Efficiency – Effectiveness – Productivity

What is the relationship between efficiency, effectiveness and productivity?

What is the path that can be followed to bring  ‘improvement’

What are the definitions within OEE?

Effectiveness KPI’s

Overview

Several parties, such as production teams, line managers and top management may have a different scope when looking at ‘effectiveness’.
Being aware of those differences, it is possible to calculate different indices representing those different scopes; all based upon the same data. In the literature we find several attempts to do so, unfortunately they are not always consistent.

Different calculations of Availability

The main difference in the calculation of the effectiveness KPIs is in the way ‘Availability’ is being approached. The overview below will be discussed in detail per KPI.

OEE is the default scope for a production team. It shows the ratio between the theoretical maximum good output during the loading time vs. the actual good output. The loading time (the available time for the production team) can be less than the operations time since the equipment can be unscheduled during the scheduled time, thus reducing the loading time. Loading time therefore is the time the equipment potentially could have been running.

Caution: Setups, Breaks, Maintenance are all potential losses to be reduced; the machine is waiting for something thus this time is WAITING time and nót unscheduled. The main reason to un-schedule a machine is a lack of demand.

In cases where multiple different products have been produced, (either sequential or parallel) the Performance part of the OEE is calculated as a weighted average between the several expected output ranges.

Definition of ‘Availability’ in OEE

In the definition of OEE, the ‘availability rate’ indicates the relationship between the time that the machine could theoretically have been in operation (there was ‘demand’) and the time that there was actual output.

OEE Top is equal to OEE, except for the way the performance rate is calculated.

In OEE Top the performance rate is calculated based upon the Name Plate Capacity of the equipment; thus ignoring restraints due to the product-machine combination. It is used to detect effectiveness losses due to the allocation of products; the chosen product mix.

OEE Top is used in systems where the physical maximum of the equipment and the physical maximum of certain products are far apart. If for example an extruder has enough heating and extrusion power to produce a 125mm PVC pipe and you would now produce a 15mm pipe, then its maximum speed in kg of product would be significantly lower than for this 15 mm pipe, although it is physically driven to its limit.

In other words: it would be better to produce this smaller pipe on a smaller extruder. So if the OEE is significantly higher than the OEE Top, then could ask yourselves whether you may have used an oversized system for the current product mix.

OEE Solitaire is applicable in situations where the monitored equipment has a (technical) link to other equipment/processes. Thus the equipment is an integrated part of a line.
The effectiveness of such equipment is partially depending on factors like line balance and effectiveness of other equipment.
OEE Solitair is is meant to detect the influence of line dynamics to the equipment.

‘No Input’ (input buffer empty) and ‘No Output’ (Output buffer full) are the exponents of such influences.

In certain cases i.e. with huge installations in process industry, or lines with V-shape characteristics, parties may want to know the effectiveness of some of the equipment independently from the rest of the process.
The resulting effectiveness losses are so to say collateral damage from issues outside the monitored equipment.
In other words; What would the effectiveness of the equipment be, when it was running solitaire, with no restraints from the rest of the line?

Definition of Availability in OEE Solitair

For this purpose, an OEE can be calculated excluding ‘No Input’ and ‘No Output’ thus showing the effectiveness purely focussed on the equipment independent from the line.
Calculating the OEE Solitaire takes Line restraint time (normally considered to be (I) Idle time) out of the loading time (so it is considered as Unscheduled time (-) ).

Caution: ‘No Input’/’No Output’ should not be confused with for example ‘no raw material’ or ‘no packaging’ since these have another cause; in the strict approach of Line Restraints, they are not Line Restraints. However the may be visualized as (L)ogistic restaints!

Operations effectiveness goes beyond the scope of the production team (Maintenance – Operator – Engineer). It includes the operations time the equipment is not available to the production team or when operations management does not want or cannot schedule the equipment. Examples are ‘No Orders’, ‘Legal Restrictions’ like energy contracts and mandatory holidays and test runs for R&D.

Definition of Availability in Operations Effectiveness

In the definition of OOE, regular shift-time that was unscheduled (due to no demand, R&D test runs etc.) from the regular shift time is taken into the KPI. In OEE it is being excluded from availability since this is something that happens outside the scope of the shopfloor-team responsible for the OEE. However, since  it is an operations management loss, it is being included in the availability rate of the Overall Operations Effectiveness (OOE).

Total Effective Equipment Performance also goes beyond the scope of the production team. It includes ALL potential available time losses 24/7. Upper management should always be aware of this KPI which can be simply derived from the OEE/OOE data. 

Definition of availability in TEEP

In the definition of TEEP the question is no longer whether there was ‘demand’. The time that the machine could theoretically haven been in operation is simply 24×7, regardless whether there was demand or whether it was scheduled to run or not.

This leads to the following situation:

• Performance- and Quality Rates remain the same in OEE and TEEP
• ‘OEE availability’ and ‘TEEP availability’ are (usually) different values due to its different horizons of 100% (since TEEP includes unscheduled and nonscheduled time.)

OEE Definitions

OEE Questions