Dedicated – Single Part – Process: A process that produces a single product or slight variations on a theme and does not require significant tooling or equipment changeover events.
A single part process is the easiest application for a OEE pilot project. The single part process also makes it easier to demonstrate some of the more advanced Lean Thinking tools that can be applied to improve your operation or process. In our “Variation, Waste, and OEE” post, we introduced the potential impacts of variance to your organization. We also restated our mission to control, reduce, and eliminate variation in our processes as the primary objective of LEAN.
We need to spend more time understanding what our true production capabilities are. The single part process makes the process of understanding these principles much easier. The lessons learned can then be applied to more complex or multipart processes. In multipart or complex operations, production part sequencing may have a significant impact on hourly rates and overall shift throughput. How would you know unless you actually had a model that provided the insight?
Process Velocity: Measuring Throughput
Let’s start this discussion by asking a few simple questions that will help you to get your mind in gear. Do you measure variation in production output? Do you measure shift rates? Do you use the “average” rate per hour to set up your production schedules? How do you know when normal production rates have been achieved? Does a high production rate on one shift really signify a process improvement or was it simply a statistically expected event?
Once again an example will best serve our discussion. Assume the following data represents one week of production over three shifts:
Machine A: Production Process Performance Report
Cycle Time (Seconds):
57
Shift Standard (440 minutes)
440
Day
Shift
Planned
Quantity
Production Time
Total
Test
Scrap
Accept
Mon
1
440
420
1
2
417
Mon
2
440
390
1
1
388
Mon
3
440
320
1
3
316
Tue
1
440
361
1
1
359
Tue
2
440
392
1
5
386
Tue
3
440
365
1
2
362
Wed
1
440
402
1
7
394
Wed
2
440
317
1
6
310
Wed
3
440
430
1
1
428
Thu
1
440
453
1
5
447
Thu
2
440
419
1
3
415
Thu
3
440
366
1
1
364
Fri
1
440
400
1
2
397
Fri
2
440
411
1
4
406
Fri
3
440
379
1
2
376
Totals
15
6600
5825
15
45
5765
The following table is an extension of the above table and shows the unplanned downtime as well actual, standard, and ideal operating times.
Day
Shift
Unplanned
Operating Time
Down Time
Actual
Standard
Ideal
Mon
1
25
415.0
399.0
396.2
Mon
2
55
385.0
370.5
368.6
Mon
3
122
318.0
304.0
300.2
Tue
1
84
356.0
343.0
341.1
Tue
2
65
375.0
372.4
366.7
Tue
3
82
358.0
346.8
343.9
Wed
1
45
395.0
381.9
374.3
Wed
2
130
310.0
301.2
294.5
Wed
3
30
410.0
408.5
406.6
Thu
1
5
435.0
430.4
424.7
Thu
2
40
400.0
398.1
394.3
Thu
3
90
350.0
347.7
345.8
Fri
1
45
395.0
380.0
377.2
Fri
2
45
395.0
390.5
385.7
Fri
3
60
380.0
360.1
357.2
Totals
15
923
5677
5533.8
5476.8
The table below shows the OEE calculations for each day and shift worked. Note that this table is also an extension of the above data.
Day
Shift
Overall Equipment Effectiveness (OEE)
Availability
Performance
Quality
OEE
Mon
1
94.3%
96.1%
99.3%
90.0%
Mon
2
87.5%
96.2%
99.5%
83.8%
Mon
3
72.3%
95.6%
98.8%
68.2%
Tue
1
80.9%
96.3%
99.4%
77.5%
Tue
2
85.2%
99.3%
98.5%
83.3%
Tue
3
81.4%
96.9%
99.2%
78.2%
Wed
1
89.8%
96.7%
98.0%
85.1%
Wed
2
70.5%
97.1%
97.8%
66.9%
Wed
3
93.2%
99.6%
99.5%
92.4%
Thu
1
98.9%
98.9%
98.7%
96.5%
Thu
2
90.9%
99.5%
99.0%
89.6%
Thu
3
79.5%
99.3%
99.5%
78.6%
Fri
1
89.8%
96.2%
99.3%
85.7%
Fri
2
89.8%
98.8%
98.8%
87.7%
Fri
3
86.4%
94.8%
99.2%
81.2%
Totals
15
86.0%
97.5%
99.0%
83.0%
The results from the table above suggest that the process is running just short of world-class OEE (83% versus 90% for dedicated processes. Note that 85% is considered world-class for multipart variable processes). As you can see from the daily and shift results, a lot of variation is occurring over the course of the week. This is the opportunity that we need to pursue further. A quick scan of the data suggests that Wednesday 2nd shift and Monday 3rd shift are the main contributors to the reduced OEE. We will investigate the data a little further to really understand what opportunities exist.
