We recently received this helpful approach to World Class OEE calculations from Parsec Corporation. As a Parsec Certified Solution Partner, we wanted to share with you.
Back-of-the-Envelope OEE in 5 Steps
While calculating and improving your own OEE always adds value to your organization, it helps to know where others stand to truly benchmark your OEE levels. In comes World Class OEE.
By general consensus World Class OEE is 85% or higher. By contrast, most manufacturing plants have an OEE in the range of 30 – 60%. Additionally, it is not unusual for these plants to experience daily fluctuations of about 10%. The components to World Class OEE are as follows. Availability of 90%, Performance of 95%, and a Quality of 99.9%. Using the formula A x P x Q, you arrive at 85% OEE.
Given that many manufacturing companies believe they are running at an efficiency of 85 – 90% (which is true due to the way they currently measure efficiency), it is very helpful to get an idea of the true potential for improvement by performing a rough back-of-the-envelope calculation of the current OEE.
The back-of-the-envelope calculation will lack the detail (breakdown of Availability, Performance, and Quality and the detailed reasons behind all the stoppages), but it will provide a good idea of where your production lines really stand at the moment. This back-of-the- envelope calculation is astoundingly easy to perform.
The process is described below in 5 simple steps:
1 – LINE
Select a line, work cell, or machine to perform this calculation on. Select one that you will already have accurate production numbers.
2 – OEE CALCULATION TIME PERIOD
Select a period of time that is long enough to account for any major periodic Availability related downtimes that will occur. For instance, if your line runs continuously for two days, and then must be stopped for a CIP (Clean-in-Place; sanitation) for four hours every third day, run your calculation over that three-day period.
3 – TIME NOT SCHEDULED
During the OEE calculation time period, you need to determine how many minutes the line was not scheduled to be used for any productive purpose (changeover, sanitation, preventive maintenance, etc. are productive purposes). This is the time that you had no production requirements. For instance, if your plant only works two shifts, then the third shift time would be looked at as “not scheduled”. On the other hand, if the third shift was used for Preventative Maintenance, then this would be viewed as scheduled time.
4 – THEORETICAL RATE
You will need to know the real theoretical rate of the line based on the equipment specifications for each SKU run on the line during the OEE calculation time period being measured. This is the rate the equipment was to provide when purchased, NOT the rate that operators may currently be running the equipment at. This can be in any units (cases/ hr., units/min., feet/min., lbs./hr., etc.). Please note that this information is gathered from equipment manuals, not calculated or gathered from how your line is performing on its best day.
5 – GOOD PRODUCT PRODUCED
For each SKU, you will need to know the quantity of good product produced in units equivalent to your theoretical rate units (i.e., be consistent with your units, cases, individual units, pallets, etc.).
If all the SKUs run during the OEE calculation time period have the same theoretical rate, then you have all the information you need to complete the calculation.
Want to explore solutions to achieve World Class OEE? Give us a call today.