# OEE - The meaning of the single number

#### Mikael

##### Quite Involved in Discussions
Hi

Besides for benchmark and knowing that OEE consist of Availability, Performance and Quality, can I then conclude something from the number, isolated ? So lik 85% OEE means ... ?

M

#### msec0990

While this is something I don't normally deal with (I actually had to look up the acronym) I was able to find the following website: oeefoundation.org

For those like me: OEE = Overall Equipment Effectiveness

Very basically, the website states that the "average" machine runs about 35-45%. The claim is that it really boils down to how it's defined and who is actually doing the measuring. Personally, I don't feel those are numbers I would brag about.

Anyway, I hope this helps.

Mark

Last edited by a moderator:

#### Mikael

##### Quite Involved in Discussions
Thx, though I have a dozen of explanation on the concept, but others hopefully finds it interesting. At oeecoach I found for me that it gave the best explanation, so I recommend

#### somashekar

Staff member
Super Moderator
Its an equipment not a human.
Its there for you begging to be used.
Are you using it 85% ... What is preventing you for not using the 15% ?
Have a project for that ?
OR
Management is satisfied that OEE is 85% ... ?
Don't worry, it will not resign and go elsewhere

#### reynald

##### Quite Involved in Discussions
I think the formula is like
OEE = Availability X Utilization X Yield.

The logic is that given 24 hours, the machine may only be available let's say 90%.
But then even when it is available, it is utilized only 80%.

And for the times it is utilized, it produces only good parts 80%.

From that you can get the real effectiveness of the machine, i.e. the percentage it actually gives value.

#### Mikael

##### Quite Involved in Discussions
Thx, although I dont think you understand my Question. I know very well how it is calculated, and I know what A., P. and Q. means. Separately I can formulate what they tell, but for OEE I can only tell that it is base on the others and use for comparison.

Perhaps I should ask in another way, why not take the average of the 3 components instead?

Last edited:

#### Bev D

##### Heretical Statistician
Staff member
Super Moderator
Mikael - perhaps you could ask your question differently. what is it about OEE that you don't understand: how it is used?

perhaps this is simply a language problem but you seem to be saying that you understand it from a computational perspective, yet you then ask why averages can't be used?

Of course the average availability and productivity could be used ('average yield' is actually total yield percentage if calculated correctly) but it would not be an accurate calculation of OEE.

Based on some of your previous posts I would also add that OEE is not a very good Lean metric as it approaches 100% only when the equipment is running 100% of the time. This is desired in the 'push' world where management is trying to get the most out of its capital assets, but unless every operation is running 100% and single piece flow is occurring, then you have overproduction and excess inventory which are wastes in the lean 'pull' world.

#### Mikael

##### Quite Involved in Discussions
Well you don't need to set the target for 100%! Also you have both OEE, OOE and TEEP.

Anyway let me try to ask like this:

Availability = is about capacity time utilisation.

Quality = is about "quantitative quality", output, that is good vs. bad products.

AVA%*PER%*QUA% = OEE% = is about the "overall" yes but what does it mean? tells you that ... ? OEE of 75% tells you that 75% of .... ....

(AVA+PER+QUA)/3 = is about ? tells you that - average yes, but means that ...

#### reynald

##### Quite Involved in Discussions
The concept is analogous to Rolled Throughput Yield, i.e the output of process1 is the input of process2 while the output of process2 is the input of process3. If you have the yield of all three processes, the overall yield = output of process3/input process1 = Y1*Y2*Y3. You don't average as AVG(Y1,Y2,Y3).

The same goes with OEE, you can only utilize the fraction that is available, and %correctly utilized only makes sense from the fraction that is utilized. That is why you take their products

#### Bev D

##### Heretical Statistician
Staff member
Super Moderator
Anyway let me try to ask like this:

AVA%*PER%*QUA% = OEE% = is about the "overall" yes but what does it mean? tells you that ... ? OEE of 75% tells you that 75% of .... ....
it's a straightforward measure: as explained previously, if your OEE is 75% then you are only achieving 75% of the potential output capacity.

(AVA+PER+QUA)/3 = is about ? tells you that - average yes, but means that ...
this formula is nonsensical. adding the 3 measures values is not the correct way - mathematically - to determine equipment utilization...they are like standard deviations. they must be combined as in the above formula. so dividing an incorrect number by 3 tells you nothing as well. this formula doesn't give you the average. You will need to calculate the average availability and the average performance over some period of time and then multiply the 3 proportions together to get the average OEE...