A dedicated, continuous process should yield a higher OEE since the process is not subject to continual setup and change over. Although some model changes or variations to the existing product may exist, they are typically less disruptive. A OEE of 90% may be an achievable target and is typical for most dedicated operations.
FREE Downloads
We are currently offering our Excel OEE Spreadsheet Templates and example files at no charge. You can download our files from the ORANGE BOX on the sidebar titled “FREE DOWNLOADS” or click on the FREE Downloads Page. These files can be used as is and can be easily modified to suit many different manufacturing processes. There are no hidden files, formulas, or macros and no obligations for the services provided here.
In its simplest form, availability measures the uptime of a machine or process against the planned production time. As one of the factors of Overall Equipment Efficiency (OEE), Availability is expressed as a percentage. The uptime is calculated by taking the difference between the planned production time and total duration of the downtime events that occurred during the planned production period.
We specifically address the “Availability” factor in this post for the simple reason that the definition of availability is likely to be one of the most debated and hotly contested topics of your OEE implementation strategy. The reason for this, in many cases, is the lack of clarity in some of the most basic terminology. The purpose of this discussion is to present some topics for consideration that will allow you to arrive at a clear definition that can perhaps be formed into a standard policy statement.
We will also demonstrate that it is possible to calculate the downtime by simply knowing the cycle time or process rate, the quantity of parts produced, and the planned production time. We recommend using this technique to validate or reconcile the actual documented downtime. We would argue that the first and foremost purpose of any machine monitoring or downtime event measurement system is to determine the “WHY and WHAT” of the downtime events and secondly to record the “When and How Long”.
You will learn that monitoring your processes to determine causes and duration of downtime events is key to developing effective action plans to improve availability. The objective of any machine automation, sensor strategy, or data collection and analysis is to determine methods and actions that will improve the availability of the equipment through permanent corrective actions, implementing more effective trouble shooting strategies (sensor technologies), improved core process controls, or more effective preventive maintenance.
Define the purpose of OEE
While it looks like we’re taking a step back from the topic of discussion, bear with us for just a paragraph or two. A clear statement of purpose is the best place to start before executing your OEE implementation strategy:
To identify opportunities to improve the effectiveness of the company’s assets.
You will quickly realize that, when attempting to define the measurement criteria for the OEE factors, in particular Availability, your team may present rationale to exclude certain elements from the measurement process. These rationalizations are typically predicated on existing policy or perceived constraints that simply cannot be changed. People or teams do not want to be penalized for items that are “out of their control” or bound by current policy. Continuous improvement is impeded by attempts to rationalize poor performance.
We understand that some of these “exclusions” present a greater challenge, however, we do not agree with the premise that they cannot be improved. Again, it is a matter of “purpose”. Limiting the scope of measurement will limit the scope of improvement. Now it’s time to explore what could be the foundation for a sound definition of availability.
Availability Considerations
It may seem reasonable to assume that, at a minimum, the only planned down time events that should be excluded from the availability factor are planned preventive maintenance activities, mandatory break periods, and scheduled “down” time due to lack of work. We would argue and agree that the only justification for an idle machine is “Lack of Work”.
What would be the reason to settle for anything less? If Preventive Maintenance is critical to sustaining the performance of your process, doesn’t it make sense to consider it in the measurement process? The rationale that typically follows is that Preventive Maintenance must be done and it’s really out of our control – it is a planned event. We would argue that the time to complete Preventive Maintenance can be improved.
