What is OEE?

Overall Equipment Effectiveness

OEE takes three main factors into account

✅ Accessibility

✅ Performance

✅ Quality

OEE stands for Overall Equipment Effectiveness and is a key performance indicator used to measure the efficiency of production equipment.

Today, OEE is an important part of many companies’ continuous improvement strategies. It is used to identify bottlenecks, reduce downtime, and improve the quality of manufactured goods. By measuring OEE, companies can gain insight into their production processes and find ways to improve efficiency.

OEE takes three main factors into account:

Availability: The percentage of the planned production time during which the machine is actually in operation.
Performance: How fast the machine is running relative to its maximum speed.
Quality: The percentage of units produced that meet quality standards.

Where do the OEE figures come from, and how can PLEET help:

With PLEET, there are several options for collecting the data needed to calculate an OEE, and the method you choose depends entirely on your specific production process.

You can set up a relatively simple interface where PLEET picks up a running signal from your machine via an IoT box; when there is a signal, it means the machine is running, and when there is no signal, the machine has stopped.

Another, somewhat more reliable method is for PLEET to communicate directly with the machine’s control system. This allows downtime and the causes of downtime to be recorded fully automatically.

PLEET has implemented a wide range of standard protocols for communicating with control systems, including:

In addition, PLEET can interface directly with most PLCs to retrieve stop causes, error codes, and speed.

Finally, it is possible to use a completely manual recording process, in which an operator selects “machine stopped” on the PLEET screen and specifies a reason.

To calculate performance , you need to know the theoretical capacity, which PLEET typically retrieves from the order in your ERP system. Similarly to when registering stops, there are several options for capturing a cycle signal from the machine.

The final value – quality—can be entered manually by simply counting the number of rejected items or, as before, by retrieving the number of rejected items directly from the machine’s control system.

Below are three examples of how OEE is calculated in the real world.

Examples of the value of OEE.

Typical manufacturers: Most manufacturers achieve an OEE of 60–75%. This means there is significant room for improvement.
World-class manufacturers: World-class manufacturers achieve an OEE of 85% or higher. This level indicates that production is highly efficient, with minimal downtime and high quality.
100% OEE: An OEE of 100% means that the machine is running at maximum speed, without stopping, and all units produced are of high quality.

By focusing on improving OEE, your company can reduce costs, increase capacity, and improve product quality without necessarily having to invest in new equipment.

Typically, an OEE system such as PLEET visualize the causes, giving you a clear picture of where time is being wasted due to unplanned stoppages.

Here are three examples of how to calculate OEE in three different industries

Example 1: Refrigerator Production Line

A refrigerator manufacturer wants to improve the efficiency of its production line. Over the course of a month, it measures the following:

Planned production time: 720 hours
Operating time: 648 hours (72 hours lost due to maintenance and equipment breakdowns)
Actual production: 5,832 refrigerators
Ideal production: 6,000 refrigerators (based on maximum speed)
Approved units: 5,540 refrigerators (292 refrigerators discarded due to quality issues)

Calculations

OEE Calculation Example for a Refrigerator Production Line

Example 2: Food Processing Plant

A food processing plant wants to reduce waste and improve efficiency. They measure the following over the course of a week:

Estimated production time: 168 hours
Operating time: 150 hours (18 hours lost due to cleaning and maintenance)
Actual production: 300,000 units
Ideal production: 320,000 units (based on maximum speed)
Approved units: 290,000 units (10,000 units discarded due to quality issues)

Calculations

OEE Calculation Example for a Food Processing Plant

Example 3:
Electronics Factory

An electronics factory wants to improve its production line to reduce downtime and improve quality. Over the course of a day, they measure the following:

Estimated production time: 24 hours
Operating time: 20 hours (4 hours lost due to equipment failure)
Actual production: 1,800 units
Ideal production: 2,000 units (based on maximum speed)
Approved units: 1,700 units (100 units discarded due to quality issues)