OEE-Overall Equipment Effectiveness

The concept of OEE is quite popular among Manufacturing Industries. It gives a good measure to the concerned authorities that how the Equipment is performing as a whole. It could be of individual stand alone machine or of full line. Though I have known the concept since last 5 years and also have used it many times during my job, but it was also tough to explain it to somebody.

Recently, one of my Professors, Prof Soumish Dev was teaching the concept again as part of Operations Subject. The way he explained it, was simply awesome. I am sharing the same explaination with you.

As can be seen in the picture above. Lets understand the concept from analogy point of view rather than taking it directly to machines and plants.

• Lets assume that there is a student of Engineering, who has 365 days in the year.
• Out of 365 days lets assume that 100 days are for holidays, as no student should study for 365 days. Then 265 days are left. This is known as Loading Time, while 100 days are known as Not Scheduled Time.
• Now, out of planned 265 days of working, student fells ill for aroun 15 days. Now, this gives us actually 250 days, where the student actually worked, and is known as Running Time. While the 15 days are known as Idle Time.
• Now, lets assume that the student claims that at his efficient or effective state of mind an health he can complete 80 pages of a book per day. So, this can be considered as Theoretical Output that is expected during the Running time. So, in this case it would be 250x80=20000 pages in the year. But, actually we found that he has read only 15000 pages. The reasons could be several that reduced his efficiency and effectivenes. So, 15000 pages, is known as Actual Output.
• Now, at the end of the year, teacher took a test of the student. The test was out of 15000 pages he studied during the year. As, the student has read it effectively and efficiently he should have got 100 marks out of 100. But, he got only 70 marks. Now, whats the reason. It means that out of 15000 pages he read only 70% properly. Other 30% was bad quality reading. So, he read only 10500 pages properly and the 4500 pages not properly. So, 10500 can be said as Good Output.

So, now we will calculate the OEE of student during the considered year. It will be comprised of following elements

• Availability i.e. Running Time/Loading Time or we can say actually followed time table w.r.t. planned time table.
• Speed Efficiency i.e. Actual Output/Theoretical output.
• Quality Efficiency i.e. Good Output/Actual Output.

Or if you notice carefully, in the above diagram we have just calculated Good Output/Loading Time.