How to determine Cycle Time?

Q: At my company we are currently doing a book study using your book ‘OEE for the Production Team‘. As we work through the book we came across a question; When calculating OEE do you (the calculation) account for the loading and unloading of material in the machine? We have been calculating the OEE using TAKT time (19 seconds) but the machine cycle time is only (13 seconds). Is this important? Because if there is improvement it will be realized in both versions, correct? In Chapter 9 the exercises do not include load/unload time. Your feedback would be appreciated since material loading is a fundamental function in our facility.
Thank you, Pat Holden

Arno Koch •    When defining the maximum speed for the equipment, many issues come together.

OEE visualizes ALL effectiveness losses

Let’s start with our a basic statement why we use OEE: In OEE we want to uncompromisingly visualize ALL potential equipment effectiveness losses.
So when looking at ‘speed’ we have to ask: ‘Speed of what?’ Yes of course, speed of the equipment, since this is what OEE is measuring. Not the speed of the operator nor the line nor logistics. We want to know “What could the machine theoretically do if it was not restrain in ANY way, versus what is it actually running (due to hundreds of reasons that might become subject to study by kaizen teams etc.) and what is restraining it, where could we improve?

What determines ‘maximum speed’?

Then we find out: The theoretical maximum speed is not determined by the machine alone, but by the combination of the machine and the product it is making. Example: Theoretically it would take 3 times longer to fill a 1 liter bottle than to fill a 33cl bottle, right?

Name Plate Capacity

Now we can talk about the Name Plate Capacity, which is the design speed of the equipment, usually defined based on one ‘norm product’. But the NPC is not suitable for our day to day operation where we run a certain product mix with different characteristics.

The ‘Standard’

We now need to define different speed-groups: products with the same characteristics, having the same maximum speed on the equipment. This maximum is called the “Standard” (the theoretical maximum speed for this product on this machine)
Again: This is the speed the machine could theoretically run this product, would it not have been restraint in ANY way. You will soon end up looking for physical limitations like the amount of energy that could be transferred etc.
The ‘standard’ has NOTHING to do with whatever you think is realistic or realized in practice. It is a reference point that will be stable for the next couple of years until the product or the machine is fundamentally changed.

Is the maximum speed ‘realistic’?

Many people are afraid to define this theoretical maximum speed, since ‘this is not realistic, we will never achieve this’. Well, I do not know if you will never achieve this. I do know that out there are tons of machines that after years, even without TPM, run far over their design capacity! So who knows how far we will get!
It is precisely the goal in this definition that we will not easily trespass the 100% limit of the performance rate, so we will keep a fixed reference point, allowing us to determine over the years whether and how much we are improving.
So the maximum speed value is merely like the north on our compass: It helps us to keep direction, rather than defining we have to go there! Think carefully about this, since it has quite some consequences.
Ok, now you understand why handling is NOT included in the ‘standard’. But how are we going to see ‘handling’ in the OEE?

How will we see (un)loading in the OEE?

Imagine your ‘machine cycle’ (the time the machine theoretically needs to do the actual conversion) is 7 seconds, but before and after this conversion the operator needs time to handle the product: 9 seconds before and 12 seconds after. The ‘product cycle’ is now 9+7+12=28 seconds. Before and after each product, the machine is suffering a minor stop. This will pop-up in the OEE as a speed-loss. When the machine is set to run at 7 second speed, we will now find out your speed-rate will not exceed 25%! And this of course is true: The machine, even when it is ‘running’, still waits 75% of its time for handling! A huge potential is waiting to be found and improved!
I hope this answers your question?

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