The OEE formula in detail

Availability

Availability measures the proportion of planned production time that the machine was actually running (not stopped due to unplanned failure or unplanned stoppages).

Availability = Run Time ÷ Planned Production Time
Run Time = Planned Production Time − Unplanned Downtime

Example: 480 min planned, 45 min downtime → Run time = 435 min → Availability = 435 ÷ 480 = 90.6%

Performance

Performance compares actual throughput to the maximum possible throughput at ideal speed during the available run time.

Performance = (Total Count ÷ Run Time) ÷ Ideal Run Rate

Example: 180 parts in 435 min, ideal rate 0.5 parts/min → Performance = (180 ÷ 435) ÷ 0.5 = 0.414 ÷ 0.5 = 82.8%

Quality

Quality measures the proportion of total output that meets quality standards (no rework or scrap).

Quality = Good Count ÷ Total Count

Example: 175 good parts from 180 total → Quality = 175 ÷ 180 = 97.2%

OEE

OEE = Availability × Performance × Quality = 90.6% × 82.8% × 97.2% = 72.9%

OEE benchmarks

OEE scoreRatingInterpretation
≥85%World-classExcellent — most plants aspire to this level. Only top-quartile manufacturers achieve it consistently.
65–85%GoodTypical for well-managed manufacturing plants. Room for improvement but not urgently problematic.
40–65%AverageTypical for most manufacturing plants. Significant losses — likely major opportunities in speed losses and planned downtime.
<40%UnacceptableSignificant, systematic losses. Likely frequent breakdowns and/or severe quality issues. Urgent improvement needed.

The six big losses

TPM (Total Productive Maintenance) maps OEE losses to six categories that point to the root causes of each component loss:

OEE componentLoss categoryExamples
AvailabilityEquipment failureBreakdown, unplanned stoppages lasting >5 min
Setup and adjustmentChangeovers, warm-up, adjustments after changeover
PerformanceIdling and minor stoppagesJams, sensor trips, stoppages <5 min that don't get counted as downtime
Reduced speedMachine running below ideal rate — worn tooling, conservative settings, operator pacing
QualityScrap and reworkDefective parts produced during steady-state operation
Startup rejectsDefective parts during warm-up or after changeover before process stabilises

How to improve OEE

The biggest gains typically come from addressing losses in this order:

  1. Equipment failure (Availability) — usually the biggest single loss. Implement a PdM programme on the top 5 critical pieces of equipment. Each hour of unplanned downtime eliminated has the highest leverage on OEE.
  2. Minor stoppages and idling (Performance) — often underestimated because they don't appear in downtime records. Install cycle counters and compare to ideal rate — the gap reveals minor stoppages. Address root causes (worn infeed guides, sticky sensors, air blast blockages).
  3. Reduced speed (Performance) — often operators run below ideal rate due to concern about quality. Identify the root cause of why ideal speed was abandoned and address it.
  4. Setup and adjustment (Availability) — SMED (Single Minute Exchange of Die) methodology reduces changeover time systematically.
  5. Scrap and rework (Quality) — use SPC and process capability analysis to identify and eliminate root causes of variation.