It is common in industry to measure the utilization or the closely related OEE. It is a bit more difficult, however, to set targets for these KPI. Often you hear people wanting or demanding an OEE as high as possible, with a long-term target of ideally 100%. That is often problematic. The utilization or OEE is unfortunately not a clear cut target that you can simply maximize. Let me explain…
If imitation is the sincerest form of flattery, the OEE (Overall Equipment Effectiveness or Efficiency) is indeed one of the most appreciated measures in lean. I counted at least eight different variants and adaptions of the basic OEE – although let me tell you that I am not impressed with all of them. Many of them seem to be theoretical academic constructs with little meaning for your shop floor. Also, identical acronyms and similar terms are often used in a completely different way, adding quite a bit to the confusion. On top of that, I think the OEE is used way too much in industry where it does not make sense, and many OEE numbers are heavily fudged. Anyway, let me show you the many different flavors of the OEE.
Maybe you have seen a formula similar to OEE = A x P x Q. I see this formula often, but for me it is a very impractical way to calculate the OEE. Let me show you why by comparing the three different ways to calculate an OEE.
One popular and well-known concept of the Toyota Production System is the elimination of waste, in Japanese also called muda (無駄). It is one of the three evils of manufacturing systems, the others being unevenness (mura, 斑) and overburden (muri, 無理). In this post I would like to go through the details of waste with you. This includes the traditional seven types of waste – of which I am a big fan. For completeness sake I also included a lot more types of waste I have come across in industry. However, you have to decide yourself if these additional wastes are not themselves a waste.
Measuring the Overall Equipment Effectiveness (OEE) is one thing, but before you measure the OEE you should know when and where you actually need the OEE to improve your industry. This post describes what the OEE is good for and what it’s not.
The Overall Equipment Effectiveness (OEE) is by far and wide the most lied-about and fudged measurement on the shop floor, both intentionally or by accident. This post tells you the top three different ways how an OEE is fudged, so you know which OEE to trust and which one not.
There is quite a difference between knowing in theory how to measure an Overall Equipment Effectiveness (OEE), and actually measuring it in practice. This post will give crucial tips and points on how to measure the OEE on a real shop floor.
OEE, the abbreviation for Overall Equipment Effectiveness (or sometimes Overall Equipment Efficiency), is a measure of the utilization of a machine. It is frequently used on the shop floor, often determines part of the performance-based compensation of the managers, and is by far and wide the most lied-about and fudged measurement on the shop floor.