Date Published: 17-05-2022

What is OEE?

OEE (Overall Equipment Effectiveness) is the gold standard for measuring manufacturing productivity. It identifies the percentage of manufacturing time that is truly productive. Having a 100% OEE score means you are producing only Good Parts, as fast as possible, without any Stop Time. In OEE, that means 100% Quality (only Good Parts), 100% Performance (as fast as possible), and 100% Availability (no Stop Time). Simply put, OEE can be expressed by the formula:

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The three main factors of Overall Equipment Effectiveness

Production Availability - your uptime compared to your scheduled production time. By reducing downtime (planned or unplanned) to ensure that your machinery is available when you need it. A non-producing manufacturing line increases costs without producing anything.

Performance - your actual rate (actual machine speed) versus standard rate (design machine speed). Ensure that your production process is going at the correct speed, to get as many jobs done each week as possible. Any slow performance will result in longer run times.

Quality - your good product versus your total product. In an ideal world, there should be no defective or scrapped items, but a product that can be reworked is less detrimental to OEE than one that must be discarded.

Why does OEE matter?

With OEE, you can gain insights into your manufacturing process and identify losses, and how to systematically improve your manufacturing process. OEE is the single best metric for identifying losses and helps with the benchmarking progress.

In short, OEE is returned as a simple number that gives an indication of how effectively your plant’s resources such as time, material, and equipment are utilised.

6 Benefits of OEE

Helps you achieve Return on Investment (ROI) on equipment

Delivers significant ROI, whether you’re increasing volume, or driving effectiveness. The objective of OEE is to obtain maximum productivity.

Real-time production monitoring

Automated data collection, ensures the data quality is relevant, precise and transparent.

Improve efficiency

Enable accurate OEE analysis without manipulating data in tools such as reports and spreadsheets.

Provides real-time targets

Real-time production targets.


OEE Software determines downtime and reveals productivity data. Management can allocate resources to team members throughout the plant to ensure greater accountability.

Continuous improvement

Detect excellent runs and set the next target.

Why is it important to know your OEE?

  • Improvement opportunities are primarily reflected in OEE.
  • OEE identifies the main reasons for production losses.
  • OEE can be implemented as a great motivator, providing operators with visible insights into target matrices.
  • OEE identifies your production bottlenecks.

If you don’t have an OEE System? We've got you covered at S4!
S4 can offer a wide range of OEE solutions ranging from stand-alone OEE appliances to fully customisable, ERP integrated systems.

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