Overall Equipment Effectiveness (OEE)
Measure of how effectively manufacturing equipment is utilised
What is Overall Equipment Effectiveness (OEE)?
Overall equipment effectiveness is a measure of how well manufacturing equipment is used. It combines availability, performance and quality into a single percentage.
It shows how much of the planned production time is truly productive, and helps find the biggest sources of loss.
How this KPI is measured
- Function
- Operations & Supply Chain
- Sub-function
- Asset Management
- Industry
- Manufacturing
- Type
- Leading
- Impact
- Efficiency
- Unit
- %
- Measurement frequency
- Daily / Weekly
- Formula
- Availability × Performance × Quality (each expressed as a %)
How to calculate it
Multiply availability, performance and quality, each expressed as a percentage.
For example, with availability of 90%, performance of 95% and quality of 98%, OEE is 0.90 x 0.95 x 0.98 = 83.8%.
Availability covers stops, performance covers running slower than ideal, and quality covers defective output. Looking at each part shows where the loss is.
Where it is used
Finding hidden capacity
See lost productive time.
Prioritising improvements
Target the largest loss.
Comparing lines
Benchmark equipment.
How to improve it
Tips and common mistakes
- Use consistent definitions of planned time.
- Do not compare across very different processes.
- OEE is a tool for finding problems, not a target to game.
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