OEE
Overall Equipment Effectiveness broken into its three parts — availability, performance, and quality — from planned time, downtime, cycle time, and piece counts. World-class is about 85%; most lines are lower than they think.
Overall equipment effectiveness · availability × performance × quality
OEE = Availability × Performance × Quality
What this gives you
Overall Equipment Effectiveness rolls three separate losses into one number, and then — more usefully — breaks it back apart so you can see which loss is hurting you. It is the product of three factors, each a fraction between 0 and 1: OEE = Availability × Performance × Quality. Availability is the share of planned time the line was actually running; Performance is how close it ran to its ideal cycle time; Quality is the share of parts that came out good. Multiply the three and you get the fraction of planned time that produced good parts at full speed.
The three factors, one at a time
Availability = run time ÷ planned time, where run time is planned time minus all downtime (breakdowns, changeovers, waiting on material). Performance = (ideal cycle time × total pieces) ÷ run time — it compares the time the parts should have taken at nameplate speed against the time you actually had the machine running, so slow cycles and small stops pull it down. You can enter that nameplate speed either way: as an ideal cycle time in seconds per piece, or as an ideal rate in pieces per hour. The two are reciprocals — 1.0 s/pc is the same as 3,600 pc/hr — and give an identical Performance figure; pick whichever your line data already speaks in. Quality = good pieces ÷ total pieces, counting scrap and rework as loss. A line can post 95 percent on any single factor and still land in the 70s on OEE, because the three multiply rather than average.
Field note — define “planned time” before you argue about the number
Most OEE fights are really definition fights. If one shift counts lunch and scheduled breaks as planned production time and the next shift subtracts them, their availability numbers are not comparable and neither is their OEE. Pick one convention — typically planned time excludes breaks and scheduled no-run periods but includes every unplanned stop — and hold everyone to it. Likewise, ideal cycle time must be the true nameplate best, not last month’s average; if you feed in a soft cycle time, Performance will read near 100 percent and hide the very losses you are chasing.
Worked example
A line has 480 minutes planned, 60 minutes of downtime, a 1.0 second ideal cycle, and it made 22,000 pieces of which 21,500 were good. Run time is 480 − 60 = 420 minutes. Availability is 420 ÷ 480 = 87.5 percent. Performance is (1.0 × 22,000) ÷ (420 × 60) = 87.3 percent. Quality is 21,500 ÷ 22,000 = 97.7 percent. Multiply the three: 0.875 × 0.873 × 0.977 = about 74.6 percent OEE. World-class is often quoted near 85 percent, so this line has the most to gain from its availability and performance losses, not its scrap.
TEEP — when the line only runs part of the day
OEE measures losses inside planned production time. TEEP (Total Effective Equipment Performance) widens the lens to the whole calendar. Utilization is the share of calendar or scheduled time you actually planned to run — Utilization = planned time ÷ calendar time — and TEEP = OEE × Utilization. Take the line above and set it in a 24-hour day: calendar time is 1,440 minutes, so utilization is 480 ÷ 1,440 = 33.3 percent and the 74.6 percent OEE becomes just 24.9 percent TEEP. That gap is idle capacity you could unlock with more shifts before you ever buy another machine — which is exactly the conversation TEEP is meant to start. The bar chart also carries the world-class targets for each factor: availability 90 percent, performance 95 percent, quality 99.9 percent, and 85 percent OEE.