OEE Presentation - System A Tics

OVERALL EQUIPMENT
EFFECTIVENESS - OEE
A Tool to Drive
Manufacturing Competitiveness
OEE - A Tool to Drive Manufacturing Competitiveness
Meet Jim . . .
Jim is Operations Director for a fictitious,
soft drinks bottling plant.
Jim From two bottling lines,
the
plant ships
over 3M
Jim’s challenge (opportunity ?) :
units per annum.
Sales are up, margins are tight, and the capital budget is very limited !
To propose a production solution to meet a demand

of an additional 750,000 units per annum.
(an output increase of approx 25%).
2
of
2
0
‫شرکت خدمات مهندسی ره آوردگستره شرق‬
Jim has just come out of a somewhat unproductive

meeting with his management team :
Planning - “Batch sizes continue to decrease

as customers accept less inventory”
Jim
Engineering - “Changeover times are being

maintained with an extra Fitter
on each of the lines”
Operations - “Lines are running flat out - we

need more capital equipment and
we need to order it soon !”
3
of
2
0
After a restless night’s sleep, Jim comes in to work

with the problem of the extra 750,000 units still on
his mind.
Jim As he crosses the Production floor he again notices

something he has seen on a number of other
occasions.
This morning he decides to get to the bottom of it !
Why does one of the lines run slower than the other ?
4
of
2
0
Why does one of the lines run slower than the other ?
While the Production Manager isn’t sure why the

line-speeds are different, eventually Engineering
Jim
explain :
“Line Two produced too many rejects at full speed so

we turned the speed down by about 10% to improve
the quality.”
“It seems to have done the trick - reject levels are
much lower on Line Two now !”
5
of
2
0
And talking of rejects . . . .

Our quality performance is very good - better than
98% at the end of the line !
Jim How come these ‘Line Two rejects’ don’t show up ?
“Well they’re not really ‘rejects’ - they fall off the

filling line for various quality problems, but can be put
back on the line and re-run successfully.”
“Makes more sense than scrapping them !”
But this means that it takes two operating cycles to
produce each ‘reject’, with a consequent capacity loss
each time !
6
of
2
0
Thinking about the original business justification

for the lines, Jim remembers that the speed quoted
by the equipment supplier was significantly higher
than the speed they are running at now ?
Jim
The original design specification showed both lines
capable of running more than 10% faster than
Line One runs currently !
Why are these lines not running at the design speed ?
It’s soon clarified for Jim :
“That speed was an estimate for the financial
justification - we never really expected to be able to
run the lines at that speed for any sustained period.” 7
of
2
0
Jim wondered about what other losses were

occurring on the lines.
Breakdowns and changeovers also caused the lines

Jim to loose output.
Records for the past three months show that

breakdowns account for a 30% loss, while breaks,
shift-handovers, product change-over, cleaning,
quality checks, material run outs and meetings
mean that the lines are only running for 50% of
the total time that they are available to run !
8
of
2
0
Jim doesn’t know it, but he is learning the hard way

about OEE - Overall Equipment Effectiveness.
OEE is used by many of the world’s best companies

Jim to assess equipment performance and to drive
operational performance improvements.
OEE is the crucial link between the financial and

operational performance of production assets.
Jim is beginning to understand that his bottling lines
are running at less than 40% OEE !
Perhaps investing in a new line is not the only option !

9
of
2
0
What is OEE and why is it used ?

The overall performance of a single piece of equipment, or even
an entire factory is governed by the cumulative impact of three
factors :
Availability
Performance Rate
Quality Rate
OEE is a very simple, but profoundly important, performance

measure that makes this information visible and combines these
three key parameters into a single measure of performance.
10
of
2
0
OEE can be defined as :

The quantity of good product produced
as a percentage of
what would have been produced in the time the
equipment was scheduled to run,
running at the machine design rate,
and without producing defects.
Good Units Completed

OEE =
Scheduled Time x Design Rate
11
of
2
0

Total Time
Unscheduled
Unscheduled
Scheduled
ScheduledTime
Time Time
Time
Planned
Planned Changeovers
Changeovers
Planned
PlannedProduction
ProductionTime
Time Downtime
Downtime PM’s
PM’s
Unplanned
Unplanned Breakdowns
Breakdowns Availability
Availability
Uptime
Uptime Downtime
Downtime Waiting
Waiting AA
Speed
Speed Reduced
ReducedSpeed
Speed Performance
Performance
Net
NetOperating
OperatingTime
Time Loss
Loss Idling
Idling PP
Equivalent
Equivalent Yield
Yield Defects
Defects Quality
Quality
Operating
Operating
Time
Loss
Loss Rework
Rework QQ
Time
12
of
2
0

