods could include 10 hours, 1
2 hours, 1 day, the job or
part number, or continual monitoring.
The Complete Guide to Simple OEE
Page 14
6)
Do the Simple OEE metric calculations of a machine
represent a magical
number?
No. The strength of Simple OEE is that it gives yo
u four metric numbers. These
numbers can be used individually to make decisions
as your machine process
changes from day to day. The Simple OEE metrics he
lp you visualize the total
resources of your manufacturing process as it relat
es to what the machine actually
produced. If your machine produces these Simple OEE
metric numbers:
Availability 90%, Performance 85%, Quality 99%, Sim
ple OEE = 76% only you
can decide if these numbers are good or bad. Howev
er, if your machine produced
these Simple OEE metric numbers: Availability 98%,
Performance 85%, Quality
91%, Simple OEE = 76% are these numbers any better.
The Simple OEE metric
stayed the same but is the drop in quality worth th
e improvement in availability.
Most manufacturers always try to improve quality so
they would consider this to
be an unacceptable tradeoff.
7)
Is it possible to have to have a Simple OEE metric
exceed 100%?
No. If your Simple OEE metrics (Availability, Perf
ormance, Quality, Simple
OEE) are greater than 100%, you are not defining so
mething in your process
correctly. You are probably underestimating the ca
pacity of a process when you
input your machine parameters. Most commonly, the
Performance metric has not
been correctly calculated when determining your Ide
al Cycle Time (Target
Counter Value) of your process.
8)
What defines if a machine is producing parts (runni
ng)?
For the purpose of measuring productivity, the Simp
le OEE metric needs to know
if the machine is producing product, even if this p
roduct is good or bad. If the
machine is scheduled for production (not in break o
r planned maintenance), the
production clock is running and the machine is cons
idered producing parts.
9)
How do you determine the Ideal Cycle Speed (Target
Counter Value) of your
machine?
If the “nameplate capacity” of the machine is avail
able from the equipment
manufacturer, this would give you the capacity data
for that particular machine.
If this data is unavailable, you should perform mac
hine calculations to measure
the cycle times and rates of the machine. These nu
mbers will give you a starting
point but may vary depending on machine age and ope
rator training. Take
measurements, experiment, and calculate your own Id
eal Cycle Speed (Target
Counter Value).
The Complete Guide to Simple OEE
Page 15
10)
Are reworked parts counted as good or bad parts in
the Simple OEE
calculation?
In the Simple OEE calculation, any part that comes
out of the machine not
manufactured to specifications the first time is co
nsidered a bad (reject) part. This
is a production problem that exists at the machine
and needs to be addressed by
management. You need to implement a production pra
ctice for improving
original part quality versus reworking bad parts.
11)
If I have multiple machines in a group cell, which
machine should you base
my Ideal Cycle Time (Target Counter Value) on?
Your Ideal Cycle Time (Target Counter Value) should
be based on the fastest
machine of the group cell. Typically, most machine
s in a group cell are designed
to produce product at the same rate. Using the fas
test stage as your target, forces
you to recognize the bottlenecks and work on improv
ing the process of product
flow in the machine.
12)
If my machine is running during a scheduled break,
is this break time
factored into machine availability?
If the machine is producing parts, then regardless
if that machine operator is or is
not on break Simple OEE considers this to be part o
f the machine runtime and is
factored into machine availability.
13)
Does preventive maintenance downtime penalize the S
imple OEE
performance calculation?
If the preventive maintenance occurs during actual
production time rather than
during planned shutdown, you are interfering with m
achine production and should
count this downtime in the Simple OEE Performance m
etric. Monitoring
downtime and supplying a reason code will help us m
onitor and measure if this
scheduled maintenance will result in less overall d
owntime due to fewer surprises
and more efficient machines than losing production
when maintenance is called to
the machine.
14)
How do I optimize my data collection to make OEE, s
imple OEE?
Automate your OEE data collection and collect your
plant information in real
time by installing Production Marquees. Production
data is not very useful if you
see it in a printout tomorrow in the production off
ice or don’t visualize it on the
plant floor. With this real time plant information
, management and machine
operators can react to the information and alarms d
isplayed on the plant floor and
monitor and collect the Simple OEE metrics anywhere
within your manufacturing
plant.
The Complete Guide to Simple OEE
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Simple OEE Glossary of Terms:
A
Availability
One of the three Simple OEE metrics. This is the p
ossible production time after all
downtime losses (machine breakdowns, machine adjust
ments/setup) are subtracted.
B
Bad Count
The input count for any part not produced to manufa
cturing specifications. (bad/reject)
Balanced Production
When a manufacturing process produces exactly what
the product demand is. Takt time
is the measurement used most often to determine if
a manufacturing process is balanced.
Benchmarking
A comparison tool used to determine the level of pr
oduct, process, growth, or other
successes your manufacturing plant is experiencing
when compared to similar companies
with similar processes and products. Used to ident
ify a company’s strengths and
weaknesses compared to their competitors and make n
ecessary adjustments.
Best Practices
Repeatable procedures that over time prove to be th
e most efficient and effective way of
accomplishing a task. Successful companies use to
develop a standard of measuring.
Bottleneck
The slowest operation or choke point in a manufactu
ring process or machine.
C
Capacity
The maximum amount a machine, system, or process ca
n produce.
The Complete Guide to Simple OEE
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Changeover Time
Time lost on a machine due to swapping out material
, tooling, connections, or equipment.
