OEE Improvement Strategy
Your OEE optimization approach must include a method for measuring downtime, rejections, and cycle times 24/7. OEE, or Overall Equipment Effectiveness, is a fantastic idea that informs you how much waste is on your shop floor in a single number. It’s just the ratio of what you actually produced to what you could have produced — the actual output to theoretical maximum capacity. It’s a straightforward indicator of your profitability and return on investment. Increased OEE leads to increased profitability.
Availability: The percentage of planned running time available for production is known as availability. Unplanned and planned downtime fall under this type of losses.
Unplanned downtime occurs when equipment is scheduled to operate but is unable to do so due to unplanned circumstances. Equipment breakdowns, unplanned maintenance, a shortage of operators or resources etc.
Planned downtime occurs when equipment is set for production but is unable to do so due to planned circumstances. Changeover, tooling adjustment, cleaning, scheduled maintenance, and quality inspection are just a few examples.
Performance: The ratio of the number of components produced to the theoretical maximum number of components that might have been produced in the period the machine was running. Inspection, insert changes, tool breakage, and other factors might create a difference between the start and end of a cycle.
Quality: The percentage of components that pass quality inspection compared to the total number of components produced. The number of components rejected is the difference. On the shop floor, OEE allows you to measure and reduce waste. It’s a single number that everyone understands, from the machine operator to the President. It may be tracked and improved on month to month.
- Available time in a day = 20 hours (short feast breaks and shift changes)
- Running time = 15 hours (5 hours lost because of breakdowns, setup change)
- Theoretical production=220 parts
- Actual production=200
- Parts Good production=180
- Availability= 15/20 = 75
- Performance= 200/220 = 9
- OEE = A x P x Q = 0.75 x 0.9 x 0.9 = 61
This figure indicates that only 61% of the available capacity is being utilized, with the remaining 39% being wasted. That’s terrible, but it’s a lot better than the usual shop floor. In terms of return on investment, 61% OEE is equivalent to paying for a banana and receiving just 3/5 of it.
You can’t improve your OEE unless you measure and track it, as well as its components A, P, and Q, on a regular basis. Your OEE optimization approach must include a Machine Monitoring System that tracks Production, Machine Downtime, and Rejections automatically.
Decoding TEEP (Total Equipment Effective Performance)
What is TEEP (Total Equipment Effective Performance)?
My security guard is willing to guard my house 24hours a day, but I tell him to guard my house for only 12 hours. OEE measures how effectively he is doing the job in 12 hours. TEEP, whereas, measures the same, and in addition, also measures the extent of my stupidity in stating him to work only 12 hours a day while he was willing to work for 24 hours straight.
Losses on the shop floor can be classified as Equipment losses and Schedule losses. Loss occurred when the machine is scheduled to run are called as Equipment loss. We can measured it by OEE.
Schedule losses are concerned to the period when the machine was not scheduled to run but was still available to do so. For example, Lunch and tea breaks, non-working shifts, holidays, and no orders. This is measured as Utilization.
OEE vs. TEEP
- TEEP considers both equipment and schedule losses, i.e. OEE & Utilization
- OEE measures how efficiently you spent your scheduled production time
- TEEP measures how efficiently you utilized the entire calendar time
- Utilization = Planned Production Time divided by Total Available Calendar Time
- TEEP = OEE and Utilization multiplied
A machine’s OEE is 70 %. It runs 24 hours a day without a break, 5 days a week.
The Utilization is 5/7, or 71.42 %.
TEEP = 100 x ((OEE/100) x (Utilization/100)) = 50 %
A machine’s OEE is 60 %.
It works 12 hours a day, with lunch and tea breaks totaling 1.5 hour, 6 days a week, the Utilization is (10.5 x 6)/(24 x 7) = 37.5 %
TEEP = 100 x ((OEE/100) x (Utilization/100)) = 22.5 %
If I take out a bank loan to purchase a machine, the bankers expect to be paid the principle + interest on the loan every month. They don’t care how long I operate the machine. If I only run the machine for 12 hours a day, my revenue is half of what it might be if I operated it 24 hours a day. If orders are not a limitation, it makes sense for me to operate my machine for longer periods of time — 24 hours, across breaks, and so on. TEEP makes more sense as a measure of my capacity to repay the bank loan than OEE. The TEEP definition, TEEP computation and OEE vs. TEEP differences are therefore important to understand.
Calculation of OEE
There are innumerous factors that affect the OEE performance of the company. The main factor in OEE is downtime in manufacturing process. Downtime is defined as the time when a process was intended to execute but did not. This includes unloading / loading of parts, inspection, setup changes, breakdowns, etc. OEE is not just a number for any organization, but it’s a mirror for decision taker to improve and evaluate the performance of the shop floor. It’s not a number that you achieve and sit, relax, but it’s a number that you constantly strive to improve.
Multiple organizations consider unloading / loading, inspection, tool change, setup change downtime as a part of the process but not as downtime. This contradicts the logic about using OEE. It inflates the OEE figure artificially, yet it is worthless.
Availability = Run time divided by Planned Productive Time
Run time = Planned Productive Time minus Downtime
Here’s why you should treat ALL downtimes as downtimes
One can get an artificially high availability of 95% by excluding certain downtime and increasing the numerator in the availability calculation. As a result, one fails to root for a scope of improvement and ends up sitting back and relaxing.