Is it possible that the Mean Time Before Failure or Required Maintenance can be extended? Is it possible to improve materials, components, or lubricants that could extend the process up time? Is it possible to improve the time it actually takes to perform the required maintenance? If so, what is the measure that will be used to show that additional capacity is available for production.
If set up times for die changes or tool changes can be improved from hours to minutes, could the same effort and devotion to improve Preventive Maintenance techniques yield similar results? We think so.
One example is the use of synthetic oils and lubricants that have been proven to significantly extend the life of tools and components and also reduces the number changes required over the service life of the machine. Quick change features that can assist with easy and ready access to service points on tooling and machines can also be implemented to reduce preventive maintenance times.
The other exclusion that is often argued is break times. Labour laws require you to provide break times for your employees. However, since automated processes are not subject to “Labour Laws”, the “mandatory break times” do not apply. We would argue that methods should be pursued to reduce the need for human intervention and look for ways to keep the machine running. Is it possible to automate some of the current processes or rotate people to keep the machine running?
Aside from this more obvious example, consider other organizational policies that may impact how your organization runs:
Shift start-up meetings
Employee Communication Meetings
End of Shift clean up periods
Quality first off approval process
Shift first off versus Run first off
Weld Tip changes – PM or Process Driven
What is the purpose of the shift start-up meeting? What is the purpose of the monthly employee communication meeting? Could this information be conveyed in a different form? What length of time is really required to convey the message to be shared? Is the duration of the meeting actually measured or do you resort to the standard time allotted?
Clean up periods at the end of the shift are also a common practice in many plants. What is being cleaned up? Why? Is it possible to maintain an orderly workplace during the shift – clean up as it happens in real-time? Again, do you record the actual clean up time or do you just enter the default clean up time allotted?
How much time is lost to verify the integrity of the product before allowing production to commence? What process parameters or factors would jeopardize the quality of the product being produced? No one wants to make scrap or substandard components, however, the challenge remains to determine what factors influence the level of quality. If it is possible to determine what factors are critical to success in advance, then perhaps the quality verification process becomes a concurrent event.
Measuring Downtime.
There are other factors that can impact availability including, but certainly not limited to, personnel (illness, inclement weather), material availability, other linked processes (feeder / customer), material changes, tool changes, quality concerns, and unexpected process, equipment, or machine faults.
It is possible to use manual or automated systems to collect various machine or process codes to record or document the duration and type of downtime event. We recommend and support the use of automated data collection systems, however, they should be implemented in moderation. One of the primary impediments to success is overwhelming volumes of data that no one has the time to analyze.
The Goal = 100% Up Time = ZERO Down Time = Zero Lost Time = Zero Defects = 100% Availability
The goal is to use the data and tools available to either permanently resolve the problem by implementing an effective corrective action or to assist the trouble shooting process by identifying the failure mode and to minimize the duration of the downtime event.
We have witnessed data collection strategies where an incredible number of sensors were installed to “catch” problems as they occur. The reality was the sensors themselves became the greater cause of downtime due to wear or premature failure due to improper sensor selection for the application. Be careful and choose wisely.
When used correctly, automation can be a very effective tool to capture downtime events and maintain the integrity of the overall measurement process. With the right tools, trouble shooting your process will minimize the duration of the down time event. Monitoring the frequency of these events will also allow you to focus your attention on real opportunities and circumvent nuisance faults.
The objective of collecting the “downtime event” history is to determine what opportunities are available to improve uptime.
Duration versus Frequency
The frequency of a downtime event is often overlooked as most of the attention is devoted to high duration downtime events. Some sources suggest that short duration downtime events (perhaps as little as 30 seconds) are not worth measuring. These undocumented losses are reflected, or more accurately hidden, by a corresponding reduction in the performance factor.
Be careful when setting what appears to be simple policy to document downtime. A 20 second downtime event that occurs 4 times per hour could quickly turn into 10 minutes a shift, 30 minutes a day, 2.5 hours a week, 125 hours a year. Rather than recording every event in detail, we recommend implementing a simple “tick” sheet to gain an appreciation for the frequency of failures. Any repetitive events can be studies and reviewed for corrective action.
