What is OEE Calculation Definition Example Case Study

What is OEE (Overall Equipment Effectiveness)?

→ OEE (Overall Equipment Effectiveness) is an index to judge production run in terms of machine availability, production rate & quality rate of the product.
→ For TPM (Total Productive Maintenance) and Lean Manufacturing programs, OEE is a key metric.
→ It is an important characteristic of capacity planning, material planning, and other resource planning.
→ OEE is also known as TEEP (Total effective equipment performance).
→ Overall Equipment Effectiveness is a Lean Manufacturing Tool.

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What is meant by OEE? (Overall Equipment Effectiveness)

→ There are three parameters for Overall Equipment Effectiveness) monitoring
  1. Availability
  2. Performance
  3. Quality

What is Availability?

→ Availability shows the machine's available duration for manufacturing.
→ In other words, for how much time our machine is available for manufacturing.
→ Availability takes into account of Breakdown Losses.
→ Downtime losses include events or incidents that lead to a stoppage of planned production for a considerable duration.
→ After removing, downtime we can get the operating duration of the machine.
➨ Examples of Downtime:
     ⇢ Equipment failure,
     ⇢ Material shortage,
     ⇢ Excess change over timing, etc...

What is Performance?

→ Performance shows the excess time taken for manufacturing as compared to standard operating timing.
→ The performance takes into account of Speed Losses.
→ The Speed Losses includes any factor that leads to operating production with more cycle time than maximum permissible.
➨ Examples of performance losses:
     ⇢ Low speed of job loading/unloading,
     ⇢ Fatigue of the operator,
     ⇢ Excess cycle time in manual work, etc...

What is Quality Rate in OEE?

→ Quality shows the Good Quality of Product.
→ It takes into account the losses (loss due to the manufacturing of a bad part).
→ Quality loss can only be present due to the manufacturing of a defective part or non-conforming part.

How to calculate OEE?

➨ OEE_Calculation is mentioned in the below picture.


Times and Losses Calculation:

→ Planned Shutdown – Not part of Overall Equipment Effectiveness Calculation.
→ Break Down Loss - Operating timing to Planned Manufacturing timing ratio is called availability when a process runs without any stoppage there will be 100% availability.
→ Speed Loss – It is the ratio of net operating timing to total operating timing or it can be calculated by actual cycle time / ideal cycle time. When the process runs with maximum theoretical speed then performance will be 100%.
→ Quality Loss- it is the ratio of total good parts to a total part produced. When all produced parts are good then there will be 100% quality.

Times and Losses Calculation in_OEE

OEE Calculation Example:

→ Let’s assume below data to understand Overall Equipment Effectiveness calculation
→ Shift Duration = 8 Hours (480 Minutes)
→ Total Breaks = 55 Minutes
→ Break Down = 40 Minutes
→ Ideal Production Rate = 1 Part per Minute
→ Total Part Produced = 350
→ Rejected Parts = 4

➨ Planned Production duration = Total Available Time – Planned Breaks
                                                    = 480 Minutes – 55 Minutes
                                                    = 425 Minutes
➨ Actual Production duration = Planned Production duration – stops (breakdowns)
                                                  = 425 Minutes – 40 Minutes
                                                  = 385 Minutes
➨ Availability (A) = Actual Prod. Time/Planned Prod. Time
                               = 385/425 Minutes
                               = 0.905
➨ Actual Production Rate  = Total Count/Total Run Timing
                                             = 350/385
                                             = 0.909
 ➨ Performance (P) = Actual Production Rate/Ideal Production Rate
                                 = 0.909/1.0
                                 = 0.909
➨ Quality (Q) = Good Parts/Total Parts Produced
                        = (350-4)/350
                        = 0.988
➨ OEE = Availability (A) x Performance (P) x Quality (Q)
              = 0.905 x 0.909 x 0.988
              = 0.812 ~ 81.2 %

OEE Benefits:

→ It helps us to set goals for improvement, and track the progress.
→ Overall Equipment Effectiveness helps us to find inefficiencies in the operation process.
→ It Provides us benchmark data for the new process setup.
→ Overall Equipment Effectiveness helps to track progress in eliminating waste from an operation process.

👉 See Also:


  1. Very good sir ,
    Do you have Excel Template for OEE Calculation?

    1. OEE calculator is very as per the process so you can prepare as per the fundamental knowledge.

  2. Sir it's very useful , thanks 😊

  3. Very useful Thank you Sir

  4. Simple and elegant !

  5. Good to refer the useful topics

  6. Very nice information is provided by term of quality thanks for your efforts Sir

  7. Do you have OEE for services? Or no manufacturing process?

    1. We have OEE for the Manufacturing but we will share for service soon.


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