Assume that the setup time for a CNC lathe component is 2 hours. If I don’t consider this as a downtime, this setup time will remain constant for years. If I consider it as a downtime, I will continue trying to decrease it by using quick change tooling, automatic tool pre setter, etc. and similar practice with other downtimes.
There are so many formulas available for calculation of availability (A), performance (P), quality (Q) and OEE. The OEE formula is differ from organization to organization as per their process.
Rather than creating an artificially high OEE number, patting ourselves on the back, and sitting around complacently, we must obtain genuine OEE figures and work to increase it.
Introduction to OEE
Overall Equipment Effectiveness (OEE) is a standard that measures the percentage of manufacturing time that is truly productive. It helps to measure manufacturing and production productivity. OEE supports TPM by carefully tracing the progress and downtimes to achieve the determined target of perfection.
- An OEE score of 100% depicts production excellence.
- An OEE score of 85% depicts ‘almost’ perfect for manufacturers
- An OEE score of 60% depicts typically fair chance for discrete manufacturers
- An OEE score of 40% usually depicts lack of TPM
OEE takes into account the following components that maps with the TPM goals and considers different types of productivity loss.
Goal: Zero Stoppages
What it does? Availability Loss are taken into account that includes events that delay or stop the planned production for a noticeable amount of time. Events like breakdowns (unplanned stops) or changeovers (planned stops) fall in this phase.
Goal: Restrain short stops or Slow cycles
What it does? Performance Loss are taken into consideration that scrutinize the factors that cause machines to operate at less speed than the expected speed when running fall in this phase.
Goal: Zero Defects
What it does? Quality Loss are taken into consideration that look for defects are areas that require rework. Event like Production Rejection is an example of this component.
Goal: Seamless Production
What it does? All the above losses ( Availability, Performance, Quality) are accounted which helps to measure true productive manufacturing time.
To compute the productivity losses, measuring OEE is extremely important so as to measure and trace improvements.
Benefits of Automated OEE Tracking
Performing manual OEE calculations can sure give a kick start since only five details are required ( Planned Production Time, Ideal Cycle Time, Stop Time, Total Count and Good Count ). Manually calculating OEE deepens the knowledge and understanding of OEE. Despite, there are some really strong benefits of inclining towards the automated OEE data calculation.
Some noteworthy benefits are listed below:
- Real time Results: Automated data collection enables real time results which can have an impact on techniques like Short Interval Control (SIV)
- Stoppage Time: With automatic detection methods, the accuracy of tracing unplanned stop time can be 100%, while it is typically between 60% to 80% for manual calculation
- Short Stops and Slow Cycles: Practically, it is impossible to manually track short stops and slow cycles for most of the equipments. Due to this enormous amount of useful information like event and time-based loss patterns can never be figured.
- Operator Focus: Automated data collection helps operator spend quality time, focusing directly on the machine rather than wasting time on paperwork and calculations.
How to create perfect OEE Goal?
One of the important question that strikes in everyone’s mind is how to set 100% effective, perfect goal for OEE. There is this great way, a technique for doing Best of the Best. Below are the details of its working:
- Track OEE components like Availability, Performance and Quality of the targeted equipment for at least one month. Don’t forget to compile the data by shifts.
- Keep track of the best (highest) individual results of Availability Performance and Quality by evaluating resultant data of each shift.
Multiply this best individual scores together and calculate Best of Best OEE score
Six Big Losses of OEE
The Six Big Losses are utmost important to know as they are nearly generic in all the applications universally for manufacturing and they are the most common causes of productivity loss. This losses are nothing but the broken parts of the OEE components -Availability Loss, Performance Loss and Quality Loss. They can provide a great starting framework to ponder over.
It is an Availability Loss. Unplanned stoppages account for any stipulated amount of time when an equipment is scheduled for production but isn’t running due to some sort of failure. Some common failure examples include equipment failure, breakdowns, unplanned maintenance, etc.
Setup and Adjustments
This loss is usually addressed through setup time reduction programs. This an availability loss which can be termed as planned stoppage. This happens when a machine is scheduled for production but is not running because of tools adjustment or changeover or material shortage.
Small stops happen when a running equipment stops for a very short period of time (a minute or two) which is resolved and restarted by the concerned operator. This is a performance loss and also known as Idling and Minor stop. Some common reason of such failure are misfeeds, material jams, quick cleaning, blocked sensors, etc
This issue accounts for the event when an equipment runs slower that its expected or the ideal cycle time. Slow Cycles is a Performance Loss. Anything that prevents the machine from running at its nameplate capacity can be put under this category.
It raises attention on the rejection of products due to defective parts produced during stable (or steady) production state. Production (or process) defects are quality loss since OEE measures quality from the First Pass Yield perspective.
Reduced Yield Startup Rejects
It consists of the defective parts that are produced by startup until stable (or steady) production is reached. It includes both rework able and scrapped parts as per OEE quality measures. Also known as reduced yield, is a Quality Loss. Some examples are incorrect settings, suboptimal changeovers, wrong warm-up cycles, etc