OEE and In-process Inspection Manufacturing and Related Processes 2
Add-On software for VMC to calculate setting time, Idle Time, OEE etc.. Manufacturing and Related Processes 2
J How to Calculate OEE Indicator for a Workshop (15 Machines) Lean in Manufacturing and Service Industries 6
When do I need to calculate Process OEE? Manufacturing and Related Processes 12
Can OEE (overall equipment effectiveness) exceed 100%? Manufacturing and Related Processes 2
Overview of the relations between OEE and SCOR Quality Tools, Improvement and Analysis 1
Where does OEE (Overall Equipment Effectiveness) belong? Quality Tools, Improvement and Analysis 11
L OEE (Overall Equipment Effectiveness) and Cost Savings Manufacturing and Related Processes 2
S Measuring OEE (Overall Equipment Effectiveness) for each Job, not for Machine Lean in Manufacturing and Service Industries 2
J Correlation between OEE and FMEA FMEA and Control Plans 2
OEE (Overall Equipment Effectiveness/Efficiency) Help Lean in Manufacturing and Service Industries 14
P How to clean paint area tile faster and improve OEE Manufacturing and Related Processes 3
D Overall Equipment Effectiveness (OEE) Calculations Manufacturing and Related Processes 4
OEE (Overall Equipment Efficiency) on Pharma Packaging Lines Lean in Manufacturing and Service Industries 8
Y OEE (Overall Equipment Efficiency) help Lean in Manufacturing and Service Industries 6
R Building an OEE System to our Production Lines - New concepts to me Lean in Manufacturing and Service Industries 12
Information sharing: Week 22, 2010 (TPM, OEE) The Reading Room 1
S OEE (Overall Equipment Efficiency) - One question Manufacturing and Related Processes 17
M Calculating OEE Performance Measurement for a CNC Plasma Cutter Manufacturing and Related Processes 19
C Has anyone ever heard of Informance software? Monitors machine uptime/downtime (OEE) Preventive Action and Continuous Improvement 11
S OEE Software - Automating the collection of Overall Equipment Efficiency data Statistical Analysis Tools, Techniques and SPC 8
P OEE (Overall Equipment Efficiency) and Downtime Manufacturing and Related Processes 17
A OEE for Food Manufacturing - Non Dairy creamer manufacturing Manufacturing and Related Processes 1
V Overall Equipment Efficiency (OEE) calculation of 2 different scenarios. Manufacturing and Related Processes 5
P OEE - Is there a company that offers a better display than others? And how effective Lean in Manufacturing and Service Industries 19
M OEE (Overall Equipment Effectiveness) Downtimes Calculation Manufacturing and Related Processes 8
E Control Charts for OEE (Overall Equipment Efficiency) Statistical Analysis Tools, Techniques and SPC 19
L Determining Coordinate Measuring Machine (CMM) OEE General Measurement Device and Calibration Topics 2
Definition OEE definition - Overall Equipment Effectiveness - Definition of A (Availability) Definitions, Acronyms, Abbreviations and Interpretations Listed Alphabetically 7
Definition OEE (Overall Equipment Effectiveness) - Initials and Definition Definitions, Acronyms, Abbreviations and Interpretations Listed Alphabetically 0
A Overall equipment effectiveness - Computing OEE taking all machines taken together Manufacturing and Related Processes 12
H OEE (Overall Equipment Effectiveness) and Run at Rate IATF 16949 - Automotive Quality Systems Standard 5
P How Do I Measure Productivity? Throughput yield? OEE measures? Misc. Quality Assurance and Business Systems Related Topics 3
A OEE - Overall Equipment Effectiveness QS-9000 - American Automotive Manufacturers Standard 1
A OEE - Overall Equipment Effectiveness - A Ford Requirement Customer and Company Specific Requirements 7
FDA will not tolerate fraud…meaning what, exactly? Other US Medical Device Regulations 8
FDA 21 CFR Part 11 "Meaning of Signature" Other US Medical Device Regulations 6
Definition Defined - Definition and meaning of "defined" Definitions, Acronyms, Abbreviations and Interpretations Listed Alphabetically 10
Meaning of Annex II, excluding point Clause 4 conformity CE Marking (Conformité Européene) / CB Scheme 4
T Supplier monitoring - The meaning of "8.4.2.4 " Customer disruptions IATF 16949 - Automotive Quality Systems Standard 1
E SPC for Dummies - The correct meaning of all the graphs Statistical Analysis Tools, Techniques and SPC 3
E Definition Integrity - The meaning of the word INTEGRITY in ISO 13485 Control of Records Definitions, Acronyms, Abbreviations and Interpretations Listed Alphabetically 6
Definition QUALITY 4.0 - Somebody here could explain the meaning of Quality 4.0? Definitions, Acronyms, Abbreviations and Interpretations Listed Alphabetically 2
EU Definition of Labeling or the meaning of the MDD (Medical Devices) EU Medical Device Regulations 7
N What is the meaning of Suspended in OASIS? AS9100, IAQG, NADCAP and Aerospace related Standards and Requirements 3
C Meaning of "direct diagnosis" (Annex IX, Rule 10) EU Medical Device Regulations 6
G What is the exact meaning of Single Fault condition? EU Medical Device Regulations 4
S ECR - meaning of "Control Item Affected: Yes or no" IATF 16949 - Automotive Quality Systems Standard 1
Do you know the meaning of these words ??? Coffee Break and Water Cooler Discussions 4
UL standard for Lead wire - meaning of UL numbering, AWG#, no. of conductor, etc Various Other Specifications, Standards, and related Requirements 1