Verify the Downtime
One of the advantages of OEE is that it is possible to reconcile the total time – OEE should never be greater than 100%. Of course this statement requires that the standard cycle time is correct and the total quantity of parts produced is accurate. So, although all of the downtime events may not be recorded, it is very easy to determine how much downtime occurred. This will help to determine how effectively downtime data is being recorded.
A perfect example to demonstrate this comes from the metal stamping industry. Progressive dies are used to produce steel parts from coil steel. The presses typically run at a fixed “predetermined” optimum run rate. Depending on the type of part and press, progressive dies are capable running at speeds from as low as 10 strokes per minute up to speeds over 300 strokes per minute.
For ease of calculation, assume we have a press that was scheduled to run a part over an 8 hour shift having two 10 minute breaks. The standard shift hours are 6:45 am – 3:15 pm and 3:30 pm – 12:00 am. The company provides a 30 minute unpaid meal break after 4 hours of work. The optimum press speed to run the part is 20 strokes per minute (spm). If a total of 6200 parts were made – how much downtime was incurred at the press?
To determine the press time required (also known as earned time), we simply divide the quantity of parts produced by the press rate as follows:
Machine Uptime: 6200 / 20 = 310 minutes
Our planned production time was 8 hours or 480 minutes. Assuming that company policy excludes break times, the net available time to run the press is 480 – (2 x 10) = 460 minutes.
Availability = Earned Time / Net Available Time = 310 / 460 = 67.39%
We can see from the above example that it easy to determine what the downtime should have been and, in turn, we could calculate the availability factor. This calculation is based on the assumption that the machine is running at the stated rate.
The Availability TWIST (1):
Knowing that press and die protection technologies exist to allow presses to run in full automatic mode, the two break periods from our example above do not apply to the equipment, unless company policy states that all machines or processes must cease operations during break periods.
Assuming that this is not the case, the press is available for the entire shift of 480 minutes. Therefore, the availability calculations from above would be:
Availability = Earned Time / Net Available Time = 310 / 480 = 64.58%
The Availability TWIST (2):
Just to expand on this concept just a little further. We also indicated that the company provided an unpaid lunch period of 30 minutes. Since meal breaks don’t apply to presses, the reality is that the press was also available to run during this period of time. The recalculated downtime and availability are:
Availability = Earned Time / Net Available Time = 310 / 510 = 60.78%
The Availability TWIST (3):
Finally, one last twist (we could go on). We deliberately indicated that there was a 15 minute break between shifts. Again, is there a reason for this? Does the machine have to stop? Why?
Availability – NEXT Steps
As you begin to look at your operations and policies, start by asking WHY do we do this or that? The example provided above indicates that a significant delta can exist in availability (close to 7%) although the number of parts produced has not changed. The differing results are related to policy, operating standard, or both.
If the performance (cycle time or production rate) and total quantity of parts produced data have integrity, the availability factor can be reconciled to determine the integrity of the downtime “data collection” system. From this example it should also be clear that the task of the data collection system is to capture the downtime history as accurately as possible to determine the opportunities to improve availability NOT just to determine how much downtime occurred.
This example also demonstrates why effective problem solving skills are critical to the success of your lean implementation strategy and is also one of the reasons why programs such as six sigma and lean have become integrated as parallel components of many lean execution strategies.
The Goal: 100% uptime / Zero downtime / Zero lost time /100% availability
Regardless of the measurement baseline used, be consistent. Exclusions are not the issue, it is a matter of understanding what is involved in the measurement process. For example, maintenance activities performed during break periods may be a good management practice to improve labour efficiencies, however, the fact that the work was performed during a break period should not exclude it from the “downtime” event history. We would argue that all activities requiring “equipment time” or “process time” should be recorded.
