Compare OEE when defined according the OEE Industry Standard

Q: I defined OEE according to the OEE Industry Standard. Can we now benchmark our machines?

Arno Koch •    This question is popping up over and over again. Obviously the thinking is: When we standardize the definition of the metric we can use it to compare equipment and even factories.

Compare two shifts with 56% OEE…

Imagine the early shift of machine X has an OEE of  56%.
The late shift on this machine also has an OEE of 56%.

How do those two shifts on the same machine compare? Are they equal?
The early shift was running an availability of 75%, Performance of 85% and quality of 95%.
The late shift was running an availability of  85%, Performance of 95% and quality of 75%.

The same OEE but on top of the equal amount of good product, the late shift produced a huge volume of scrap. Same OEE, different cost-price.

Higher OEE having a negative effect…

There are many situations where a higher OEE has even a negative effect:

  • The OEE was higher, but the process became instable, less reliable
  • The OEE was higher, yet there was no demand and stock increases
  • The OEE was higher because the crew was pushed over the limits causing stress, illness, risk of accidents etc.
  • The OEE was higher, yet the cost also where higher due to additional resources applied.

Conclusion: Even on ONE machine with an identical definition of OEE it is not possible to compare two OEE numbers without knowing the parameters behind the number.

And even when knowing those parameters it is still difficult. Was the shift running many small batches or one continuous batch? What products are allocated to what machine and shift?  Just to name some reasons for fluctuations.

The question now is: Why does everybody want to compare machines and factories? How will that lead to improvement? Remember what Dr Demings answer was?

This standard aims to offer a methodology that breaks through this ‘comparison’ thinking by comparing each machine against its own theoretical maximum, allowing the crew to identify where it is losing capacity and the management to support any initiative and activity to improve this.

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