Overall Equipment Effectiveness

Table of contents

OEE (Overall Equipment Effectiveness) is one of the most important analytical tools used in modern production management. It synthesises the efficiency of the use of machinery and equipment in a production facility. With OEE, it is possible not only to monitor the current state, but above all to identify areas requiring optimisation.

OEE is the product of three basic indicators

1. Availability

It is a measure of this, how long the machine was actually available for operationin relation to the planned duration of its operation. This indicator shall take into account any unscheduled downtime, such as:
  • technical failures,
  • shortages of raw materials,
  • organisational downtime,
  • tool changes or changeovers.
However, it does not cover planned downtime, e.g. relating to shift schedules or maintenance periods.

2. performance

Performance determines, how efficiently the machine worked during its availability. It is measured as the ratio of the number of units produced to the maximum number of units the machine could produce under ideal conditions. This indicator takes into account:
  • micro-stops,
  • slower work than anticipated,
  • production start-up problems,
  • short line stops.

3 Quality

Quality is ratio of good (compliant) products to all products produced. Any shortages, waste or products that need to be corrected reduce this indicator.

What does the OEE indicator show?

OEE is a percentage measure that shows, to what extent the company makes optimum use of its machinery. Its value ranges from 0 to 100%.

Interpretation of OEE

  • 85% and more - world-class performance, very high operational efficiency,
  • 60-80% - moderate efficiency with potential for improvement,
  • Below 60% - the need for urgent analysis and implementation of improvement measures.

Why measure OEE?

The OEE indicator is a diagnostic tool that allows:
  • identify production bottlenecks,
  • identify the main sources of losses,
  • target corrective and optimisation measures,
  • monitor the effects of implemented changes,
  • support investment and planning decisions.
With OEE analysis, you can not only improve the efficiency of a single machine, but also increase the productivity of the entire production line i increase in plant profitability.

How to analyse OEE in practice?

Regular analysis of the OEE indicator for each machine or production line allows:
  • see the actual working time of the machine,
  • identify the biggest sources of loss,
  • prioritise optimisation activities,
  • compare efficiency between departments, shifts or production lines.
OEE is not just a number - it is a tool showing exactly where we are losing time, quality and money.

Conclusion

OEE (Overall Equipment Effectiveness) is not only a technical indicator, but a strategic tool for production management. Regular monitoring of its value and analysis of individual components enables better decisions to be taken, eliminating waste and building a culture of continuous improvement.

Author:

Ireneusz Ochman

Lean Management expert with extensive practice in industry and services. For years he has been helping companies to increase efficiency, organise processes, make better use of available resources and implement modern management systems. Managing Partner at BE Partners.