What is OEE ?

O = Overall

E = Equipment

E = Effectiveness
Overall Equipment Effectiveness is
a total measure of how
effective installations are working
 SETUP & ADJUSTMENT

MACHINE BREAK- IDLING & MINOR

DOWN STOPPAGE

MAJOR LOSSES

QUALITY DEFECTS REDUCED SPEED STARTUP YIELD

& REWORK
 Availability Rate * Performance Rate * Quality Rate = OEE

Small stops Production

Breakdown
& Idling Rejects
General Breakdown Cleaning In Process Damage
Checking Reworks
Support Equipment Failure
Component Jams
Improved
Operator shortages OEE
Reworks
Waiting for Maintenance Under Designed Capacity

Material Shortage Interruptions in Cycle Time Rejections

Setup & Reduced Startup

adjustment Speed Time
Reasons for Availability Losses:

1. Mechanical Breakdown 12. Breakdown in subsequent machine

13. Power shortage

2. Power Failure
14. Labour shortage
3. Electrical Breakdown
15. PPC did not assign any work
4. Changeover of product
16. Worker negligence
5. Changeover of shift
17. Temperature high
6. Loading time / feeding time
18. Pollution in the air, forcing stoppage
7. Unloading time
19. Dirty floor / unsafe condition, /insufficient
8. Planned downtime (to be included
light / fan not working
depending on definition of OEE)
20 Compressed air not available
9. Raw material not available
21. Cooling water insufficient
10. No orders
22. Machine hit
11. Breakdown of previous machine
Reasons for Performance Losses:
1. Old machine

2. Material hard

3. Machine vibrating

4. Voltage down

5. Product outside permitted range

6. Motor trips due to overload

7. Product quality falls

Reasons for Quality Losses:
1. Rejected for surface defects

2. Rejected for shape

3. Failed on density test

4. Rejected due to impurity high

5. Chemical property out of limit

6. Rejected by lab for weight

7. Failed when tested by third party

8. Failed on clients machine

9. Failed after three operations later

 OEE & Six Big Losses

Theoretical production time

Planning
factor (Pf)
Planned
Planned production time down
time
1 Equipment failure /
Breakdowns Availability
Factor (A)
Unplanned 2 Set up / adjustment
Gross operating time down time
losses
3 Idling / minor
Net operating stoppages Performance
Speed
time S Factor (P)
losses 4 Reduced Speed
Valuable
operating Quality Defects in process
5
losses and rework
time Quality
6 Start up losses factor (Q)

Six major losses

 Theoretical Production Time

The total theoretical production time available is

30 X 24 = 720 Hrs
 Planned Production Time

PPT = Theoretical Production Time – Planned Down Time

Planned Downtime = 64 Hrs.

PPT = 720 – 64 = 656 Hrs

Factors considered under Planned Downtime:

 Planned Preventive Maintenance

 Annual Shut Down
 Holidays
 Planned Breaks (Tea & Lunch Breaks)
 Excess Capacity
 Gross Operating Time

GOT = Planned Production Time – Unplanned Down Time

Unplanned Down Time = 175 Hrs
GOT = 656 – 175 = 481 Hrs

Factors considered under Unplanned Downtime:

 Equipment failure / Breakdown
 Set-up Time
 Net Operating Time

NOT = Gross Operating Time - Speed Losses

Speed Loss = 55 Hrs
GOT = 481 Hrs
NOT = 481 – 55 = 426 Hrs

Factors considered under Speed Losses

 Idling / minor stoppages
 Reduced Speed
 Valuable Operating Time

VOT = Net Operating Time - Quality Losses

Quality Loss = 14 Hrs
VOT = 426 – 14 = 412 Hrs

Factors considered under Quality Losses

 Defects / Rework / Rejections
 Start up losses
 Availability
• Availability factor is a measure of downtime
losses

Gross operating time (GOT)

Availability (A) =
Planned production time

= 481 / 656 = 0.73

Decrease in unplanned down time would increase GOT –
which in turn would increase A factor
 Performance
• Performance factor is a measure of speed
losses
Net operating time (NOT)
Performance (P) =
Gross operating time

= 426 / 481 = 0.88

Decrease in speed loss would result in increase of NOT – which
in turn would increase P factor
 Quality

Quality factor is a measure of quality losses

Quality (Q) = Valuable operating time (VOT)

Net operating time

= 412 / 426 = 0.96

Decrease in quality loss would increase VOT – which in turn
would increase Q factor
OEE = Availability * Performance Rate * Quality Rate