FREE Downloads
We are currently offering our Excel OEE Spreadsheet Templates and example files at no charge. You can download our files from the ORANGE BOX on the sidebar titled “FREE DOWNLOADS” or click on the FREE Downloads Page. These files can be used as is and can be easily modified to suit many different manufacturing processes. There are no hidden files, formulas, or macros and no obligations for the services provided here.
What gets managed MUST be measured – Including VARIANCE.
It is easy to get excited about the many opportunities that a well implemented LEAN Strategy can bring to your organization. Even more exciting are the results.
Achieving improvement objectives implies that some form of measurement process exists – the proof. A clear link should be established to the metric you choose and the activity being managed to support the ongoing improvement initiatives.
Measure with Meaning
Why are you “collecting” OEE data? While OEE can and should be used to measure the effectiveness of your manufacturing operations, OEE on its own does not present a complete solution. It is true that OEE presents a single metric that serves as an indicator of performance, however, it does not provide any insight with respect to VARIANCES that are or may be present in the system.
We have encountered numerous operations where OEE data can be very misleading. OEE data can be calculated using various measurement categories: by machine, part number, shift, employee, supervisor, department, day, month, and so on.
VARIANCE: the leading cause of waste!
Quality professionals are more than familiar with variance. Statistically capable processes are every quality managers dream. Unfortunately, very little attention or focus is applied to variances experienced on the production side of the business.
Some may be reading this and wonder where this is going. The answer is simple, rates of production are subject to variance. Quite simply, if you review the individual OEE results of any machine for each run over an extended period of time, you will notice that the number is not a constant. The performance, availability, and quality factors are all different from one run to the next. One run may experience more downtime than another, a sluggish machine may result in reduced in performance, or material problems may be giving rise to increased quality failures (scrap).
So, while the OEE trend may show improvement over time, it is clear that variances are present in the process. Quality professionals readily understand the link between process variation and product quality. Similarly, variation in process rates and equipment reliability factors affect the OEE for a given machine.
We recommend performing a statistical analysis of the raw data for each factor that comprises OEE (Availability, Performance, and Quality) for individual processes. Analysis of OEE itself requires an understanding of the underlying factors. It is impractical to consider the application of ANOVA to OEE itself as the goal is to continually improve.
How much easier would it be if you could schedule a machine to run parts and know that you will get them when you needed them? You can’t skip the process deep dive. You need to understand how each process affects the overall top-level OEE index that is performance so you can develop and implement specific improvement actions.
The best demonstration we have seen that illustrates how process variation impacts your operation is presented through a “process simulation” developed from Eli Goldratt’s book, The Goal. We will share this simulation in a separate post. Experiencing the effect of process variation is much more meaningful and memorable than a spreadsheet full of numbers.
Conflict Management and OEE
In some environments we have encountered, the interpretation of LEAN strategy at the shop floor level is to set minimum OEE performance objectives with punitive consequences. This type of strategy is certainly in conflict with any Lean initiative. The lean objective is to learn as much as possible from the process and to identify opportunities for continual improvement.
Management by intimidation is becoming more of a rarity, however, we have found that they also give rise to the OEE genius. If performance is measured daily, the OEE genius will make sure a high performing job is part of the mix to improve the “overall” result. This is akin to taking an easy course of study to “pull up” your overall average.
It is clear from this example, that you will miss opportunities to improve your operation if the culture is tainted by conflicting performance objectives. The objective is to reveal sources of variation to eliminate waste and variation in your process, not find better ways to hide it.
Variance in daily output rates are normal. How much are you willing to accept? Do you know what normal is? Understanding process variance and OEE as complementary metrics will surely help to identify more opportunities for improvement.
FREE Downloads
We are currently offering our Excel OEE Spreadsheet Templates and example files at no charge. You can download our files from the ORANGE BOX on the sidebar titled “FREE DOWNLOADS” or click on the FREE Downloads Page. These files can be used as is and can be easily modified to suit many different manufacturing processes. There are no hidden files, formulas, or macros and no obligations for the services provided here.
As mentioned in our previous posts, OEE is a terrific metric for measuring and monitoring ongoing performance in your operation. However, like many metrics, it can become the focus rather than the gage of performance it is intended to be.
