Modern Approach To Overall Equipment Effectiveness (oee)

MODERN APPROACH TO OVERALL EQUIPMENT EFFECTIVENESS (OEE)

SEMINAR REPORT Submitted by

KAILAS SREE CHANDRAN S7N, 27432

To The University of Kerala In partial fulfilment of the requirements for the award of the degree Of Bachelor of Technology in Mechanical Stream Industrial Engineering

DEPARTMENT OF MECHANICAL ENGINEERING COLLEGE OF ENGINEERING, THIRUVANANTHAPURAM – 16 October 2009

DEPARTMENT OF MECHANICAL ENGINEERING COLLEGE OF ENGINEERING THIRUVANANTHAPURAM – 16

CERTIFICATE This is to certify that the report entitled “Modern approach to Overall Equipment

Effectiveness (OEE)”, submitted by “Kailas Sree Chandran, S7N, 27432” to the University of Kerala in partial fulfilment of the requirements for the award of the Degree of Bachelor of Technology in Mechanical Stream Industrial Engineering, is a bonafide record of the seminar presented by him, under our guidance and supervision.

SRI. V. REGI KUMAR Senior Lecturer Dept. of Mechanical Engg; (GUIDE)

SRI. K. SABU Senior Lecturer Dept. of Mechanical Engg;

SRI. E. ABDUL RASHEED Professor Dept. of Mechanical Engg; (CO-ORDINATOR)

PROF. P. VINCENT HEAD OF THE DEPT OF MECHANICAL ENGINEERING COLLEGE OF ENGINEERING THIRUVANANTHAPURAM

ACKNOWLEDGEMENT It is with great pleasure, I place on record my deep sense of gratitude and indebtedness to my guide Sri. V. REGI KUMAR, Senior Lecturer, Department of Mechanical Engineering, College of Engineering, Thiruvananthapuram, for helping me to carryout this work successfully. I take this opportunity to express my most sincere thankfulness to Prof. E. ABDUL RASHEED, Senior Staff Advisor and Seminar Co-ordinator, Department of Mechanical Engineering, College of Engineering, Thiruvananthapuram, for his valuable directions. I am also thankful to Prof. P. VINCENT, Head of the Department of Mechanical Engineering, Sri. K. SABU, Senior Lecturer, Department of Mechanical Engineering, and Smt. MINI R.S., Lecturer and Staff Advisor, Department of Mechanical Engineering, College of Engineering, Thiruvananthapuram for their direct and indirect helps for the success of this seminar. Last but not least, I am grateful to my parents, friends and classmates for their help and co-operation for the successful presentation of this seminar.

KAILAS SREE CHANDRAN

ABSTRACT Under current economic conditions, severe global competition and postponement of new equipment purchases are causing business executives to be sensitive about all aspects of manufacturing operational costs. In this context Overall Equipment Effectiveness (OEE) has become a hot topic among many manufacturers. It provides a simple way to “keep score” of manufacturing performance, and lean manufacturing initiatives. Overall Equipment Effectiveness (OEE) is a hierarchy of metrics which focus on how effectively manufacturing equipment is utilised. The results are stated in a generic form which allows comparison against benchmark defined for the industry. Comparisons can also be made in between shifts, products, machines, departments, lines and plants etc. In simple words, “Overall Equipment Effectiveness shows the effectiveness of a machine compared to the ideal machine as a percentage.” OEE breaks the performance of a manufacturing unit into three separate but measurable components; Availability, Performance and Quality. Each component points to an aspect of the process that can be targeted for improvement. OEE may be applied to any equipment. This tool also allows for drilling down for very specific analysis, such as a particular part number, shift, or any of several other parameters. It is unlikely that any manufacturing process can run at 100% OEE. Many manufacturers benchmark their industry to set a challenging target, 85% is not uncommon.

