Operational Equipment Effectiveness

In this tutorial, we want to examine OEE for our plant. Our plant builds widgets, and we know we have a problem somewhere as we aren’t producing what we expect to produce and keep falling behind in customer orders. In addition, some of our customers are returning widgets saying they are dead on arrival.

A bit of background on our widget plant - we run 3 shifts a day at 7 hours a shift. Each shift has a 30 minute break during the shift, and there is a handover time between shifts of 30 minutes. We only produce widgets, there is no changeover of parts during production. We also know that over a 24 hour period, we are repairing machinery on average 4 hours a day. We know we can produce around 60 widgets a minute, which, based on the 21 hours we expect to operate, is 75600 widgets in a day. But we only produced 51200. Out of those widgets, our customers are returning 8000 of them as dead.

To analyse this, we’ll put together a Value Driver Model.

OEE, or Operational Equipment Effectiveness is a percentage figure comparing what could be produced in the process against what is actually being produced. The OEE calculation is Availability * Performance * Quality.

The driver model will start off with a single OEE node that we will then continually break down into constituent nodes. We will then run what if scenarios to determine the best course of action to improve our OEE, and hopefully meet our customer’s orders to a higher quality.