Lean tools to cut waste
How to calculate OEE

OEE is essentially the ratio of Fully Productive Time to Planned Production Time. In practice, however, OEE is calculated as the product of its three contributing factors:

Mr DMA Kulasooriya

OEE = Availability x Performance x Quality
This type of calculation makes OEE a severe test. For example, if all three contributing factors are 90.0%, the OEE would be 72.9%. In practice, the generally accepted World-Class goals for each factor are quite different from each other, as is shown in the table below
Of course, every manufacturing plant is different. For example, if your plant has an active Six Sigma quality programme, you may not be satisfied with a first-run quality rate of 99.9%.

Worldwide studies indicate that the average OEE rate in manufacturing plants is 60%.
As you can see from the above table, a World-Class OEE is considered to be 85% or better. Clearly, there is room for improvement in most manufacturing plants! How about yours?
Calculating OEE
As described in World-Class OEE, the OEE calculation is based on the three OEE Factors, Availability, Performance, and Quality.
Availability takes into account Down Time Loss, and is calculated as:

Availability = Operating Time / Planned Production Time
Performance takes into account Speed Loss, and is calculated as:

Performance = Ideal Cycle Time / (Operating Time / Total Pieces)
Quality takes into account Quality Loss, and is calculated as: Quality = Good Pieces / Total Pieces
Example OEE Calculation
The table below contains hypothetical shift data, to be used for a complete OEE calculation, starting with the calculation of the OEE Factors of Availability, Performance, and Quality. Note that the same units of measurement (in this case minutes and pieces) are consistently used throughout the calculations.
Planned Production Time = [Shift Length - Breaks] = [480 - 60]= 420 minutes
Operating Time = [Planned Production Time - Down Time] = [420 - 47] = 373 minutes
Good Pieces = [Total Pieces - Reject Pieces] = [19,271 - 423] = 18,848 pieces
Availability = Operating Time / Planned Production Time

  • 373 minutes / 420 minutes
  • 0.8881 (88.81%)

Performance = Ideal Cycle Time / (Operating Time / Total Pieces)

  • (19,271 pieces / 373 minutes) / 60 pieces per minute
  • 0.8611 (86.11%)

Quality = Good Pieces / Total Pieces

  • 18,848 / 19,271 pieces
  • 0.9780 (97.80%)

Calculating Plant OEE can be very useful for monitoring trends or as a rough gauge of where a given plant lies in the OEE benchmarking spectrum. However, one should be very cautious about using OEE to compare different plants, or even to compare different production assets. Unless production assets are running identical products on identical equipment under identical conditions, comparing their OEE metrics is somewhat akin to comparing apples to oranges.

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