CONTENTS 1. Introduction

1

2. Definition of Overall Equipment Effectiveness

2

3. Six Big Losses

3

4. Components of Plant Operating Time

8

5. OEE Factors

10

6. World Class OEE

15

7. OEE Calculation Methods

16

8. Sample Problem

20

9. Objectives of OEE

23

10. Cautions for using OEE

24

11. Modified Overall Equipment Effectiveness

25

12. Sample Problem using Modified OEE

29

13. Conclusion

30

14. References

31

1.

INTRODUCTION

There are many different approaches for measuring manufacturing efficiency and generally most companies will have some measures already in place. Many now argue that none of these are as comprehensive or far reaching as the Overall Equipment Effectiveness (OEE) score which should be considered as a fundamental key performance indicator. OEE was first used by Seiichi Nakajima, the founder of Total Productive Maintenance (TPM), in describing a fundamental measure for tracking production performance. He challenged the complacement view of effectiveness by focusing not simply on keeping equipment running smoothly, but on creating a sense of joint responsibility between operators and maintenance workers to external and optimize Overall Equipment Performance. OEE embodied in the first of the original pillars of TPM, guided all TPM activities and measured the results of these loss-focused activities. The use of OEE evolved into the current focused improvement pillar, one of eight TPM pillars.

1

2.

DEFINITION OF OVERALL EQUIPMENT EFFECTIVENESS

Overall equipment effectiveness is a measure of total performance- the degree to which the asset is doing what it is supposed to do [1]. The effectiveness of equipment is the actual output over the reference output [4]. Equipment Effectiveness shows how effectively the equipment is utilized. The value of the OEE is a measure for the effectiveness of the equipment in the available time for production. Overall Equipment Effectiveness shows the effectiveness of a machine compared to the ideal machine as a percentage. Ideal machine means the machine that produce maximum output at best quality. It doesn‟t have any loss or breakdowns. So it is only an imaginary machine. OEE compares the equipment with the same ideal equipment gives a numerical value as a percentage. The OEE is quantified as OEE = FULLY PRODUCTIVE TIME PLANNED PRODUCTIVE TIME

(1)

Planned Productive time is the time in which normally production is planned or realized. Fully productive time is the time which remains after subtracting all losses in a production system. Therefore OEE is the ratio between Fully Productive Time and Planned Production Time.

2

3.

SIX BIG LOSSES

One of the major goals of TPM and OEE programs is to reduce and/or eliminate what are called the SIX BIG LOSSES- the most common causes of efficiency loss in manufacturing. This was put forwarded by Nakajima in 1989. There are 3 OEE loss categories; Down Time Loss, Speed Loss and Quality Loss. Each of these categories have been divided into two. These are called Six Big Losses. OEE is generally measured in terms of these six losses. They are i.

Breakdown Losses

ii.

Setup and Adjustments Losses

iii.

Small Stop Losses (Idling and Minor Stop Losses)

iv.

Reduced speed Losses

v.

Startup Rejects (Reduced Yield Losses)

vi.

Production Rejects (quality defects and Reworks)

3.1 Down Time Losses For a longer period, if the output is zero, the installation produces nothing. The unused segments of time, during the examined period are down time losses. Down Time Losses are divided into two; Breakdown losses and Setup & Adjustments losses. 3.1.1 Breakdown Losses Breakdown Losses are by far the biggest of the “Six Big Losses”. The breakdown is often referred to as sudden, dramatic failure in which the equipment stops completely [1]. Such unexpected breakdowns are clearly losses, because production is stopped. Even if the cause lies in a single specific function, the break down results in cessation of all equipment

