# What is OEE (Overall Equipment Effectiveness) Formula, and OEE Calculator

OEE full form is Overall Equipment Effectiveness. As it is clear from the name, it is used to determine how efficiently the machine is running and is a standard for measuring manufacturing productivity in terms of percentage. The goal of the OEE is continuous improvement.

## OEE Calculator

Wattage of Appliance
Running Hours Per Day
KWH Rate (Unit Rate)

An OEE with 100% means, you have produce all the manufactured parts of good quality, as fast as possible with no stop time.

OEE can be used to compare the production of a given asset with respect to the industry standard.

## OEE Benchmarks

OEE as a benchmark signify following:

• 100% OEE is perfect and it means all produced goods are f good quality, as fas as possible with no stop time.
• 85% OEE is world class OEE score and it is a long term goal for many companies.
• 60% OEE means, there are chances of the improvement and considered a fair OEE score.
• 40% OEE score is bad and it signifies, the products quality is not god, stop time is there. There are high chances of improvement.

## Important Terms Related to OEE

Before discussing ahead, let us understand few terms related to OEE, which will help us to understand OEE better.

•  Fully Productive Time – Fully productive time is defined as the Production time after all losses are subtracted
•  Planned Production Time – The total time that has been planned as per requirement
•  Ideal Cycle Time – Ideal cycle time is the time to produce one part
•  Good Count – It is the good quality parts that meet the quality standards.
•  Good Parts – Parts produced that meet standards.
•  Quality -Quality is referred to the manufactured parts that do not meet the quality standards and it also includes those parts which need some kind of rework.
•  Run Time – Run time is the time your equipment or line is scheduled for production and is running
•  Total Count – It is the total number of parts produced including the defecting ones.

## OEE Calculations

OEE is calculated on the basis of various parameters. To calculate the OEE we must understand the following three terms:

• Quality
• Performance
• Availability

Let us understand each term one by one.

### Quality

The products that are being produced might or might not meet quality standards. If it does not meet the quality control specifications, the it is termed as quality loss.

• Rework Loss- These are the losses which are being produced during the normal routine and can be made ok after doing some reowrk on the product to meet the quality standard. Labour is also required to do the rework job which cost to the company. In addition to that, there is loos of the raw material as well. Further more, the energy is also a loss while doing the rework on machines.

Mathematticaly, it is calculated as

Quality = Good Count / Total Count

### Performance

Sometimes there is production stop due to some reasons and Performancce takes into account the number of times there are stops in production. A 100% or good performance score in OEE terms means your operation is running as fast as possible.

Mathematically, it is calculated as

Performance = (Ideal Cycle Time x Total Count) / Run Time

### Availability

Availability takes in account all planned and unplanned stoppage time. A perfect availability score means your operation is constantly running during planned production times.

Mathematically, It is calculated as

Availability = Run Time / Planned Production Time.

Now to calculate OEE, we need to multiply the Performance, Quality and Availability. Mathematically, it can be written as:

OEE = Availability × Performance × Quality

Let’s understand OEE by an practical example:

## OEE Examples

Let us take an example of bottling plant taking a shift time of 8 hours that is 480 minutes. In a shift, operator takes three breaks: one time lunch and two times tea which accounts for overall 50 minutes. Now, in a shift, he takes two changeover, taking total time of 100 minutes.

Now Availability is

= [480- (50+100) ] / 480

= [480-150] / 480

= 330/480

=68.7 percent

Now let us assume that , bottling plant makes 50 bottles per minute. For the remaining 330 minutes, it can produce 16500 bottles. Now let us assume that plant is running as lower cycle time and taking 1.5 seconds to make 50 bottles. Now the performance is

= 1/1.5 = 2/3= 66.7 percent (66.7 percent of 16500 = 11005)

To calculate the quality part, let us say out of 11005, 2000 bottles are not of good quality. So the Quality =

=11005-2000/11005

=81 percent

Now th OEE = Availability × Performance × Quality

= 68.7×66.7×81

=37 percent