Implement OEE


This page is a “quick start guide” for measuring OEE. It provides a roadmap of key decisions and is organized in three parts:

  • Define Project (things to decide before you start your OEE project)
  • Capture OEE Data (everything you need to calculate OEE)
  • Capture Detailed Loss Data (everything you need to calculate Availability, Performance, and Quality)

Before starting this page you should be familiar with the three OEE factors and how to calculate OEE.

You can type in answers right on this page or you can download a PDF form for organizing your OEE project.

Step by step guide to measuring OEE with downloadable forms
Need help implementing OEE? Download and print a PDF form to organizing your OEE project, a simple manual measurement tick sheet to collect stop time, or alternatively a manual stop time recording sheet with reasons.

Define Project

Select Pilot Area

When implementing any new initiative, it is usually best to start small and expand from a base of success. For OEE, that means starting with a pilot implementation on a single machine, cell, or line.

Select a pilot area where your employees are engaged and motivated; ideally an area where employees are interested in learning new things and applying ideas towards improvement. Preferably, select a pilot area that manufactures either one part or multiple parts with the same cycle time.

Pilot Area

Identify Constraint

OEE should be measured at the constraint step of your process (sometimes referred to as the bottleneck). The constraint is the single step or machine that governs (i.e. limits) the throughput of the overall process. Improving the constraint will improve the overall process.

Identify the constraint step of your process. Tip – WIP often accumulates at the constraint. On lines where equipment is balanced to run at identical speed, measure OEE at the step that does the primary work.

Constraint Step

Measurement Method

OEE measurement can be manual or automated.

We recommend starting with manual OEE measurement. It reinforces the underlying concepts and provides a deeper understanding of OEE. Later, you may want to automate data collection to improve accuracy, track the Six Big Losses, and to generate top losses and other reports.


Capture OEE Data

Only three pieces of information are needed to calculate OEE: Good Count, Ideal Cycle Time, and Planned Production Time.

Good Count

Good Count should only include parts that are defect-free the first time through the process. This is similar in concept to First Pass Yield, which defines good parts as units that pass through the manufacturing process the first time without needing rework.

Identify how you will collect Good Count. For manual measurement look for a counter immediately after the constraint that reliably counts good parts. For automated measurement look for a sensor immediately after the constraint that is triggered only for good parts.

Count Source

Ideal Cycle Time

Ideal Cycle Time is the theoretical minimum time to produce one part (it is NOT a ‘budget’ or ‘standard’ time). It is important that Ideal Cycle Time be a true and honest measure of how fast the process can run, even if the process currently runs slower due to product, material, or equipment problems.

Determine the Ideal Cycle Time. The preferred method is to use Nameplate Capacity (the design capacity specified by the equipment builder). An alternate method is to perform a time study (measuring the absolute fastest speed the process can support).

Ideal Cycle Time

Planned Production Time

Planned Production Time is the total time that the manufacturing process is scheduled for production. It is the yardstick against which Fully Productive Time is measured.

Start with shift time and decide if certain types of planned stops will be excluded (i.e., will not count against OEE). Most companies exclude only breaks (including lunches) and meetings.


Capture Detailed Loss Data

In order to leverage OEE to improve manufacturing productivity it is essential to calculate the three OEE factors: Availability, Performance, and Quality. This requires two more pieces of information: Run Time and Total Count. Since in practice Run Time is calculated as Planned Production Time less Stop Time, we need to collect Stop Time.

Stop Time

Stop Time is defined as all time where the manufacturing process was intended to be running but was not due to unplanned stops (e.g., breakdowns) or planned stops (e.g., changeovers).

Decide how to record stop time. For manual measurement a tick sheet is usually the easiest way to collect stop time (an alternative is to record start and end times for each stop). For automated measurement the data collection system will automatically record these times.

Decide the time threshold for recording stops. Any stop that reaches the threshold is recorded and is included as Stop Time (an Availability Loss). Any stop shorter than the threshold is considered a small stop (a Performance Loss) and is not recorded. A typical stop threshold is five minutes for manual systems and two minutes for automated systems.

Stop Time

The stop threshold is:

Total Count

Total Count is required to measure OEE Quality. It can be measured directly, or Reject Count can be measured instead, and added to Good Count to calculate Total Count.

Decide if you will measure Total Count or Reject Count. For manual measurement of Total Count look for a counter that counts all parts going into the constraint. For automated measurement of Total Count look for a sensor before the constraint that is triggered for all parts. Reject Count is measured in the same place as Good Count (see above).


Changeover Policy

Measure changeover time consistently by defining the start and end points of each event.

Document a policy for measuring Changeover Time. Three common options are:

  • First Good Part is measured as the time between the last good part produced (before setup) to the first good part produced (after setup).
  • Consistent Good Parts is measured as the time between the last good part produced (before setup) to the first instance of consistently producing parts that meet quality standards (after setup).
  • Full Speed is measured as the last good part produced at full speed (before setup) to the first good part produced at full speed (after setup).

Stop Reasons

Stop reasons provide insights as to why the process has stopped – especially for unplanned stops. They are an essential part of any manufacturing improvement program.

Create a starting list of stop reasons. Here are some tips:

  • Start simple (10 reasons).
  • Create a catch-all reason (All Other Losses).
  • Make sure every reason is clear and unambiguous.
  • Make sure every reason describes symptoms.
  • Remove reasons that aren't regularly used.
  • Add reasons if ‘All Other Losses’ is in the top ten losses.
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