3

functions. Problems and losses related to deterioration are also considered as break down losses. Eliminating unplanned Down Time is critical to improving OEE. Other OEE factors cannot be addressed if the process is down. It is not only important to know how much Down Time your process is experiencing but also to be able to attribute the lost time to the specific source or reason for the loss. 3.1.2 Setup and Adjustment Losses Setup and Adjustment occurs when the production of one product ends and the equipment is adjusted to meet the requirements of another product. The loss of time during this delay is known as Setup & Adjustments. Setup and Adjustments time is generally measured as the time between the last good part produced before setup to the first consistent good parts produced after setup. This often includes substantial adjustments and/or warm-up time in order to consistently produce parts that meet quality standards. Usually the loss of time should be less than 10 minutes. 3.2 Speed Losses The output is smaller than the output at reference speed, these are called speed losses. When considering speed losses, one does not check if the output conforms to quality specifications. Speed Losses are divided into two; Small stops and Reduced speed. 3.2.1 Small Stops Losses Small stops losses occur when equipment stops for a short time as the result of a temporary problem. For example, a minor stoppage occurs when a work-piece is jammed in a chuck or when a sensor activates and shuts down the machines. As soon as someone removes the jammed work-piece or resets the sensor, it operates normally again. These losses also include 4

idling losses that occur when equipment idles. i.e. that it continues to run without producing. Since idling and minor stoppages interrupt functions, they can also be categorized as breakdowns. Even so, the two are essentially different in that a minor stoppage and the duration are usually less than 10 minutes. 3.2.2 Reduced Speed Losses Reduced speed refers to the difference between designed speed and actual operating speed [3]. Equipment may be run at less than designed speed for various reasons: non-standard or difficult raw materials, mechanical problems, history of past problems, or fear of overloading the equipment. This loss of speed is converted into time during OEE calculation. 3.3 Quality Loss The produced output either does or does not conform to quality specifications. If it does not comply, this is considered a quality loss. Quality loss is divided into two; Startup Rejects and Production Rejects. 3.3.1 Startup Rejects Some equipment requires warm-up time and certain adjustments to obtain optimum output. Startup losses are yield losses that occur in the early stages of production, from machine setup to stabilization of product quality. The volume of losses varies with degree of stability of processing condition, maintenance level on equipment, operator‟s technical skill, etc. 3.3.2 Production Rejects Production Rejects are quality losses that are not attributed to startup. These losses occur when products produced are not conforming to the specifications. Parts that require rework of any kind should be considered rejects. These losses occur during steady-state production.

5

Six big losses with three categories are shown in Figure 1. Six big losses are categorized with examples in Table 1.

Figure 1. Classification of Six Big Losses.

6

Table 1. Categories of SIX BIG LOSSES with examples. OEE Loss Category

Six Big Loss Category

Event Examples

DOWNTIME LOSS

Tooling Failures Break Downs

Unplanned Maintenance General Breakdowns Equipment Failure Setup/ Changeover Material Shortages

Setup and Adjustments

Operator Shortages Major Adjustments Warm-Up Time Obstructed Product Flow Component Jams

SPEED LOSS

Small Stops

Miss-feeds Sensor Blocked Delivery Blocked Cleaning/Checking Rough Running Under Nameplate Capacity

Reduced Speed

Under Design Capacity Equipment Wear Operator Inefficiency Scrap Rework

QUALITY LOSS

Startup Rejects

In-Process Damage In-Process Expiration In-correct Assembly Scrap Rework

Production Rejects

In-Process Damage In-Process Expiration In-correct Assembly

7

4.

COMPONENTS OF PLANT OPERATING TIME

OEE analysis starts with Plant Operating Time. It is the amount of time the facility is open and available for equipment operation. It is the maximum amount of time and is a constant. A day always consists of 24 hours of 60 minutes. A week always consists of 7 days of 24 hours. A year always consists of 52 weeks. It is also called Theoretical Production Time. This Plant Operating Time consists fully productive time and different losses like speed and quality loss. 4.1 Planned Production Time When a category of time called Planned Shut Down is subtracted from Plant Operating Time, the remaining is Planned Production Time. The planned shut down includes all events that should be excluded from efficiency analysis because there was no intension of running production [3]. E.g. Breaks. Lunch breaks, scheduled maintenance or periods where there is nothing to produce. Planned Production Time is also known as Available Production Time. OEE begins with Planned Production Time and scrutinizes efficiency and productivity losses that occur, with the goal of reducing or eliminating these losses. OEE starts with Plant Operating Time and end up at Fully Productive Time, showing the sources of Productive loss that occur in-between. 4.2 Operating Time From Planned Production Time, Down Time loss is subtracted to get Operating Time. Downtime losses includes any events that stop planned production for an appreciable length of time (usually several minute-long enough to log as a traceable event). Examples include equipment failures, material shortages, and changeover time. Change over time is included in OEE analysis, since it is a form of downtime. While it may not be possible to eliminate

