How to Calculate Oee

Overall Equipment Effectiveness, or OEE, is a modern way to assess production. This measurement can be used for a variety of systems, from a single workstation to a large industrial plant or facility. OEE is a set of metrics that shows business leaders how much they are getting out of their production systems. If you need to calculate OEE for a company or business, or a single department or location, here are the common steps involved in figuring up this benchmark.


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    Know the 3 major elements of OEE. Operations pros identify the core factors of the OEE measurement as Availability, Performance and Quality.
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    Figure out the Availability component of OEE. Divide the actual production time by the total planned production time.
    • For example, if the equipment is planned to run 24/7, but averages a total of 12 hours of down time each day, the Availability result would be 50 percent.
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    Assess the Performance component. In general, the Performance component of OEE assesses how equipment is used during its actual running time. To get the Performance number, divide the actual number of pieces produced by the planned capacity of production for the same time frame, according to engineering specs.
    • For example, if your equipment produces 85 pieces in an hour but the specification says it should produce 100, your result is .85. If another shift runs the equipment and produces 105 pieces, the result increases to 1.05.
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    Calculate the Quality component. This involves determining the proportion of pieces, out of all manufactured pieces, that are good enough to meet your company's standard of utility. You'll need to know your own company standard for utility. It usually relates to whether or bot pieces are good enough to be sold. Using that standard, divide the number of usable pieces by the total number of pieces made.
    • For example, for 92 saleable pieces from 100 pieces made, the Quality result is 0.92.
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    Take into account the "people factor" in OEE results. When you have your total figures in hand, try to identify the reasons for any low percentages. One possible explanation, particularly in the Availability component, relates to the human use of machinery. Most factory machinery is controlled by humans and down time may indicate training or safety problems, so include these items as part of your overall assessment.
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    Investigate other reasons for "efficiency gaps." Maintenance, job setup, electrical and fuel sources, along with other issues may all affect your OEE numbers.
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    Contrast the existing production to planned capacity. Your OEE numbers will help you to learn more about specific opportunities for better work space setups and better production with the same amount of resources.


  • Find tools for measuring OEE. Some software programs for sale to businesses help human decision makers collect the raw data used for OEE and put it into visual, easy-to-understand forms in order to help with both assessment and implementation.
  • Use OEE to boost output without investing in more assets. Some professionals who consult on OEE point out to business clients that one of the chief benefits of this assessment is to help utilize what a business has, rather than having to acquire more in order to make more. In terms of "internal expansion" that is cheaper, OEE is a major resource.

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Categories: Accounting and Regulations