OEE stands for Overall Equipment Effectiveness. The formula for calculating it is as follows:
- OEE= Degree of availability x Degree of performance x Degree of quality.
- OEE= Possible production time / Actual production time x Possible output / Actual output x Actual output / Flawless products
This formula was developed by the Japanese Seiichi Nakajima and helps companies to detect and eliminate losses in production. In an optimal case, a machine runs at its capacity limit and does not cause any waste. In reality, this cannot be achieved because efficiency is affected by the following losses of machinery and equipment:
- Equipment breakdowns
- Set-up and adjustment
- Tool changes
- Start-up losses
- Speed losses
- Short downtimes
- Scrap and rework
- Planned downtimes
The OEE formula shows in which areas losses occur and thus offers the possibility of eliminating them by means of optimisation approaches.