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OEE Explained!


All manufacturing sites have some form of measure to indicate how well they have performed based on requirements and target set. This could be against budget, customer requirements, productivity or capability of the equipment. There may be several measures used to indicate performance against the various metrics. The most widely used measure to determine performance against capability of the equipment is Overall Equipment Effectiveness which is often referred to as OEE.

The overall intent is to maximise the use of the equipment to produce what it is capable of within the specified timeframe. Ideally the equipment should run at its required rate and make good quality product for the duration. In practice, this is rarely the case and there would be occasions when downtime occurs or inferior quality products are made. Some of this is planned stoppages due to product changeovers or equipment maintenance where as in other cases the stoppages have not been predicted and so unplanned downtime occurs. This can be due to equipment breakdown, inferior raw materials, sub-optimal conditions, etc. To be able to maximise the utilisation of the equipment it is worthwhile knowing what is causing the loss between actual performance and the ideal state. This can help target improvement efforts to minimise or eliminate the losses to get as close to the ideal performance as possible.

The three main components of Overall Equipment Effectiveness (OEE) are Availability, Performance and Quality:

Availability is a measure of the time the equipment was actually available to run within the specified duration generally known as planned production time. The time it is not available is generally attributed to large duration of downtime such as product changeovers, breaks, breakdowns, etc.

Performance is a measure of how well the equipment performed when it was running. The loss of time in this category is mainly due to the equipment not running at its required rate and so producing products at a reduced rate.

Quality is a measure of time taken to produce good quality product. The loss in this category is due to time lost to make inferior quality product.

OEE as a percentage can be calculated by either dividing what was actually produced against what in theory should have been produced if the equipment ran in its ideal state or by multiplying the Availability, Performance and Quality measures.

OEE Calculation

OEE Category


Operating time / Planned production time
Net operating time / Operating time
Fully productive time/ Net operating time


OEE = Availability X Performance X Quality


Six Big Losses of OEE

To be able to better determine what is contributing to the greatest loss and so what areas should be targeted to improve the performance, these categories have been subdivided further into what is known as the ‘Six Big Loses’ to OEE. These are categorised as follows:


Performance Quality
Planned Downtime Minor Stops Production Rejects
Breakdowns Speed Loss Rejects on Start up


The ‘OFX Productivity Model’ below summarises how all the various metrics fit together.



The Six Losses calculation

Six loss category Calculation
PDT or external unplanned event Planned downtime / Total production time
Breakdowns (>5mins) Major fault time / Total production time
Minor stops (<5mins) Minor fault time / Total production time
Speed loss (Output / Ave speed x Total production time) – (Output / Rated speed x Total production time)
Production rejects Rejects in prod / (Good output + Total rejects)
Rejects on start up Rejects on start up / (Good output + Total rejects)


The Six Losses Countermeasures

The reason for identifying the losses in these categories is so that specific countermeasures can be applied to reduce the loss and improve the overall OEE. The table below explains how the loses can be categorised and addressed using the relevant countermeasures:



OEE and Six Loss Calculation Example



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