OEE is a great metric for a process in which equipment is the constraint.

OEE as a measure focuses on the performance of the equipment. Typically all the six big losses of OEE are based on the loss due to the equipment not running well.

To understand if OEE is the right measure for you – You need to ask yourself – What is the constraint in your manufacturing process?

That means how do you increase output – is it by hiring more people, buying in different raw materials, reducing changeovers, reducing machine breakdowns, running the machines longer, etc? If you are not sure, ask your manufacturing personnel – What do we need to change to make more volume of product?

If the level of output is people related whereby if there are more people the output increases, the best primary metric to use in this case is a productivity measure; such as Man hours/no of products type measure with OEE as a secondary measure on specific machines where appropriate.

It’s not that OEE is not beneficial as a measure, it’s just that make sure that your primary measure enables you to optimise your type of bottleneck. As an example; there was a packing company with very old machines and they had 200% + capacity and were measuring OEE. By focusing on OEE they were running some of their machines as hard as possible whilst the others were stopped. Due to the age of the machines, they kept on breaking down and it meant that huge amounts of maintenance was needed to keep the machines running. By moving to a productivity measure as a primary measure, the machines ran at around 40% OEE with the same number of staff; however the overall cost per part went down as it did not require a large amount of money to maintain the machines.

Pick the correct key measure that enables you to measures your constraint and helps you to improve. Use OEE as the primary measure only when equipment is your constraint!