OEE KPI ‘s: Background

Why are there several OEE KPI’s?

“(Why) do we need different OEE KPI?” When the OEE Industry Standard team started, there were many similar discussions and argumentations heard.
A basic statement was: OEE measures the effectiveness of a machine, the equipment.

Is OEE a KPI for Operations Effectiveness?

If well defined, this of course can tell us a lot about how effective the organization uses this equipment. But also about the surrounding equipment and even the supply-chain. However, OEE is not the KPI for “operations effectiveness” or “Asset Utilization”, although it’s loss-structure is an essential part of such KPI’s.

The OEE KPI is a shopfloor tool

The reason for this decision is the principal choice that OEE is a shopfloor tool, a metric that can be influenced by the shopfloor team. Of course, now there are some ‘grey zones’. How far can the span of control of a shopfloor team stretch? And what is the definition of a ‘shopfloor team’?

One dataset serves all!

Nevertheless, using the same (OEE) data, yet stretching the time-frame more or less, can result in a different ‘scope’ that may be interesting to a different audience. Particularly to the operations- and upper management.

To clarify what we are looking at, what scope is used by what audience, we defined some different scopes that are commonly extracted from OEE data.

OEE Industry Standard: Definition – Scope

You will see several different formats of the same loss-structure data set.
I agree this is all a matter of nomenclature, but this diagram shows that we are talking about the same loss-data structure. It is just a matter of reshuffling it in different ratios, for the purpose of gaining focus to different audiences.

OEE KPI ‘s to create a unified language

Important is to create a clear ‘language’ and to use each tool for its most suitable purpose. We want to prevent the ‘abuse’ of tools for different purposes just because it is there and could be used. (You will understand I hate to see Bahco wrenches and pliers in the factory for the same reason.)
Although slightly outside the scope of the OEE Industry Standard, the different ‘scopes’ are part of the standard. However, they were never subject to serious discussions and reviews.

It seems for the new 2020 standard this would be a fine moment to do so. I would like to invite you to review the currently defined scopes and comment them:

  • Are they clearly enough defined?
  • Do they fulfill your needs?
  • Are there already other standards that could be included here?

To do so a dedicated (open) group is started to discuss the standard, http://www.linkedin.com/groups/OEE-Industry-Standard-4246823
I hope together we can further improve the standard.

See also:

OEE – OOE – TEEP explained

Quality Rate can not be determined immediately

Q:  Sometimes our process is being interrupted; i.e. the oven is stopped at a different moment than planned. At that moment it is not clear whether the product will be OK or not. We will block the product and take samples to determine the quality. This could take a couple of days. Wen everything is OK the product is released, otherwise it is being scrapped. This would have a retrospective effect on the OEE I guess? A correct quality rate -and thus OEE- for the day is no longer possible in this way. What number should I now use?

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Calculate a monthly OEE

Q: My boss wants me to calculate and present a graphical OEE representation on a monthly basis. I present this as I do with the daily data. I calculate the monthly OEE  by taking the average of the daily OEE’s.

Is it alright to present a monthly OEE of the machines by calculating the average of the daily OEE’s in a month?

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Calculate OEE over multiple shifts

Q: My boss wants me to calculate and present a graphical OEE representation per week or month. So we need to calculate an average OEE over multiple shifts. I present this as I do with the daily data. I calculate the monthly OEE by taking the average of the daily OEE’s.

Is it alright to present a monthly OEE of the machines by calculating the average of several daily OEE’s in a month?

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How to calculate OEE with mixed output?

Q: Our machine can run mixed output, so several different products, each shift. Till now we just recorded the time the machine was running and the output we had. Our software now requires that we register activities and quantities to account for every minute in a shift. But we are not tracking the number of minutes it ran each product.
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