OEE, which is determined as the product of availability, performance rate, and quality rate, is a tool used to assess the real performance of a process.
Availability is the tool used to measure process performance by considering operating hours out of total available hours.
Performance Rate is the tool used to measure actual throughput against designed throughput.
Quality Rate is the tool that measures efficiency of products produced by considering good product output out of total product output.
Generally, benchmark of OEE for manufacturing sector is taken as 85% and all manufacturers try to achieve the best in class results
OEE calculations for a manufacturing process that yields finished goods at the needed throughput using the correct calculation methodology has been shown in table below.
The following 5 scenarios show how quality is frequently measured inaccurately in order to unnaturally increase OEE for the process:
Scenario 1: Including reworked items in good products – In a few manufacturing processes, some of the rejected products are reworked to get a good product, and calculated those reworked items in good products.
Scenario 2: Finalize rejection % after audits that take a more time but consider rejection % into account beforehand.
Scenario 3: Reducing the customer specification limits to increase good product volume – Sometimes, process shift managers slightly reduce specification limit to get less rejection % compared to other shifts
Scenario 4: Considering rejection count only during stable production not during start ups – During production start-ups, rejection % is high as compared during stable production and so managers consider only rejection% while stable production
Scenario 5: Considering rejection % for the best production shift instead of monthly average or for the best operator instead of all operators