What is OEE, why do manufacturers need to measure it, and how is it calculated?

What is OEE productivity graphic

What is OEE?

Put simply, OEE (Overall Equipment Effectiveness) is a measure of how well a manufacturing operation is running compared to its full potential. It is represented as a percentage of actual useful production / potential production. Perfect productivity or 100% OEE would mean that production time and resources (production assets and material) are being used to their full potential. Or in other words, all production assets are being used without interruption, operating at optimum speed and only producing good product.​

Why do manufacturers need to measure OEE?

OEE is the manufacturing industry standard for measuring productivity. This is for good reason, it enables manufacturers to gain valuable insights into optimising their operations.​

Measuring OEE enables manufacturers to:​

  • Establish their productivity baseline​
  • Identify changes to their productivity baseline​
  • Root cause the changes in productivity​
  • Reinforce activities with a positive impact on productivity​
  • Remediate activities with a negative impact on productivity​
  • Measure the actual impact of continuous improvement initiatives​
  • Use their OEE measurement as a fundamental input into their forecasting models​

In summary it enables manufacturers to make better decisions.

How is OEE calculated?

OEE is comprised of three components; availability, performance and quality, each represented as a percentage:​

Availability (%) – the amount of time spent making product as a proportion of total available asset production time​

  • Time spent making product / Total available asset production time​
  • Uptime / Total time = (Total time – Downtime) / Total time = 1 – (Downtime / Total time)​
  • 100% Availability = all available production time is spent making product, or simply no downtime​

Performance (%) – this represents the rate of making product (during uptime) as a proportion of the ideal production rate​

  • Rate of product being made / Ideal rate of product being made​
  • (Amount of product made / Uptime)  / (Ideal production rate)​
  • 100% Performance = product is being made at the ideal production rate​

Quality (%) – the proportion of good products made to total number of products made​

  • Number of good products made / Total products made​
  • 100% Quality = all products made are good​

OEE is calculated by multiplying these 3 components together:​

OEE (%) = Availability (%) x Performance (%) x Quality (%)​

How can Mavarick help you measure and benefit from​ tracking OEE?

Mavarick offers easy to use machine monitoring software designed to streamline the process of measuring OEE for manufacturers. With our intuitive platform, manufacturers can easily collect real-time data from their production lines, helping them accurately assess machine efficiency, downtime, and product quality. Our software enables Managers and Directors to identify areas for improvement and make data-driven decisions to optimise their production processes.

By partnering with Mavarick, you can easily track and enhance your OEE, ultimately improving productivity and boosting profitability.