OEE = 0.73 * 0.88 * 0.96

OEE = 0.61
 Six Big Losses Target

Breakdown Zero

Availability
Setup & Minimize
Adjustment

Reduced Zero
Overall Speed
Equipment Performance
rate Idling &
Effectiveness
Minor Zero
Stoppages

Defects & Minimize

Quality Rework
Rate
Startup Zero
 STAGES OF SMED

120 MINS

STAGE I

80 MINS
TOTAL SET UP TIME

INTERNAL SET UP TIME STAGE II

Segregate
40 MINS
Internal
External Convert some
Elements Internal STAGE III
Elements or
parts of those
to External Reduce times of 7 MINS
Elements residual Internal
Elements
 Benefits From OEE
• Integrated platform and simultaneously focusing on three
factors namely Availability, Performance & Quality

• Comprehensive tool for shop floor management &

applicable uniformly across shops

• OEE measurement can be carried out anytime

• Facilitate moving from reactive repair and maintenance

mode to a more proactive approach
 Way Forward
Savings
Sustaining
EXPECTED GAINS
Restructuring
Product Mix Alternatives
Contribution Enhancement
Daily Work Management
Productive Maintenance
Training for Operations Excellence
5 S – Improved Workplace
Action Plan for OEE improvement
Waste identification and reduction
Finalization of Improvement Areas
Data Compilation & OEE Calculation
Selection of Critical Equipment
OEE Concept Training
Data Capturing Template
 Core & Critical Equipment

Core equipment :
Generates final output for the shop & shortfall
may affect the subsequent operation/shop
Capital cost is considerably high and adding
additional capacity is not feasible
Critical equipment
Directly affecting performance of the core
equipment
 Total Planned Down Time (PDT)
(Annual)
Planned Production
Planned Time (PPT)
Planned
Annual Shut Breaks (24*365 - Total Planned
Preventive Holidays Total Planned
down (Tea & Lunch Down Time)
Maintt. (Hours / Down Time
(Hours / Breaks)
(Hours / Annum) (Hrs / Annum)
Annum) (Hours /
Annum)
Annum)
a b c d e = ( a+b+c+d) f = ( 24*365 - e )
 Core and Critical Equipment Selection for OEE

Name of the Number of Stand By or

S. No. Core & Critical Equipments
Equipment equipments not

Capacity of the Equipment =

(Higher of the two) Is equipment a
Criticality of the bottleneck for next
Approx. Capital
equipment from or subsequent
Cost of
Customer's point equipment and
Equipment
Present of View can affect the
Supplier / Rated (Rs. Crores)
running (yes / no) shop throughput
Capacity
capacity (yes / no)
Unplanned Down Time
Current Equipment
(UDT) Gross
Availability in %
Operating
Time (GOT) =
(PPT - UDT)
Breakdown Set up
Variation
(Hours / (Hours / (Hours / Average
(Range)
Annum) Annum) Annum)

g h I = f - (g+h) j k
 Speed Losses (SL)
Net Operating
Time (NOT) =
Idling / (GOT - SL)
Reduced
minor
Speed
stoppages (Hours / Annum)
(Hours /
(Hours /
Annum)
Annum)
m n L = I - (m+n)
 Current Quality Rating
Quality Losses (QL)
in %
Valuable Operating
Time (VOT) = (NOT
Defects / - QL)
Start up
Rework /
losses Variation
Rejections (Hours / Annum) Average
(Hours / (Range)
(Hours /
Annum)
Annum)
o p q = L - (o+p) r s
 Assumptions

Basis for arriving Planned Production Time

• Budgeted PM time is considered as planned down time,

however time exceeding budgeted PM is treated as
unplanned down time

• During lunch breaks if production takes place then no

time is deducted
 Assumptions

• Basis for Unplanned Down Time

• Actual down time + excess of budgeted PM time is

considered

• One time assignable cause is treated as a down time

since it has resulted into production loss

• Effective downtime is treated as unplanned downtime,

however actual downtime is much higher for the
equipment hence in our studies actual time will be
considered for finding root cause
 Assumptions

Basis for Unplanned Down Time

• Setup time & changeover time is considered as

unplanned down time in order to give focus on
reducing the time by methods improvement & SMED

• Budgeted setup & changeover time is taken as it is in

the cases where it is lower than budgeted since the
reference data is of last six months, true picture would
emerge only after one year
 Assumptions

Performance
• In some shops budgeted rate is considered as reference,
however potential to produce at higher rate is possible
– it is to be ascertained

Capacity
• Present capacity of the equipment is considered as
reference, however it further requires need for
revisiting to establish scope for revision