Overall Equipment Effectiveness: Measure of Downtime Losses, Reduced Speed Losses and Poor-Quality Losses

 🎰 What is OEE?

• KPI
• Used while implementing TPM
• Measure effective utilization of a machine or process
• Indicate the closeness to perfect production (Only good parts, faster possible machine speed, without downtime)

🤔 Why OEE?

To Quantify

1️⃣ Downtime Losses
2️⃣ Reduced Speed Losses
3️⃣ Poor Quality Losses

📆 Formula for OEE

OEE = Availability * Performance Efficiency * Rate of Quality Product

OEE = A*E*R

1️⃣ DOWNTIME LOSSES:

Measured by EQUIPMENT AVAILABILITY (Ratio of actual operating time and planned operating time)

👉 A= T/P *100

A = Equipment Availability

T = Actual Operating Time

P = Planned Operating Time

D = Downtime

▶️ Losses Include

• Breakdown failures

• Setup and changeover time

🔎 Focus: Reduce unplanned stoppages

2️⃣ REDUCED SPEED LOSSES:

Measured by PERFORMANCE EFFICIENCY (ratio of total cycle time to actual operating time.

👉 E = [ (C*N)/T ]*100

E = Performance efficiency

C = Theoretical Cycle Time

N = Process Quality

Losses include

• minor stops and idling

• reduced operating speed or slow m/c speed

3️⃣ POOR QUALITY LOSSES: Measured by RATE OF QUALITY PRODUCTS produced (Total quality parts produced to total parts produced by the machine)

👉 R= [ (N-Q)/T ]*100

R = Rate of quality products

N = Process Quantity

Q = non-conformities or defectives

Losses include:

•Rejections and defects • Rework

Focus: Build quality at the source

Targeted OEE: -

OEE = A*E*R

if A = 90%, E=95%, R = 99%

OEE = 0.90*0.95*0.99 = 0.85 (Approx.)

Importance of OEE

• Indicates the machine's current operational condition

• Showcases the gap between current and targeted equipment effectiveness

• Identifies the opportunity for Kaizen or continuous improvement

• Data based decision making

Final Thought

OEE is not just a number. It is the reflection of the level of operational excellence of an organization, and it helps to move towards the TPM goals of Zero Breakdown, Zero Defects, & Zero Losses

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Learn OEE in detail

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8 PILLARS OF TOTAL PRODUCTIVE MAINTENANCE (TPM): FOUNDATION OF OPERATIONAL EXCELLENCE

Total productive maintenance (TPM) is a comprehensive approach to equipment maintenance that aims to maximize the efficiency and effectiveness of production processes. It originated in Japan and has been widely adopted by manufacturing industries worldwide.  TPM is built on the foundation of eight fundamental pillars, each of which plays a crucial role in achieving the overall goal of minimizing equipment downtime, reducing defects, and optimizing productivity. These eight pillars are:

1. Focused Improvement (FI)/ Kobetsu Kaizen
2. Autonomous Maintenance (AM)/ Jishu Hozen
3. Planned Maintenance (PM)/ Keikaku Hozen
4. Quality Maintenance (QM)/ Hinshitsu Hozen
5. Training and Development (T&D)/ Kyoiku Kunren
6. Early Equipment Management (EEM)/ Shoki Kanri
7. Administrative and Office TPM (AOTPM)/ Jimu TPM
8. Safety, Health and Environment (SHE)/ Anzen Eisei Kankyo)

Let's take a look over each pillar of the TPM to understand in brief.

1. FOCUSED IMPROVEMENT (FI)/ KOBETSU KAIZEN: -

Focused improvement emphasizes continuous improvement efforts aimed at identifying and eliminating the root causes of inefficiencies of equipment defects and losses. It involves the techniques like Kaizen, and problem-solving to enhance the overall equipment effectiveness.

2. AUTONOUMOUS MAINTENANCE (AM)/ JISHU HOZEN: -

This pillar focuses on empowering operators to take responsibility for routine maintenance tasks. By training and involving operators in maintenance process, the equipment stays in optimal condition, leading to reduced breakdowns and increased productivity.