8

changeover time, in most cases it can be reduced. The remaining available time is called operating time. It is also known as Gross Operating Time. 4.3 Net Operating Time From Operating Time, speed loss is subtracted which includes any factors that causes the process to operate at less than the maximum possible speed while running. Examples include machine wear, substandard materials, miss-feeds, and operator inefficiency. The remaining available time is called Net Operating Time. 4.4 Fully Productive Time From Net Operating Time, Quality Loss is subtracted which accounts for produced pieces that do not meet quality standards, including pieces that require rework. The remaining time is called Fully Productive Time. The goal is to maximize Fully Productive Time. It is also known as Valuable Operating Time. Plant operating Time= Fully Productive Time + Quality Loss + Speed Loss + Down Time Loss + Planned Shutdown. A graphic representation of components of Plant Operating Time is shown in Figure 2.

PLANT OPERATING TIME PLANNED SHUTDOWN

PLANNED PRODUCTION TIME DOWN TIME LOSS

OPERATING TIME NET OPERATING TIME FULLY PRODUCTIVE TIME

SPEED LOSS

QUALITY LOSS

Figure 2. Components of Plant Operating Time.

9

5.

OEE FACTORS

The OEE calculation is based on the three OEE factors; Availability, Performance and Quality. They are also called Effectiveness Factors. 5.1 Availability The availability portion of the OEE Metric represents the percentage of scheduled time that the equipment is available to operate[1]. The Availability Metric is a pure measurement of Uptime that is designed to exclude the effects of quality, Performance, and scheduled Downtime Events. It is calculated by

Availability =

Operating Time Planned Production Time

(2)

When downtime losses are zero, the availability is 1or 100%, the gross operating time equals the available time for production. i.e. Operating time equals Planned Production time. 100% availability means the process has been running without any recorded stops. 5.2 Performance Performance takes into account Speed loss. Performance is the ratio between Net Operating Time and Operating Time.

Performance =

Net Operating Time Operating Time

(3)

The performance portion of the OEE Metric represents the speed at which the equipment runs as a percentage of its designed speed. The Performance metric is a pure measurement of speed that is designed to exclude the effects of Quality and Availability [1]. 10

Performance does not penalize for rejects, which means even if the work is rejected or it‟s a rework, it will be included in the planned and actual hours accordingly. It is calculated as: Performance =

Ideal Cycle Time (Operating Time / Total Pieces)

(4)

Ideal Cycle Time is the minimum cycle time that your process can be expected to achieve in optimal circumstances. It is sometimes called Design Cycle Time, Theoretical Cycle Time or Nameplate Capacity. Since Run Rate is the reciprocal of Cycle Time, Performance can also be calculated as: Performance = (Total Pieces / Operating Time) Ideal Run Rate

(5)

Performance is capped at 100%, to ensure that if an error is made in specifying the Ideal Cycle Time or Ideal Run Rate, the effect on OEE will be limited. 100% Performance means the process has been consistently running at its theoretical maximum speed. 5.3 Quality The Quality portion of the OEE metric represents the Good Units produced as a percentage of the total units produced [1]. The Quality metric is a pure measurement of process yield that is designed to exclude the effects of Availability and Performance. Quality is the ratio of Fully Productive Time to Net Operating Time. Quality =

Fully Productive Time Net Operating Time

11

(6)

