Calculation of the Overall Equipment Effectiveness (OEE)

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OEE is an acronym for the term Overall Equipment Effectiveness. In Portuguese, we can translate to General Efficacy of Equipment. This concept is closely linked to the concepts of lean manufactoring and aims to maximize its production line. Basically, this is an indicator that will help you understand the effectiveness and productivity of your production line by taking 3 into consideration:

  1. Productivity
  2. Availability
  3. Quality

Therefore, the classic formula for calculating the OEE indicator is:

OEE% = Availability% * Productivity% * Quality%

Now, let's find out below how to get into each of these intermediate indicators.

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1. Productivity Calculation

This indicator wants to assess whether that particular machine is producing as expected from it. Basically, you want to see how much production it has achieved within the expected time in relation to the total potential.

"Productivity% = (Actual Production Cycle x Actual Production Hours) / (Estimated Production Cycle x Planned Production Hours) * 100%"

Practical example:

Let's say you are evaluating a forklift. You have planned for it to stack 3 boxes per minute and the standard production day is 400 minutes. Therefore, you expect to stack 1200 boxes per day.

However, you gauged that it only actually worked 370 minutes and only managed to stack 2,6 boxes per minute. So only 962 boxes were stacked that day.

So your productivity indicator will be calculated by 962 / 1200 = 80%

2. Availability Calculator

This indicator aims to measure how much the machine was actually available for production. So this takes into account both the time it was planned for it to work and the amount of time it actually worked. Of course, the time available will be influenced directly by scheduled and unscheduled shutdowns.

"Availability% = ((Time Producing / Time Available) * 100%))"

Practical example:

Following the forklift case, let's say you calculated at the start of your day that it, despite having 400 minutes for production, would need to stop 100 minutes for maintenance. However, throughout the day, its maintenance took 150 minutes. So your planned available time was 300 minutes, but it only actually produced 250 minutes.

So your availability indicator would be 250 / 300 = 83%

3. Quality Calculation

This last indicator will evaluate if the output coming from your machines is really useful. Let's continue with the forklift. For example, let's say that from time to time the boxes are positioned incorrectly and therefore must be replaced.

"Quality% = (Correct Production / Total Production) * 100%"

Practical example:

Following the 1 case data, on an ordinary day you can stack 1200 boxes. However, throughout the day, you noticed that 100 boxes were crooked offering a risk of falling and had to be replaced. That is, 1.100 boxes were correct.

So your quality indicator would be 1100 / 1200 = 92%

Calculation of OEE

To close the valuation for that day and calculate the Overall Equipment Effectiveness of your forklift, simply merge all previous 3 indicators.

So your OEE indicator would be 92% * 83% * 80% = 61%

Of course, the OEE calculation is closely linked with quality management which you should delve into. Another suggestion is our machines stop control worksheet which automatically calculates your OEE.

If you still have any questions, check out this cool video:

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