 OEE focuses on Availability, Performance and Quality.
 It is an all-inclusive measurement of equipment productivity.
 It can help identify and quantify specific opportunities for
improvements in operational performance.
 It can be used to save companies from making inappropriate
purchases, and help them to focus on improving the performance
of machinery and plant they already own.
 And, when investment in a new machine is necessary, the OEE
measure can be used to make sure that the performance of the
equipment satisfies the original business case.
 In addition, it can also be used to ensure that equipment suppliers
deliver what they promised !
13
of
2
0
In OEE terms, Jim’s plant looks like this :
OEE = A * P * Q
Jim
Availability (A) = 50%
OEE
Performance (P) = 85% =
38.35%
Quality (Q) = 90%
14
of
2
0
Back to the real world . . .
Jim’s story is not untypical.

Decisions to purchase equipment, production lines
and whole factories are frequently made with lack
of meaningful performance information.
Some companies (like Jim’s) do not measure any
of the key parameters of machine or plant
performance . . .
. . . and of those that do, most fail to consider the

compound effect of speed, quality and availability.
15
of
2
0
Systematics have developed an application

PERFORM OEE
which reports OEE performance for production lines,
identifying and quantifying the root causes of OEE losses
MAIN PLANT
OEE ANALYSIS OEE ANALYSIS
MANUFACTURING OEE
FILLING Unaccounted
PACKAGING
Yield Loss
FILLING-1 Planned
PACKAGING – LINE 1 Downtime Unplanned
PACKAGING – LINE 2 Downtime Speed Loss
DOWNTIME ANALYSIS
48% 95% 93% 42%
16
of
2
0
Let’s get back to Jim . . .

- because this story has a happy ending . . .
Using OEE methodology, Jim has identified the

Jim major causes of lost capacity on the lines and has
initiated a capacity improvement program using
OEE to drive improvement actions.
Jim and his team have improved the plant OEE

performance from 38% to 50%.
(and have a plan to get to 55% within the next six months !)
17
of
2
0
Since learning about OEE, Jim has heard similar

success stories from other manufacturing operations :
A medium sized engineering company -
- avoided a €250,000 expenditure on a new cutting machine
by improving the performance of an existing one.
Jim
A pharmaceutical manufacturing company -
- improved the OEE of existing packaging lines from 30% to
50%, thereby avoiding the purchase of an additional line.
An automotive components supplier -
- improved the output from production cells to enable the
demand to be fulfilled over two shifts instead of three.
A frozen-foods producer -
- revitalised a flagging continuous program, by introducing the
OEE measure along with ‘operator-driven’ improvements on
the shopfloor. 18
of
2
0
OEE up from 38% to 50% ! - that’s an output

increase of over 1M units per annum . . .
No capital expenditure !
Jim No extra shifts or overtime !
No extra headcount !
Significantly reduced operating costs !
A much happier man than when we started the presentation !!
In fact, rumour has it that Jim is in line for the next VP job !
19
of
2
0
Thank You
20
of
2
0

OEE Presentation - System A Tics

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

OEE Presentation - System A Tics

Uploaded by

Copyright:

Available Formats

OVERALL EQUIPMENT

To propose a production solution to meet a demand

Jim has just come out of a somewhat unproductive

Planning - “Batch sizes continue to decrease

Engineering - “Changeover times are being

Operations - “Lines are running flat out - we

After a restless night’s sleep, Jim comes in to work

Jim As he crosses the Production floor he again notices

This morning he decides to get to the bottom of it !

While the Production Manager isn’t sure why the

“Line Two produced too many rejects at full speed so

And talking of rejects . . . .

“Well they’re not really ‘rejects’ - they fall off the

Thinking about the original business justification

Jim wondered about what other losses were

Breakdowns and changeovers also caused the lines

Records for the past three months show that

Jim doesn’t know it, but he is learning the hard way

OEE is used by many of the world’s best companies

OEE is the crucial link between the financial and

Perhaps investing in a new line is not the only option !

What is OEE and why is it used ?

OEE is a very simple, but profoundly important, performance

What is OEE and why is it used ?

OEE can be defined as :

Good Units Completed

What is OEE and why is it used ?

What is OEE and why is it used ?

In OEE terms, Jim’s plant looks like this :

Back to the real world . . .

Jim’s story is not untypical.

. . . and of those that do, most fail to consider the

Systematics have developed an application

Let’s get back to Jim . . .

Using OEE methodology, Jim has identified the

Jim and his team have improved the plant OEE

Since learning about OEE, Jim has heard similar

OEE up from 38% to 50% ! - that’s an output

A much happier man than when we started the presentation !!

You might also like