The objective of measuring OEE is to identify opportunities where improvements can be made or to determine whether the changes to your process provided the results you were seeking to achieve. Lean organizations predict performance expectations and document the reasons to support the anticipated results . The measurement system used to monitor performance serves as a gauge to determine whether the reasons for the actual outcomes were valid. A “miss” to target indicates that something is wrong with the reasoning – whether the result is positive or negative.
Lean organizations are learning continually and recognize the need to understand why and how processes work. Predicting results with supported documentation verifies the level of understanding of the process itself. Failing to predict the result is an indicator that the process is not yet fully understood.
Problem Solving with OEE
Improvement strategies that are driven by OEE should cause the focus to shift to specific elements or areas in your operation such as reduction in tool change-over or setup time, improved material handling strategies, or quality improvement initiatives. Focusing on the basic tenets of Lean will ultimately lead to improvements in OEE. See the process in operation (first-hand), identify opportunities for improvement, immediately resolve, implement and document corrective actions, then share the knowledge with the team and the company.
Understanding and Managing Variance:
OEE data is subject to variation like any other process in your operation. What are the sources of variation? If there is a constant effort to improve performance, then you would expect to see positive performance trends. However, monitoring OEE and attempting to maintain positive performance trends can be a real challenge if the variances are left unchecked.
Availability
What if change-over times or setup times have been dramatically reduced? Rather than setting a job to run once a week, it has now been decided to run it daily (five times per week). What if the total downtime was the same to make the same number of parts over the same period of time? Did we make an improvement?
The availability factor may very well be the same. We would suggest that, yes, a signficant improvement was made. While the OEE may remain the same, the inventory turns may increase substantially and certainly the inventory on hand could be converted into sales much more readily. So, the improvement will ultimately be measured by a different metric.
Performance
Cycle time reductions are typically used to demonstrate improvements in the reported OEE. In some cases, methods have been changed to improve the throughput of the process, in other cases the process was never optimized from the start. In other instances, parts are run on a different and faster machine resulting in higher rates of production. The latter case does not necessarily mean the OEE has improved since the base line used to measure it has changed.
Quality
Another example pertains to manual operations ultimately controlled through human effort. The standard cycle time for calculating OEE is based on one operator running the machine. In an effort to improve productivity, a second operator is added. The performance factor of the operation may improve, however, the conditions have changed. The perceived OEE improvement may not be an improvement at all. Another metric such as Labour Variance or Efficiency may actually show a decline.
Another perceived improvement pertains to Quality. Hopefully there aren’t to many examples like this one – changing the acceptance criteria to allow more parts to pass as acceptable, fit for function, or saleable product (although it is possible that the original standards were too high).
Standards
Changing standards is not the same as changing the process. Consider another more obvious example pertaining to availability. Assume the change over time for a process is 3o minutes and the total planned production time is 1 hour (including change over time). For simplicity of the calculation no other downtime is assumed. The availability in this case is 50% ((60 – 30) / 60).
To “improve” the availability we could have run for another hour and the resulting availability would be 75% (120 – 30) / 120. The availability will show an improvement but the change-over process itself has not changed. This is clearly an example of time management, perhaps even inventory control, not process change.
This last example also demonstrates why comparing shifts may be compromised when using OEE as a stand-alone metric. What if one shift completed the setup in 20 minutes and could only run for 30 minutes before the shift was over (Availability = 60%). The next shift comes in and runs for 8 hours without incident or down time (Availability = 100%). Which shift really did a better job all other factors being equal?
Caution
When working with OEE, be careful how the results are used and certainly consider how the results could be compromised if the culture has not adopted the real meaning of Lean Thinking. The metric is there to help you improve your operation – not figure out ways to beat the system!
FREE Downloads
We are currently offering our Excel OEE Spreadsheet Templates and example files at no charge. You can download our files from the ORANGE BOX on the sidebar titled “FREE DOWNLOADS” or click on the FREE Downloads Page. These files can be used as is and can be easily modified to suit many different manufacturing processes. There are no hidden files, formulas, or macros and no obligations for the services provided here.
