Formula of OEE

What is the formula of OEE calculation ?

OEE, or Overall Equipment Effectiveness, is a brilliant invention that, in a single number, tells you how much waste there is on your shop floor. It is the ratio of what you produced to what you could have produced – the actual output to the theoretical possible output. It tells you how efficiently you are using your equipment and your investment. There is a simple formula of OEE.

What is OEE. OEE calculation formula.

OEE = Availability x Performance x Quality

The components A, P and Q in the formula of OEE can be summed up representing:
1. How much time did the machine run ?
2. How efficiently did it run while it was running ?
3. How many good parts did it produce while it was running ?

Availability: Is the machine operating or not? The ratio of the time that the machine was running, to the time that it could have actually run. The difference is because of idle time caused by breakdowns, setup, shift-change, etc.

Performance: How fast is the machine running? The ratio of the number of parts produced to the number of parts that theoretically could have been produced in the time that the machine was running. The difference could be because of inspection, insert changes, tool breakage, etc. between the start and end of a cycle. On a CNC machine, the difference could be due to using the feed rate or spindle speed override.

Quality: How many good parts were made? The ratio of the number of parts that pass quality inspection to the total number of parts made. The difference is the number of parts rejected. OEE allows you to measure and reduce waste (of available time, machine capacity, raw material) on the shop floor. It is a single number that you can communicate to, and is understood by, everybody from the machine operator to the President. It can be tracked month-on-month, improved upon.

Type of lossMeaningExamples
Not scheduled for productionTime when the machine is not planned to runNon-working shifts, holidays, lunch breaks, tea breaks
Failure, Idle timeTime when the machine is planned to run, but is not running. This includes all events that stop production long enough where it makes sense to track a reason for the downtime (typically several minutes).Setup, machine breakdown, inspection, accident, no raw material, power shutdown, part unloading and loading.
Minor stops, Speed lossMachine running at lower than normal production rate, and downtimes of duration so small that it does not make sense to track the reason for the downtime.Part unload/load time that is longer than the standard unload/load time, cycle times that are longer than the standard cycle time, rework.
ScrapNumber of rejected parts.Rejection quantity

A = 100 x (Running time / Available time)

P = 100 x (Real production / Theoretical production)

If you are running a single part,
P = No of parts produced / No. of parts that could have been produced
P = (No. of parts produced x Std. cycle time of part) / Running time

If you are running multiple parts,
P = Σ(No. of parts produced x Std. cycle time of part) / Running time

Q = 100 x (No. of OK parts produced / Total parts produced)

OEE: A x P x Q

A shop works 24 hours in 3 shifts of 8 hours each.
There is a break of 30 minutes in each shift (total 1.5 hrs. in a day).

The std. cycle time of the part being produced is 29 minutes. The std. load-unload time is 1 minute – time to unload a finished part and load the next part. Each part therefore takes 30 minutes.
There is a downtime of 4 hours. The downtime is due to a machine breakdown, waiting for raw material and a power shutdown.
35 pieces are made.
1 piece is rejected.

Available time = 22.5 hrs. (24 – 1.5 hrs. breaks)
Running time = 18.5 hrs. (22.5 – 4 hrs downtime)
Availability = 100 x (18.5 / 22.5) = 82.2 %

Theoretical production = 37 pieces (18.5 / 0.5). Running time is 18.5 hrs, and each part takes 30 minutes.
Real production = 35
Performance = 100 x (35 / 37) = 94.6 %

Real production = 35 pieces
Good products = 34 (35 – 1 rejection)
Quality = 34 / 35 = 97.1 %

OEE = 100 x (.822 x .946 x .971) = 75.4 %.


Biryani and Pulao – what’s the difference ?

The word Biryani is derived from the Persian word ‘Birian’. In Persian, Birian means ‘Fried before Cooking’. Meat (or vegetables) is fried in ghee and half-cooked. Separately, rice is fried in Ghee and half-cooked. The rice and meat are layered in a vessel called a Handi. You can see the layers in the vessel, and the different layers are visible and have a different taste when served.

Biryani – in the Handi and on the plate

Pulao is from the Persian word Pilaf. Rice is browned in oil, and separately, meat (or veg) is fried in Ghee and cooked with aromatic spices in water. The rice and this broth are mixed together and cooked. The pulao is a homogenous mixture when cooking, and looks and tastes homogeous when served.

Pulao – vegetarian and meat-based

The difference between biryani and pulao is in the LAYERS. Biryani has layers, while pulao does not. So Biryani is multi-dimensional and more interesting as you eat it.

I first learnt this about this difference about 10 years ago, in a restaurant in Bangalore called Biryani Merchant (no longer in existence, sadly). They served 3 different types of biryani on any given day (out of the 10-odd types in India). India has a large variety of Biryanis: Lucknow, Hyderabadi, Kashmiri, Ambur, Kolkata, Bohri, Calicut, Tahiri (this is a vegetarian biryani). There was a leaflet on each table educating you about biryani. The menu was fixed, and you paid a fixed amount, ate as much as you could.

Way back then, as a young lad of 45 I could put away vast quantities of food. Owners of ‘eat-all-you-can’ establishments used to shiver as I walked in, thinking of the damage I was about to do to their balance sheet.

About his blog from LEANworx: Plug-and-play Industry 4.0 system for MSMEs.

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