OEE calculations – the perils of cooking them

OEE calculations: Absolute vs. incremental target

OEE calculations can be easily cooked up. You have deployed a machine monitoring system to go down the Industry 4.0 path. The system is working, you are getting data, and now you want to start using the OEE numbers to improve productivity. You have two options:
1. Set an absolute target OEE number, and work towards achieving this number.
2. Set an incremental target for OEE improvement, and work towards achieving this.

OEE calculation can be cooked up with convenient formulae
OEE calculation can be cooked up with convenient formulae

What happens in option 1

  • You set a target like 70 %.
  • People down the line in your organization cook up convenient OEE formulae. Example: They consider most downtimes as part of the process and not as downtimes – like setup time, inspection, part load/unload, insert change, etc.
  • Everyone focuses on achieving the target OEE number by fair or foul means (usually foul, because fair is difficult).
  • Once this number is achieved, everyone sits back and relaxes, thinking they’ve done their job and that there is no more scope for improvement.

What happens in option 2

  • You set a target for improvement, say 1 % per month.
  • It does not matter what the starting number is with the formula used. The starting number could be 70 % (when in reality it is 45 %), but nobody is looking at this at all. What everyone is focused on is the target 1 % increment.
  • People can cook up whatever OEE formulae they want. An absolute value can be inflated by a convenient OEE formula, but a monthly increment cannot be cooked up, because the same formula is used every month.
  • There is no end OEE number that people can achieve and then go to sleep. The incremental number is forever.

Option 2 is obviously the better option.

Don’t be obsessed with the absolute value of your OEE. This leads to people at various levels cooking up OEE calculations to show good values. Instead, use it as a measure of productivity that needs to be improved. Set a target for periodic improvement, not an absolute value.

LEANworx Cloud is an Industry 4.0 based machine monitoring system that enables enables you to track and improve OEE and other productivity parameters. Want to know more about how LEANworx machine monitoring system can help you implement Industry 4.0 and smart manufacturing rapidly and economically ? Click here.


A grave matter

A while ago I was in Aurangabad, the city named after Aurangazeb (1618-1707). Aurangazeb was quite a monster – had two of his brothers executed, and imprisoned his father Shah Jahan in Agra Fort till his death. After executing his eldest brother Dara Shikoh, he actually took Dara’s head to show his father (“Dad, Dara wanted to meet you one final time, so I got him to see you, heh, heh.”). The Taj Mahal is his mother Mumtaz Mahal’s tomb. His great-grandfather was Akbar.

I saw Aurangazeb’s tomb in Khuldabad, near Aurangabad. A remarkably simple structure compared to his wife’s and mother’s tombs. In the final years of his life, he knitted caps and sold them anonymously in the market. He specified that his grave must be simple, funded solely from money he made from selling the caps. Quite a contrast to his younger years spent bumping off various friends and relatives in pursuit of power and wealth.

The tomb of his wife Dilras Banu in Aurangabad, in contrast, is a large monument that is a copy of the Taj Mahal. It is called Bibi ka Maqbara, which means ‘Tomb of the Lady’ in Urdu. Its architect was the son of the architect of the Taj Mahal (small world, huh ?). The grave has a lot of notes and coins thrown in by visitors, a sign of their reverence for her.

It was initially designed to rival the Taj Mahal, but finally turned out to be an emaciated version of the original (actually looks like a Taj Mahal that went on a juice-only crash diet for 6 months – see the comparison picture below). It was commissioned by Aurangazeb’s son, and the down scaling was caused by Aurangazeb cutting the budget (“Son, I think I’ve spent enough on your mom. I’ve moved on to another, hotter babe, and wooing her is costing me a bomb – restaurant bills and stuff, you know?”).

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

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