15.08.2019

# What is the OEE indicator?

**One of the most important key performance indicators is the OEE (Overall ****Equipment Effectiveness).** This marker defines the total equipment effectiveness and allows the maintenance service to estimate the effectiveness of the machine use at the manufacturing facility accurately. Find out what the OEE indicator is and how to calculate it.

### Availability

Availability is an indicator informing about the ratio of the time allocated to manufacturing and the factual time dedicated to the task.

Availability decreases with failure, machine upkeep and servicing, repair, as well as any other **maintenance activities**.

### Performance

Performance is defined by the ratio of the availability time of the machine (or a group of machines) to the factual usage time. Performance decreases when the speed of the operation conducted within the production processes is reduced.

Performance can also be defined by the loss of effectiveness: the ratio of the real production to the default one.

### Quality

Quality is an indicator defining the ratio of good quality products to the total of products manufactured. It can also be defined (though less frequently) just by the total number of products manufactured.

## How do you calculate the OEE indicator?

The OEE is calculated by multiplying availability, performance and quality. In order to specify this indicator correctly and efficiently, it is essential to carry out a multi- stage process as a series of five steps:

**Estimate the total production time.****Estimate the planned production time.****Conduct the performance loss analysis.****Define the indicators: availability, quality and performance.****Calculate the OEE indicator.**

### A sample calculation of the OEE indicator

In order to present the calculation methods for the key performance indicator: the OEE, we will use the example below.

Letʼs consider the test conducted during one shift which lasted 8 hours (480 min). The shift is the total production time. Letʼs just add the following data:

- waste: 500 pieces
- speed losses: 30 min
- nominal machine efficiency: 40 pieces/ minute
- total failure time: 35 min
- employee break: 35 min

First we estimate the **planned production time**– which in our case is the shift time minus scheduled interruptions: in this case the employee break.

So: 480- 35 and that gives us 445 minutes

Next, we estimate the** operating time** which is the planned production time minus the unscheduled interruptions (failures).

That brings us to the following: 445- 35= 410 minutes.

Next, we estimate **the availability indicator** which basically means multiplying the operating time and the planned availability.

In this case, the availability indicator looks like this: 410/445 min * 100% =

92%.

The next step is to estimate **the speed loss** by multiplying the work time and the lowest performance, That gives us: 30 min * 50% = 15 minut.

Effectiveness at 50% is an equivalent of working with the maximum effectiveness half of the time and handling outages the other half.

Further along, we estimate **the net operating time** which is the difference between the total operating time and the speed loss.

In our case that is: 410 – 15 = 395 minuts.

Next, we calculate **the performance indicator** by multiplying the net operating time and the total operating time: 395/410*100% = 96%.

Now we estimate **the quality losses**– that would be the ratio of the amount of faulty products to the quality losses: 500/40 = 12,5 min.

The next step is calculating **the effective production time**. That would be the difference between the net operating time and the quality losses: 395-12,5 =

382,5 min.

And we are almost there: calculating **the quality indicator**. Multiply the effective production time and the net operating time: 382,5/395 *100% = 97%.

Based upon the above, we now are able to calculate the **OEE indicator** which in our case brought us to the following: 92% * 96% * 97 % = 86%.