It is calculated as Quality =

Good Pieces Total Pieces

(7)

100% Quality means there have no reject or rework pieces. The three effectiveness factors offer a second way to quantity the OEE; OEE = Availability x Performance x Quality

(8)

Therefore OEE is the product of its effectiveness factors; Availability, Performance and Quality. The individual value of the three effectiveness factors lies between 0 and 1. The study of each of these effectiveness factors will improve the Overall Equipment Effectiveness. During analysis, the analyst can concentrate each category of losses separately. As shown in Figure 2, Availability takes into account Downtime losses, Performance takes into account speed losses and quality factor takes into account Quality loss. The main aim of OEE measurement is to reduce these losses and by analysis and improving the factors, the losses can be reduced or eliminated and OEE can be improvement. The use of effectiveness factors helps with prioritizing the size, but does not indicate the financial consequences that can differ per factor. Overall Equipment Effectiveness calculation and Losses are shown in Figure3.

12

Figure 2. OEE Factors and its losses.

13

EFFECTIVENESS LOSS

EQUIPMENT

OEE FACTORS

PLANNED OPERATING TIME

DOWN TIME LOSS

BREAK DOWN OPERATING TIME

AVAILABILITY SETUP & ADJUSTMENT

NET OPERATING TIME

SPEED LOSS

SMALL STOPS PERFORMANCE REDUCED SPEED

FULLY PRODUCTIVE TIME

QUALITY LOSS

STARTUP REJECTS QUALITY PRODUCTION REJECTS

Figure 3. Overall Equipment Effectiveness calculation and losses [1]. 14

OVERALL EQUIPMENT EFFECTIVENESS

6.

WORLD CLASS OEE

World class OEE is a standard which is used to compare the OEE of the firm. The percentage of World Class OEE is given in Table 2. Table 2. World Class OEE levels OEE Factors

WORLD CLASS

Availability

90%

Performance

95%

Quality

99%

OEE

85%

These values of OEE factors are generally accepted but the values are different for different industries. For Manufacturing, the value of World Class OEE is 85% but for Paper Industry and Cement Industry, the value is 95% and 80% respectively. The aim of the firm is to achieve this value of OEE by continuous improvement.

15

7.

OEE CALCULATION METHODS

OEE is a percentage of an equipment which shows its efficiency or effectiveness. Different input data is needed for calculating OEE. The aim of OEE measurement and analysis is to reduce the equipment losses to zero and has been recognized as a necessity for many organizations [3]. There are mainly 3 methods for finding OEE. 7.1 Direct Method 7.2 OEE Factors Method 7.3 Software Method For all these methods, the input data is same. The difference is the approach to the problem. basically Software Method also uses OEE Factors Method. 7.1 Direct Method Direct Method uses the basic formula for finding OEE. OEE =

Fully Productive Time Planned Production Time

(9)

It involves finding the Planned Production Time and Fully Productive Time from the given input data. Planned Production Time can be found out by subtracting Planned Shutdown from Plant Operating Time. Plant Operating Time: Calendar time 24 hours/day, 7 days/week, 365 days/year, 60 minutes/hour, 60 seconds/minute. Planned Shutdown includes lunch breaks and tea breaks, shift change, planned maintenance etc. Fully Production time can be found out by subtracting Downtime loss, Speed loss and Quality loss from Planned Production time. Downtime loss should be given in the input data. Speed loss 16

can be calculated from ideal production rate and actual production rate. Quality loss can be calculated from no. of defective products. All of these are losses. This method is a little complex and is not used practically. The main disadvantage of this technique is that analysis from the results is very limited. Because the output is the OEE percentage alone. In other two techniques, the result has more information which aids in further analysis. 7.2 OEE Factors Method This method is used as a standard method for calculating Overall Equipment Effectiveness. It is simple and uses minimum input data. This method uses the three effectiveness factors to quantify the OEE. OEE = Availability x Performance x Quality

(10)

