Introduction to OEE

Overall Equipment Effectiveness is a calculated KPI that provides valuable insight into

how effectively a manufacturing process is running. Having an OEE of 100% means that only good parts
are being manufactured, as fast as possible, with no stop time. However, this is not possible because the
line needs to be stopped to perform critical functions such as preventative maintenance, sanitation,
product changeovers, etc., so an OEE of 85% is considered world class.

OEE = Availability x Performance x Quality

Availability is the ratio of the time that the line ran to the time that it could have run

𝑅𝑢𝑛 𝑇𝑖𝑚𝑒 𝑅𝑢𝑛 𝑇𝑖𝑚𝑒

= =
Availability 𝐴𝑣𝑎𝑖𝑙𝑎𝑏𝑙𝑒 𝑅𝑢𝑛 𝑇𝑖𝑚𝑒 𝑅𝑢𝑛+𝐷𝑜𝑤𝑛+𝑆𝑒𝑡𝑢𝑝 𝑇𝑖𝑚𝑒

Performance is the ratio of the actual cycle time to the ideal cycle time where Ideal Cycle
Time is the fastest cycle time that the process can achieve

𝐴𝑐𝑡𝑢𝑎𝑙 𝐶𝑦𝑐𝑙𝑒 𝑇𝑖𝑚𝑒 𝑇𝑜𝑡𝑎𝑙 𝐶𝑜𝑢𝑛𝑡

Performance = 𝐴𝑐𝑡𝑢𝑎𝑙 𝐶𝑦𝑐𝑙𝑒 𝑇𝑖𝑚𝑒 =
𝐼𝑑𝑒𝑎𝑙 𝐶𝑦𝑐𝑙𝑒 𝑇𝑖𝑚𝑒 𝑅𝑢𝑛 𝑇𝑖𝑚𝑒

Quality is the ratio of good units produced to the total number of units produced

𝐺𝑜𝑜𝑑 𝐶𝑜𝑢𝑛𝑡
=
𝑇𝑜𝑡𝑎𝑙 𝐶𝑜𝑢𝑛𝑡
Quality

It is important when looking at OEE to also evaluate the individual components. They can be used to
provide insights into the underlying causes of lost productivity. The single OEE value will tell how well the
line is doing, and the three numbers capture the fundamental nature of the losses (Availability,
Performance, and Quality).