1. WHAT IS OEE?
2. HOW TO CALCULATE OEE?
3. UNDERTSAND THE MEANING OF OEE
4. WHY IS OEE SO IMPORTANT?
5. HOW TO MEASURE OEE?
1. WHAT IS OEE?
OEE, Overall Equipment Effectiveness, is the gold standard for measuring production efficiency.
It stands for the percentage of manufacturing time that is truly productive. An OEE score of 100% means perfect production: manufacturing only good parts, as fast as possible, with no stop time.
OEE is a lean manufacturing tool and universal best practice which helps to monitor and improve the effectiveness of a production process.
2. HOW TO CALCULATE OEE?
OEE is the result of three factors: Availability, Performance and Quality.
Availability: is the machine operating?
Availability is the ratio of Actual Production Time to Potential Production Time. Actual Production Time identifies the Planned production time minus availability loss, both unplanned downtime (e.g., equipment failures, material shortages) and planned downtime (e.g., changeover).
Availability = Actual Production Time / Potential Production Time
For example, if the machine operates 408 minutes during an 8-hour shift (480 minutes):
Availability: 408 / 480 = 85%
It means that the 15% of availability is lost.
Performance: how fast is the machine running?
The performance percentage is the ratio of Actual Output to Theoretical Output. Actual Output identifies the output produced in case of maximum speed less performance losses, such as stoppages and reduced speed.
Performance = Actual Output / Theoretical Output
For example, if the machine operates 408 minutes and produces 10 pieces/minute, then:
Theoretical Output: 408 x 10 = 4080 pieces
Actual Output: 3060 pieces (it includes all pieces, both good and rejected)
Performance: 3060 / 4080 = 75%
Quality: how many products met the quality requirements?
Quality is the ratio of Good Parts manufactured to Total Output.
Quality considers Quality Loss, which excludes manufactured pieces that do not meet quality standards or are later reworked.
Quality = Good Count / Total Output
For example, if the machine produces 3060 pieces and 2754 pieces met the quality standards:
Quality: 2754 / 3060 = 90%
OEE
The OEE results from the multiplication of the Availability rate, Performance rate and Quality rate.
OEE = availability x performance x quality
OEE = 85% x 75% x 90% = 57%
3. WHAT IS THE MEANING OF OEE?
We already mentioned that an OEE score of 100% represents the perfect production, but what is the meaning of a lower percentage? What is considered a good OEE score?
85% OEE
It is a world-class score and a proper long-term goal.
60% OEE
It’s a discrete result but indicates there is significant room for improvement.
40% OEE
It is considered a low score and is common for manufacturers that are just starting to track their production performance.
The reality is that most manufacturing companies’ OEE scores are closer to 40-60%. An OEE score of 85% is difficult to achieve for most companies, then the focus of a manufacturer should be just on raising the OEE, identifying the reasons of losses and implementing remedial actions.
4. WHY OEE IS SO IMPORTANT FOR WIRE MANUFACTURERS?
The Overall Equipment Effectiveness is one of the most relevant KPIs in modern manufacturing facilities. It is a key lever to increase capacity, reduce costs, improve quality and efficiencies throughout the production lines.
The OEE optimization can release the capacity potential of a company, increasing production and making the operation more efficient and cost-effective.
Using OEE in manufacturing allows you to:
– Improve production process quality
– use machinery to its full capacity, reducing the need for further investment
– reduce machines maintenance and repair costs
– have a complete view of the production process, including main issues and their impact on the production performance
– deliver meaningful return on investment
– be competitive
– Improve the scalability of production process
– track progress over time
– compare the performance of a production asset to industry standards, other in-house assets, or different shifts.
5. HOW TO COLLECT DATA FOR OEE?
One of the most common ways to collect data for OEE is operator records.
Although it is widely used, it ignores all stops below a certain length and the quality of records can vary from operator to operator.
With the advent of industry 4.0, the most competitive companies have adopted a digital data monitoring system on their production lines which records the machines operation. The collected data is directly sent to the analytics engine to deliver relevant and actionable data for managers and operators to use.
MFL X Acumen is a proprietary multi-platform and highly modular Industrial IoT Application, which among other features, offers fully automated monitoring of OEE.
At MFL X, we help our customers harvest that value by leveraging Exponential Technologies (i.e. Industrial IoT, Big Data & Artificial Intelligence) and by developing smart industrial applications that digitally enhance production lines.
How does MFL X Acumen help you in accurately monitoring OEE?
– real-time monitoring
– precise data by eliminating human error in data entry and performance calculation
– measurement of OEE for a single reel or spool, line, operator, shift, product, factory, offering immediate aggregation and break down of data
– automatic performance measurement according to the type of wire, cable or rope, since each product has a specific theoretical maximum speed
– real-time quality rate measurement in case the quality control is in-line. If not, it is possible to structure an automatic flow of data coming from the laboratory
– possibility to set push notifications to let you know when OEE falls below a certain value
– availability of historical data and alerts trend
The strongest point of MFL X Acumem lies in its continuous crowd-driven development and improvement, thanks to the feedback from a variety of stakeholders such as, MFL Group users, MFL
Group customers, other OEMs also customers of 40Factory (the developer) and their respective End-users.
The application is modular and scalable, and it is designed to connect any industrial machine. For MFL, that means even connecting third-party equipment.
If you want to know more about MFL X Acumen and how to use it to operate at your true production potential and remain competitive in the advent of Industry 4.0, reserve a meeting here
Sources: The Correct Way to Calculate OEE, OEE Academy, https://oee.academy/oee-standard/oee-calculation-definition/ Should OEE be 85%? Is our target 85% OEE?, OEE Academy, https://oee.academy/oee-academy/oee-and-continuous-improvement/oee-85-percent-target/