Therefore by using this method, three individual effectiveness values are calculated which can be used for further analysis. Overall Effectiveness is the product of these effectiveness factors. 7.3 Software Method This is an automated method. This involves the use of computers in calculating OEE. The basic approach is same as the OEE Factors Method but Software Method is more accurate and more flexible. All modern firms use this method. Software method can be done with the same input data which is required for other two techniques. There are two types of OEE Softwares: 7.3.1 Spreadsheets 7.3.2 System Softwares

17

7.3.1 Spreadsheets Spreadsheet makes calculating OEE easier but unfortunately, it won‟t help with collecting the data. Manual collection and processing of data for OEE calculation is time consuming and ensures that it is always out of date. 7.3.2 System Softwares System software collects data in real-time directly from the equipment. It saves the time needed to manually collect the data leaving staff available to do more productive work. The data is highly accurate compared to manually collected data and it is available immediately. The analyst can analyze OEE continuously and display it on the shop-floor so the staff can see exactly how they are performing. OEE IMPACT, VISUAL OEE, OEE TOOLKIT, PROVIDEAM are examples for System Software. These softwares not only calculate OEE, but also analyze and report on key production information; machine setup times, product analysis, product tracking, wastage, rework, maintenance times etc. They produce reports in the form of graphs, charts etc. some screenshots of System Softwares is given in Figure 4.

18

Figure 4. Screenshots of OEE System Softwares. 19

8.

SAMPLE PROBLEM

Some data about an equipment is given. Calculate Overall Equipment Effectiveness using all three methods. Shift Length = 8 hours Tea breaks = 10 minutes x 2 Meals break = 1 hour Downtime = 10% of shift (48 hours) Idle Run rate = 5 pieces/minute (Cycle time = 0.2min/pieces) Total pieces produced = 1600 Rejected pieces = 52 Assure the equipment works only under the supervision of its operator. 8.1 Direct Method According to Direct Method, OEE = Fully Productive Time / Planned Production Time Planned Production Time = Plant Operating Time – Planned Shutdown Plant Operating Time = 8 hours x 60 = 480 minutes. Planned Production Time = 480-80 = 400 minutes. Fully Productive Time = Planned Production Time – (Downtime+Speed+Quality losses) Downtime loss = 10% of shift length = 480 x 0.10 = 480 minutes Speed loss = (Ideal Production- Actual Production) x Cycle time Ideal Production = Ideal run rate x Operating Time Operating Time = Planned Production Time – Downtime loss = 400-48 = 352 minutes.

20

Ideal Production = (5 pieces/min) x 352 minutes = 1760 pieces. Speed loss = (1760 – 1600) x 0.2 minutes = 160 x 0.2 = 32 minutes Quality loss = No. of rejected items x Cycle time = 52 x 0.2 minutes = 10.4 minutes. Fully Productive Time = 400 – (48+32+10.4) = 309.6 minutes OEE = 309.6/400 = 0.774 Overall Equipment Effectiveness = 74.4% 8.2 OEE Factors Method According to this method, OEE = Availability x Performance x Quality Availability = Operating Time / Planned Production Time Operating Time = 352 (Calculated earlier) Planned Production Time = 400 (Calculated earlier) Availability = 352/400 = 0.88 Performance = (Total pieces / Operating Time ) / Ideal Run Rate =(1600/352)/5 = 0.9091 Quality = Good Pieces / Total Pieces = (1600-52) / 1600 = 0.9675 OEE = 0.88 x 0.9091 x 0.9675 = 0.774 Overall Equipment Effectiveness = 77.4% 8.3 Software Method A sample spreadsheet is used for calculating OEE. The input data is entered into the required fields of the worksheet. The spreadsheet calculates OEE factors simultaneously while entering data. The three factors Availability, Performance, Quality are calculated and OEE is also calculated. These values are also compared with World Class OEE so that the analyst can know the present condition of the equipment. The screen shot of the Excel Calculator is given in Figure 5. 21

Figure 5. Screenshot of Excel Calculator. 22

9.