Changeovers
Switching from producing one product to a new produ
ct on a machine. This process may
involve replacing dies or removing unused materials
. In Lean Manufacturing terms
changeovers are accomplished through S.M.E.D. (Sing
le Minute Exchange of Die)
programs which strive to accomplish a complete chan
geover in under ten minutes.
Continuous Improvement
The ongoing process of trying to do things better,
faster, and less expensive.
Cycle Time
The time to produce one part or one repetition of a
particular task on a machine.
Cycle Time Analysis
Tool used to determine cycle times of a machine and
a way to understand the events that
affect the Performance metric of Simple OEE.
D
Down Time
The period of time the machine is not available for
production due to maintenance or
breakdown.
Down Time Loss
Any production time lost due to unplanned shutdowns
. One of the three Simple OEE
Loss Categories which reduces the Simple OEE metric
, Availability.
Down Time Reason Codes
Available codes to select that explain why a machin
e is down or not producing parts.
These codes help to attribute the specific source o
r reason to why the machine is down
and can be monitored and collected to analyze the p
roduction process. With down time
reason codes, Root Cause Analysis can be applied to
start determining Down Time
Losses.
The Complete Guide to Simple OEE
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E
Empowerment
Giving employees more authority, accountability, an
d responsibility to affect their work
place and improve their daily lifestyle. Many of t
he best manufacturing companies invest
in Simple OEE programs that empower an individual t
o be more productive.
External Setup
The steps and procedures you can perform while the
machine is still running that
facilitate the S.M.E.D. (Single Minute Exchange of
Die) process.
Event
In Simple OEE, an event is a production loss which
occurs on a machine that is
categorized.
F
Final Machine Run Time
The actual production time of the machine after sub
tracting all Losses (Downtime, Speed,
Quality). This is what Simple OEE measures – your
machine’s real efficiency.
G
Goal
A measurable objective a machine intends to achieve
within a specific period of time.
S.M.A.R.T. Goals are Specific, Measurable, Attainab
le, Relevant, and Timely.
Good Count
The input count for any part produced to manufactur
ing specifications. These parts meet
quality standards without any rework. Good count i
s used to calculate Simple OEE
Quality.
The Complete Guide to Simple OEE
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K
Kaizen
A Japanese term for “improvement”. A Japanese philo
sophy that implements the Lean
Manufacturing tools used to effect improvements in
the manufacturing process. This
approach is to motivate employees plant wide to bec
ome involved in the evolution and
improvement of all functions of the business by eli
minating waste.
Key Performance Indicators (KPI’s)
KPI’s refer to a list of measurable parameters that
will indicate how well a manufacturing
plant is doing at attaining goals. Availability, P
erformance, Quality, and Simple OEE are
all KPI’s that a manufacturing plant would like to
measure. The Production Marquee has
these plus 25 more KPI’s built into the product for
your easy implementation.
L
Lean Manufacturing
A manufacturing system that strives to relentlessly
eliminate waste from its operations.
Lean Manufacturing strives to produce products that
are on time and use as few resources
as possible. The Simple OEE metric is a key tool i
n Lean Manufacturing programs.
Lean Manufacturing includes many manufacturing impr
ovement tools such as S.M.E.D,
TPM, 5S, and Kanban. Lean Manufacturing empowers a
nd motivates employees to
engage in activities to better their respective com
panies.
M
Machine Adjustments/Setups
One of the Major Loss Events. Machine Adjustment/S
etups is the time lost on the
machine due to configuring equipment. Setup and ma
chine changeovers contribute to
Simple OEE Downtime Losses and reduce the Simple OE
E metric, Availability.
Tracking machine setup time is critical in reducing
this Downtime Loss.
Machine Breakdowns
One of the Major Loss Events. Machine Breakdowns i
s the time lost on a machine due to
equipment failure. Machine Breakdowns contribute t
o Simple OEE Downtime Losses
and reduce the Simple OEE metric, Availability.
The Complete Guide to Simple OEE
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Machine Production Bad Parts
One of the Major Loss Events. Manufactured parts w
hich did not meet quality
specifications. These bad parts or rejects were pr
oduced during the steady state
production of the machine. Machine Production Bad
Parts contribute to Quality Losses
and reduce the Simple OEE metric, Quality.
Machine Reduced Speeds
One of the Major Loss Events. Machine cycle where
the process is running but at a
slower than expected rate. Machine Reduced Speed
s contribute to Simple OEE Speed
Losses and reduce the Simple OEE metric, Performanc
e.
Machine Startup Bad Parts
One of the Major Loss Events. Bad parts produced w
hile the machine is adjusted for
production. Machine Start Up Bad Parts contribut
e to Speed Losses and reduce the
Simple OEE metric, Quality.
Machine Stops
One of the Major Loss Events. A Machine Stop is a
pause in production typically less
than five minutes. It is usually not long enough t
o be tracked as downtime. Machine
Stops contribute to Speed Losses and reduce the Sim
ple OEE metric, Performance.
Machine State
The active state of the machine. The machine state
can be run, jog, setup, or down.
Major Loss Events
The categories of production losses that are most p
revalent in the manufacturing process.
Machine Breakdowns, Machine Adjustments/Setups, Mac
hine Stops, Machine Reduced
Speeds, Machine Startup Bad Parts, and Machine Prod
uction Bad Parts make up the
Major Loss Events. The Simple OEE metrics help iso
late these six different Major Loss
Events to help you address them each individually a
nd improve your process.
Material Shortage
A condition causing a machine to be down from being
out of parts or the materials
needed to make that part. The machine cannot conti
nue to produce product until the
material flow has been corrected. A downtime reas
on code can be associated with this
condition and displayed on the Production Marquee f
or plant wide notification.