3. PLANNED MAINTENANCE (PM)/ KEIKAKU HOZEN: -

Planned maintenance involves scheduling regular maintenance activities based on equipment performance data and historical analysis. By conducting preventive maintenance, businesses can address potential issues before they escalate, ensuring equipment reliability and longevity.

4. QUALITY MAINTENANCE (QM)/ HINSHITSU HOZEN: -

It emphasizes the importance of maintaining product quality throughout the manufacturing process. By preventing defects, and ensuring consistent quality standards, businesses can reduce waste, enhance customer satisfaction, and maintain a competitive edge in the market. 

5. TRAINING AND DEVELOPMENT (T&D)/ KYOIKU KUNREN: -

TPM requires a well-trained workforce capable of operating, maintaining, and troubleshooting equipment effectively. This pillar focuses on providing training and skill development opportunities to employees, ensuring they have the knowledge and expertise necessary for optical equipment performance.

6. EARLY EQUIPMENT MANAGEMENT (EEM)/ SHOKI KANRI: -

EEM focuses on integrating maintenance considerations right from the equipment design and procurement stages. By involving maintenance teams early in the equipment life cycle, potential issues can be anticipated and addressed, leading to improved reliability and reduced maintenance costs.

7. ADMINISTRATIVE AND OFFICE TPM (AOTPM)/ JIMU TPM: -

TPM is not limited to the shop floor; it extends to administrative and office functions as well. AOTPM emphasizes applying TPM principles to office processes, aiming to eliminates inefficiencies, reduce paperwork and enhance overall office productivity.

8. SAFETY, HEALTH, AND ENVIRONMENT (SHE)/ ANZEN EISEI KANKYO: -

Safety, Health and Environment are paramount concerns in any workplace. This pillar emphasizes creating a safe and healthy work environment while minimizing the impact of operations on the environment. By ensuring the well-being of employees and environmental sustainability, businesses can uphold their social responsibilities and build a positive corporate image.

These eight pillars serve as the foundation of TPM guiding organizations in their journey towards achieving operational excellence, increased productivity, and enhance competitiveness in the global market.

Watch this video to learn all 8 Pillars of TPM in detail

How OBEYA ROOM Drives High-Stakes Decision Making

Stop managing in silos and scattered dashboards.

Start leading with a visual operating system: the Obeya room.

Obeya rooms aren’t just meeting spaces.
They’re where strategy turns into action.

What is an Obeya room?
It’s a space, physical or digital,
where teams align on goals, track progress, and solve problems.

Started at Toyota.
Now used in all industries.
It mixes visuals, habits, and teamwork.

Why set one up?
To manage:
→ Daily operations
→ Big projects
→ Strategy
→ Customer issues

But first, be clear about its purpose.
No purpose = no impact.

Choose the right space
→ Easy access
→ Good for stand-ups

If physical:
→ Clear walls.
→ Bright light.
→ Good layout.

If digital:
→ Use smart tools.
→ Easy to update.
→ Safe to use.

How to structure the room
Let people “read the room” left to right.

Common zones:
→ Purpose and goals
→ Value stream and flow
→ Key performance indicators
→ Planning and timelines
→ Problems and risks
→ Actions and follow-ups

Boards to use
→ Strategy – goals and focus
→ SPQDC – Safety, People, Quality, Delivery, Cost
→ Flow – full process map
→ Plans – timelines and resources
→ Problem-solving – root causes and fixes
→ Risk – issues and owners
→ Action – tasks and blockers

Design that works
Use:
→ Red/green
→ Sliders and dials
→ Quick updates

No fluff.
Just fast info.

Make information flow
Goals → Gaps → Solutions → Plans

Boards should connect.
Stick to a routine:
→ Daily huddles
→ Weekly reviews
→ Monthly planning

Why it helps
→ One clear view
→ Less confusion
→ Faster action

Avoid these mistakes:
→ No team input
→ Overdesigned boards
→ Too much data
→ Not used in real work
→ No updates or support

Best practices
→ Start simple
→ Focus on key metrics
→ Use steady routines
→ Involve leaders
→ Keep improving