OBJECTIVES OF OEE  OEE data (information) is used to identify and categorize major losses or reasons for poor performance.  OEE provides the basis for root cause analysis.  OEE percentage is used to track and trend the improvement, or decline, in equipment effectiveness over a period of time.  OEE percentage can point to hidden or un-trapped capacity in a manufacturing process and lead to balance flow.

23

10.

CAUTIONS FOR USING OEE i.

The calculated OEE is not included for use as a corporate or plant level measure. OEE percentage is a rough measure of selected equipment effectiveness only.

ii.

Calculated OEE is not valid for comparing or benchmarking different assets, equipment or processes. OEE is a relative indicator of a specific single asset effectiveness compared to itself over a period of time. However, OEE can be used to compare like equipment in like situations producing like products or output.

iii.

There appears to be no valid specifications of “World-Class OEE”. In manufacturing industry, 85% is World-class OEE at the same time, in process industry, it is 90%. In Total Productive Maintenance, 85% OEE is considered to be World Class Manufacturing.

iv.

OEE percentage calculations are not statistically valid. A calculated OEE percentage assumes that all equipment – related losses are equally important and that any improvement in OEE is a positive improvement for the business. This is generally not the case. For example, the calculation of OEE of same equipment at different intervals are given below. Availability rate

: 80%

Availability rate

: 95%

Performance rate

: 99%

Performance rate

: 98%

Quality rate

: 95%

Quality rate

: 89%

OEE = 80% x 99% x 95% = 75%

OEE = 95% x 98% x 89% = 83%

In the second case, OEE increased by 8% but at the same time the quality reduced by 6%. This will have a negative impact on the business.

24

11.

MODIFIED OVERALL EQUIPMENT EFFECTIVENESS

In the Six Big Losses, Setup & Adjustments and Small time losses, both will create a loss of less than 10 minutes. But both are given under different categories. So by combining these two losses into one category, Stop Time Losses can be defined. The advantage is that it will be more helpful during analysis to take initiative to reduce these small losses. So by modifying the Six Big Losses as shown in Figure 6, a new category called Stop Time Losses are created.

Figure 6. Modified classification of Six Big Losses. By removing this Stop Time Losses from operating time, a new category of time called Running Time is created. Based on this Running Time and Stop Time Losses, a new factor for OEE, ie Usability is derived. Components of Plant Operating Time including Running Time are shown in Figure 7. The inclusion of the Usability factor leads to more detailed categorization of equipment losses leading to specific identification of equipment losses in terms of Availability and Usability [1]. 25

As shown in figure 8, the Usability factor takes into account Stop Time Losses. Now the advantage is that, four factors are available for analysis. So a better analysis can be done compared to the former. But this Modified OEE is still in proposal stage. No firms have implemented this and no software is using this for standard calculations and analysis. The modified classification of Six Big Losses is shown in Figure 9.

PLANT OPERATING TIME PLANNED SHUTDOWN

PLANNED PRODUCTION TIME DOWN TIME LOSS

OPERATING TIME STOP TIME LOSS

RUNNING TIME NET OPERATING TIME FULLY PRODUCTIVE TIME

SPEED LOSS

QUALITY LOSS

Figure 7. Components of Plant Operating Time including Running Time.

Figure 8. Modified OEE factors and its losses.

26

11.1 Availability There is no difference in calculating Availability. The only difference is that when calculating Operating time, only breakdown losses are subtracted. Availability

=

Operating Time Planned Production Time

(11)

11.2 Usability Usability is calculated by dividing Running Time by Operating Time. Usability =

Running Time Operating Time

(12)

Running time is calculated by subtracting Setup & Adjustments and Small Stops losses from Operating time. 11.3 Performance Performance takes into account Reduced Speed losses only. It is the ratio between Net Operating Time and Running Time. Performance =

(Total Pieces / Operating Time) Idle Run Rate

(13)

11.4 Quality Quality is calculated by subtracting the output during Running time and rejects (including reworks) and then dividing it by the output. Quality =

(Output – Rejects) Outputs

(14)

Therefore Modified Overall Equipment Effectiveness is the product of 4 factors; Modified OEE = Availability x Usability x Performance x Quality

27

(15)

EQUIPMENT

EFFECTIVENESS LOSS

OEE FACTORS

BREAK DOWN

AVAILABILITY

OPERATING TIME

DOWN TIME LOSS

PLANNED OPERATING TIME

RUNNING TIME

STIOP TIME LOSS

SETUP & ADJUSTMENT

USABILITY MODIFIED OVERALL EQUIPMENT EFFECTIVENESS

NET OPERATING TIME

SPEED LOSS

SMALL STOPS

REDUCED SPEED

PERFORMANCE

FULLY PRODU CTIVE TIME

SPEED LOSS

STARTUP REJECTS QUALITY PRODUCTION REJECTS

Figure 9. Modified Overall Equipment Effectiveness calculation and losses [1]. 28

12.

SAMPLE PROBLEM USING MODIFIED OEE

Use the previous problem itself for calculating Modified OEE. The Downtime loss of 48 minutes is divided into 20minutes of warm-up time and 28 minutes of equipment breakdown (tooling failure). Rest is same. Availability = Operating Time / Planned Production Time Planned Production Time = 400minutes (Calculated earlier) Operating Time = Planned Production Time – Breakdown = 400 – 28 = 372 minutes. Availability = 372/400 = 0.93 Usability = Running Time / Operating Time Running Time = Operating Time – Warm-up Time = 372-20 = 352 minutes Usability = 352/372 = 0.9462 Performance = (Total Pieces / Operating Time ) / Ideal Run Rate = (1600/352) / 5 = 0.9091 Quality = Good Pieces / Total Pieces = (1600-52) / 1600 = 0.9675 Modified OEE = 0.93 x 0.9462 x 0.9091 x 0.9675 = 0.774 Modified Overall Equipment Effectiveness = 77.4%

29

13.

CONCLUSION

The definition and use of Overall Equipment Effectiveness over the years has been widely debated. Many practitioners have found that OEE has several uses and definitions which have led to considerable confusion when comparing machine-to-machine, plant-to-plant or companyto-company. Unfortunately, OEE was not designed to make comparisons from machine-tomachine, plant-to-plant, or company-to-company, but it has evolved to these common levels of misuse. OEE is not a statistically valid metric, but it has been used as such for years. OEE does not diagnose a specific reason why a machine is not running as efficiently as possible, but it helps to categorize the areas for initiating the equipment improvement. Modified Overall Equipment Effectiveness helps to analyze short time losses and long time losses separately. Also it adds one more factor in calculation, Usability. It helps in more specific analysis of losses and for initiatives to reduce these losses. But Modified OEE is still in development stage.

30

14.

REFERENCES

[1] Anil S. Badiger, „A proposal: evaluation of OEE and impact of six big losses‟, Int. J. Process Management and Benchmarking, Vol.2, No. 3, 2008, pp 234-248. [2] Ravikumar M. M., „Improving Equipment Effectiveness‟, Int. Business Management, Vol. 3, No.2, 2008, pp 91-96. [3] Francis Wauters, „White Paper on Improving Plant Performance: OEE‟, ABB Inc, June 2002. www.abb.com [4] „The Fast Guide to OEE‟, Vorne Industries, 2008. www.vorne.com [5] Robert M. Williamson, „Whitepaper on OEE Implementation‟, Strategic Work Systems Inc, 2004. www.swspitcrew.com [6] http://www.bestmanagementarticles.com [7] http://www.maintenanceworld.com [8] http://www.managementparadise.com [9] http://www.oee.com [10] http://www.oeetoolkit.com [11] http://www.pdfcoke.com

31